Clementi and the Law SocietyPOST-CLEMENTI REPRESENTATION
In December 2004 Sir David Clementi finally concluded his wide-ranging review into the provision of legal services.
The potential consequences of his findings could bring about the most significant wave of change to the legal profession in its history, and create a markedly different landscape from that which you are working to enter right now. What is the reason for the review, what will happen in the immediate future and how will it affect future entry to the profession? Essentially, how will it affect you, as someone at the beginning of his/her legal career?
The TSG has responded to each stage of the consultation regarding Clementi, and its responses are mainly set out in the "Background" part to this section of the website. Please navigate this section to determine the answers to the questions above, and also to determine the current situation and its impact on the profession.
CURRENT POSITION
The Draft Legal Services Bill has now been published by the Government.
Kevin Martin, President of the Law Society, says in the Times on 25 May 2006, "We are concerned the LSB might be overbearing and might seek to interfere too much, and we are going to look at the legislation in great detail." Martin says that opening up the market to allow other kinds of companies to offer legal advice was welcome, provided that they compiled with the same high standards of consumer protection as law firms. "It should improve consumer choice but...we are very concerned that the regulation of these entities is proportionate and that there is a level playing field."
"Consumers and the international competitiveness of law firms will suffer if the regulatory burden and the cost of compliance are increased unnecessarily," says the Law Society in the Daily Telegraph on 25 May 2006.
The Draft Bill can be accessed HERE.
The TSG Response
The TSG feel that the Draft Legal Services Bill has not gone far enough to implement the Clementi reforms. The aims of the Clementi review were clear and certainly indicated drivers which the profession should use moving forward. In the Draft Bill, these have become diluted.
Specifically, the TSG feels that:
The Draft Bill proposes the erosion of the independence of the legal profession. As it stands, the Bill allows for the appointment of the Legal Services Board (“the LSB”) by the Secretary of State. This is against the rule of law and UN principles. Not only this, but it undermines both the reputation of and confidence in the legal profession. It is essential that the legal profession remain wholly separate from government.
The LSB, as drafted, is not a “light touch” regulator.
The Draft Bill does not include all legal services, for example will writers. How will these legal service providers be regulated?
There are inadequate safeguards on alternative business structures in the Draft Bill and, accordingly, the public is not adequately protected under its provisions.
The cost of the new regulatory framework will be increased if the front line regulators are not unfettered. Further, it is unclear how the set-up costs of the LSB or Office of Legal Complaints will be funded. There is mention of a “levy”, but no indication of the actual amounts included. The reforms implement Government policy. The professions should not have to pay for the system to be altered, and certainly should not bear the transitional costs.
The proposals will result in a lack of access to justice to significant numbers of the public. The cost of the funding of these new bodies, in particular, will have the effect of reducing the number of legal aid lawyers, high street lawyers or ethnic minority lawyers. Some smaller firms will be driven out of business or will have to amalgamate with larger firms. We disagree with the small firms’ impact test.
The TSG updating letter to the DCA can be read HERE.
WHAT DOES THIS MEAN FOR TSG MEMBERS?
At the moment, business is usual for the TSG and its members.
However, the face of the profession is changing.
The Clementi reforms have shaken-up the legal profession. The Law Society has now completely split its regulatory and representative functions - giving us the Law Society Regulation Board ("LSRB") and the Law Society itself. This means a difference in the way in which the profession is governed. However, the dust has not yet settled since the review and the proposed reforms, and we shall need to sit tight to determine what the future holds.
In this light of this representative split, the Law Society's focus has changed. They are no concerned solely with the way in which they represent the profession - both to the LSRB and the government. They are also cobcerned with the image of the profession to the public as a whole.
Due to this change of focus, it is incumbent on the TSG not to be left behind by change. To this end, the TSG is in consultation with both the Law Society and the YSG ("Young Solicitors Group") concerning a possible move to estlablishing a Division to represent junior lawyers within the Law Society. This is still in embryonic stages, but change is essential to allow the TSG to fit into the post-Clementi profession.
For more information, please see the pages entitled THE FUTURE OF THE TSG on this website.
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