Probate Services (Approved Bodies) Order 2009

On licences, it is difficult to quantify exactly the numbers. However, the Association of Chartered Certified Accountants does not estimate that many will take up the opportunity initially. The CLC has issued 18 licences but 89 of its members are working to gain qualification. ICAS has not yet awarded any but it is waiting to see what happens in Scotland. I shall deal first with the market and the policy direction. Clearly the policy direction has been developed over a number of years, and it is to open up legal services to competition. However, legal services are pretty efficiently delivered at this level in the UK. Frankly, what we are now doing is in practice likely to relate to the current customers of chartered accountants. As one noble Lord mentioned, some families have a family lawyer and, if a bereavement occurs, it is natural for them to contact that lawyer. Other families have a long relationship with their accountant, who may deal with their tax every year and look after their affairs. Reading from my script, the primary market of the Association of Chartered Certified Accountants for probate services will be existing clients with whom it already has long-standing relationships, resulting in an intimate knowledge and understanding of their financial affairs. A high level of trust will have been established and therefore members of the ACCA will often be a natural choice for clients or their families to act as executives or administrators of success. The ACCA also considers that having members with probate rights will allow it to provide continuity of service to clients. Its members’ knowledge of clients’ financial affairs will also make the process of obtaining a grant of probate more efficient, less stressful and less expensive for clients. A full regulatory impact assessment was completed for the implementation of Section 55 of, and Schedule 9 to, the Courts and Legal Services Act to open up the market for the provision of probate services. It provided details of the costs and business implications for the new providers and the impact on solicitors’ firms, and it showed that commencing Section 55 was expected to have little impact on the probate market. The potential impact of new providers on the market was estimated to be less than 5 per cent over the decade, although, in practice, the impact could well be much less than that. Although not relevant to this application, Bridget Prentice has undertaken to look at the RIA to consider whether it needs further updating in view of the expected impact of allowing new providers on to the market. On the matter of vulnerable clients, only members authorised to engage in public practice work—those holding practising certificates from the ACCA—will be eligible to apply for authorisation to provide probate services. Members must also comply with the ACCA’s code of ethics and conduct and its fundamental principles, which set out the obligations placed on all members. In particular, members are required to demonstrate professional competence and due care, and they have a continuing duty to adequately maintain professional knowledge and skills to ensure that clients receive competent professional services. Members must act diligently and in accordance with professional standards when providing professional services. The ACCA has a rigorous regulatory function, which includes monitoring practice members in regulated areas, including the probate service, which will clearly be a regulated area. Such monitoring includes investigating complaints, regulating hearings and applying stringent regulations under a code of ethics. At any monitoring visit, a compliance review is carried out to check a member firm’s compliance with the ACCA’s practising regulations and code of conduct. In particular, members are required to demonstrate professional competence and due care, and they have a continued duty to maintain their professional knowledge and skills to ensure that clients receive competent professional services. Only members authorised to engage in public practice work—that is, members who hold practising certificates from the ACCA—will be eligible to apply for authorisation to provide probate services. Practising certificates are annually renewable. All applications for authorisation, including applications for renewal, are subject to approval by the ACCA’s admission and licensing committee. Part of the authorisation procedure will be to assess the training and practical experience obtained by ACCA members relevant to the provision of probate services. The other questions from the noble Lord, Lord Thomas of Gresford, were based on the equivalence between the regulation of probate services provided by the ACCA and the regulation of probate services provided by solicitors. I went into this issue carefully at my briefing. Essentially, the system works like this: a solicitor would have regulation under the Law Society; an accountant would have regulation under the ACCA. Before this power is grantable to the ACCA it has to prove itself, under the processes in Section 55 of the previous Act, as competent to exercise that power. If there is concern among either the Law Society or the ACCA about the exercise of that power then a common, more senior body will decide. That body is about to change, I believe, under the 1997 Act. I cannot remember the name of the current body or what the new one will be, but they will converge in a current body. The Legal Services Consultative Panel was consulted on whether this would be the appropriate body. As I understand it, the panel addresses similar questions. It is a very high-status body which is well respected by the legal profession. For this investigation, it was headed by a Lord Justice of Appeal, Lord Justice Moore-Bick, and its membership included three QCs, a number of solicitors and so on. It is the statutory body that Section 55 of the Act, or the order commencing that section, requires to consider whether the ACCA has put in place satisfactory arrangements. It conducted a number of investigations, inquiries and discussions. Key among those, as has been quite properly alighted upon, was the matter of compensation—I think that "run-off" is the term—and so on and so forth. As I understand it, lawyers have a joint scheme approach through the Law Society. That is not a very good technical term, but, as I understand it, it is a kind of pay-as-you-go scheme. Accountants have various professional insurers and so on. The Legal Services Consultative Panel was concerned about that and wished to be assured that the accountants’ insurance arrangements were equivalent in the comfort they gave clients to those that lawyers offer. After an alteration in the amount—I believe the amount moved for the smallest practitioners from £50,000 to £100,000; I shall write if those figures are wrong—the panel concluded, and advised the Secretaries of State, that the application from the Association of Chartered Certified Accountants to become an approved body to authorise its members to provide probate services under Section 55 of the Courts and Legal Services Act 1990 should be approved.