Chair’s Blog – July 2020


Photo of Dr Helen Phillips
Dr Helen Phillips

Once again, we held our Board meeting virtually. The agenda included a focus on Covid-19 and the work we are doing to support the sector, our review of the Practicing Certificate Fee, and our plans to increase the pace of change on diversity and inclusion in legal services.

Covid-19:

As we have done over the last three months,  we started the Board meeting with a focus on the impact that Covid-19 is having on the legal sector and how we would support a recovery driven by the need to protect consumers and promote access to justice.

Our recently launched Covid-19 dashboard has brought together several sources of data to help increase understanding within the sector of the consequences of pandemic. The tool is enabling regulators, providers and others across the legal services sector to assess the impact of the crisis and make informed decisions. By understanding the increases and decreases in consumer demand for various legal services, providers can mitigate negative impacts and identify opportunities.

The Board agreed that the next priority is to gather data on the supply side. Among other things, we are keen to explore further how Covid-19 has impacted legal aid practitioners, junior members of the profession and sole practitioners.

We will request data from regulators to increase our understanding of how any impact on the supply of legal services could affect the regulatory objectives. We will also emphasise the importance of regulators understanding the impact that the pandemic is having on their regulated community and the regulatory objectives. The Board agreed that if the regulators fail to make appropriate efforts in this area, we will consider whether they are meeting the regulatory performance standards. Specifically, RA3 which requires regulators to have a robust evidence base from a range of sources on: (a) consumers’ needs and use of legal services (b) new and emerging policy developments (c) the regulated community and (d) the market(s) regulated by it which informs its regulatory arrangements and approach.

The dashboards will be updated monthly, and we will use the feedback we receive to continue to develop the tool. We also encourage professional bodies, charities, and others to share any relevant insights and evidence that they have with us.

Ahead of the meeting, the LSB wrote to regulators to share the Board’s concern about the detrimental impact that unnecessary delays to disciplinary proceedings against legal professionals could have on public protection. We asked for further information on the work regulators had done to identify and mitigate any risks associated with delays to disciplinary processes or hearings. We also asked for details of any alterations that regulators were making to disciplinary processes in light of additional delays caused by Covid-19. We received a response from all the bodies except BSB.  Those who responded had clearly turned their attention to considering the risks, but the range of mitigations differed. We will seek clarification on some matters and then consider whether any further action is needed.

Practice Certificate Fee Review:

We discussed the new draft rules of the Practice Certificate Fee (PCF), which we will consult publicly on this summer. We have engaged with regulators throughout the process so far, to understand and consider the range of perspectives.

The new draft rules are intended to increase transparency about the cost of regulation, for both consumers and providers. For example, New draft rule F: allocation of practising fee to permitted purposes sets out that the Approved Regulator (AR) will have to outline the delineation of funds raised by PCF that will be allocated to the Regulatory Body (RB) and the amount retained by the AR, and further, the programme of activity to which these amounts will apply.

The LSB intends that the benefits of the new draft rules on ARs and RBs and their regulated community will outweigh any costs associated with compliance; the new draft rules are designed to provide clarity for those that pay the PCF on how their money is spent. We anticipate that this will result in a more meaningful debate on the purpose, benefits, costs and value of regulation, which in turn will lead to improvements in standards across the sector.

Diversity:

Following years of limited movement in increasing diversity and inclusion in the legal services sector, the LSB will use our oversight role more effectively to deliver greater progress.

At our January Board meeting we agreed an initial assessment on the performance of regulators against three characteristics:

  1. an understanding of the composition of their regulated community
  2. an understanding of the barriers to entry and progression within the regulated community, and a programme of activity to mitigate those barriers with measures in place to evaluate effectiveness, and
  3. measures in place to understand any differential impact on protected characteristics within their disciplinary/enforcement procedures.

Against these characteristics there were some disappointing results. Only three of the regulatory bodies (BSB, ICAEW, SRA) were able to demonstrate a comprehensive understanding of the composition of their regulated community. Although most regulatory bodies were able to demonstrate some understanding of the barriers to entry within the regulated community and are addressing them, it does not appear that effective evaluation practices are routinely used to mitigate against these barriers.

Meanwhile, no regulator was able to demonstrate that they currently have a comprehensive understanding of whether their disciplinary/enforcement procedures disproportionately impact certain groups. There are shortcomings in the collection of diversity data across the sector and there is also no consensus on what types of interventions have been successful to meaningfully improve diversity across all the protected characteristics.

The LSB is committed to working further in this area and exploring various projects such as an evidence framework helping regulatory bodies collect and evaluate the right data to show which interventions have worked. The LSB will be reviewing the regulatory performance framework in 2021 to consider the most appropriate means to measure regulators’ performance on increasing the diversity of the profession.

Our focus on diversity of the profession will progress alongside our work towards understanding how BAME consumers experience access to justice and the service they receive by legal providers. This is an issue we plan to work closely with the Consumer Panel and our recently established Public Panel.

Ongoing competence project update:

Our call for evidence formally closed on 26 June. We had a great response with over 40 submissions from a range of organisations such as regulatory and representative bodies, other sector regulators, consumer groups, government bodies and academics. We will continue to encourage submissions . We are also on track to have met with around 50 targeted stakeholders, all of which have provided useful insights. We are now beginning our analysis of the submissions where we expect to draw out a set of themes for further discussion with stakeholders and the public panel later this year.

LSCP Annual Report:

The Consumer Panel presented their Annual Report 2019/20 and discussed their work and impact over the last year and their upcoming projects. We all agreed that more work needs to be done to promote the importance of Quality Indicators and price transparency. We have a shared goal of diversity and Sarah Chambers, the Chair of the Panel, outlined that this was their ‘number one focus for the coming year’.

The annual report will be published shortly.

Goodbye to Board member David Eveleigh

We thanked David Eveleigh, who steps down after two terms for his distinguished service.


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