Legal Aid Cuts – A False Economy?

Today is the launch my of my long-awaited report on the Government’s legal aid reforms which found that for every £1 cut from the legal aid budget less than 42 pence will actually be saved from the public purse.

The Ministry of Justice (MoJ) will achieve its savings by largely cost shifting to other cash-strapped departments. For example, for every £1 saved by removing clinical negligence from legal aid funding it will cost the NHS almost £3.

As part of the Legal Aid, Sentencing and Punishment of Offenders Bill currently before Parliament, the Government is planning to save £350 million per annum through reforms to the legal aid system. The vast majority of these savings – some £279 million – are based upon altering the scope of legal aid i.e. what is covered. The proposals would remove almost 600,000 cases each year from scope including clinical negligence, (private) family law and social welfare law. As 80 percent of those receiving legal aid are in the bottom income quartile those most in need will suffer.

A key justification for the reforms was the need to save £2 billion from the MoJ budget as part of their contribution to tackling the fiscal deficit. Many commentators and stakeholders expressed concern that these proposals would generate unintended costs in other parts of the system and the Justice Select Committee even said:

 “We are surprised that the Government is proposing to make such changes without assessing their likely impact on spending from the public purse and we call on them to do so before taking a final decision on implementation.”

In response, The Law Society commissioned me to investigate the likely impact of these scope reforms on the Government’s budget.

You can read my full report and a short summary on the KCL website but the message is clear. These scope reforms will generate substantial knock-on costs (circa £139 million per annum) and the Government is unlikely to save more than 42 percent of its predicated savings. Much of the predicted savings are actually cost shifting to other areas of Government, over £80 million per annum. The proposals appear to be a false economy.

My conclusion is also clear – the Government should conduct a cross-departmental review of the knock-on costs of these proposals before they are enacted. Give Parliament the full facts on which to make a decision.

Tomorrow night the House of Lords will debate an amendment which calls for such a review. Let’s hope it gets support.

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