Legal Services Bill [Lords]

The hon. Member for Bassetlaw (John Mann) has made some valid points about the need for regulation and eloquently explained how it is possible for professionals to work against the interests of their clients. Hon. Members will be well aware of my interest in what happens in the family division. There, for anyone other than the individual concerned or a lawyer to report bad behaviour to the regulators is contempt of court, which means that there is a lot more bad behaviour. The question is: how far should regulation go? Historically, many organisations and corporate entities have employed solicitors—for example, trade unions, the Medical Protection Society and city councils. What sort of regulation is appropriate in those circumstances? One of the difficulties the trade unions face is that the day-to-day activity of a trade union convenor representing their members in a workplace is often a negotiation, and if the trade union had to regulate itself as an alternative business structure, ordinary day-to-day trade union activity might be regulated in the same way as legal activity. That would obviously be completely wrong. To that extent, the Government's approach of aiming to exempt trade unions from much of the regulatory process is sensible. However, other organisations—mutual organisations that are not trade unions, such as the Medical Protection Society—could also be trapped by the ABS regulations. I accept that the drafting of my amendment may not be the only way to crack this nut; perhaps in another place the nut will have to be cracked in a more subtle manner. However, in completely rewriting the regulation of the legal profession as we are doing, we should not, through over-regulation, trample on some the mutual organisations that do a good job for their members. Amendment No. 152 considers the issue from the point of view of mutual organisations that are not trade unions. I do not say that the amendment is necessarily the best way of going about the matter, but the issue needs to be resolved. It is important to introduce adequate regulation and to make sure that we protect the interests of people who deal with the legal profession. The issue particularly affects situations in which someone employs a firm of lawyers to act for them. Of course, the fact that the Legal Services Commission is paying for things presents a challenge; there is the question of whether that means that people do not act as well as they would if clients paid them directly. The case of mutual organisations that employ in-house lawyers does not really fit in with that; such lawyers should and will be regulated. There is the argument that one should limit what is done by the mutual organisation—in other words, if we give exemptions to mutual organisations or trade unions, we should limit that exemption, so that trade unions and mutual bodies cannot suddenly set up as conveyancing operations and benefit from the exemptions. There is an argument for that, but I think that we are generating a sledgehammer to crack nuts, and in the case of some of the mutual organisations, there are no nuts to be cracked. The amendment aims to be a way forward for dealing with that issue.