HC Deb 23 October 1973 vol 861 cc1206-17

3.14 a.m.

The Solicitor-General (Sir Michael Havers)

I beg to move, That the Legal Advice and Assistance (Financial Conditions) (No. 2) Regulations 1973, a copy of which was laid before this House on 18th October, be approved.

Mr. Deputy Speaker (Sir Robert Grant-Ferris)

I think it will be for the convenience of the House if this and the following three regulations are grouped together.

The Solicitor-General

With the permission of the House, I will deal with these four regulations together.

The two regulations relating to England were laid on 18th October and the two relating to Scotland on 22nd October. The provisions are the same on both sides of the border, but the regulations fall into two groups. The Legal Aid (Financial Conditions) Regulations relate to eligibility for legal aid and the Legal Advice and Assistance (Financial Conditions) (No. 2) Regulations relate to legal advice and assistance.

The legal aid regulations increase the financial limits within which people are eligible for legal aid, by increasing the income limits within which people are entitled to that aid. The present limits are £300 for free legal aid and £950 at the top end for contributory legal aid, and these figures were fixed in 1970. The limits relate not to actual income but to what is called "disposable income"; that is to say, the income which an applicant can be expected to receive during the 12 months from the date of his application, after deductions are made in respect of maintenance of dependants, repayment of loans, hire purchase, income tax, expenses of employment, rates, rent and other matters for which provision can reasonably be made. Thus, the figures which I have given do not set the limits as low as they seem, as allowances must be made for the appropriate deductions in each particular case. The regulations increase these limits to £375 a year for free legal aid, and to £1,175 a year for contributory legal aid, which amounts to increases of 25 per cent. and 24 per cent. respectively.

If one looks then at what the gross income will be, it comes to this. For a single man now it is a minimum of £616 and a maximum of £1,617. Under these regulations, those figures will go up to £733 and £1,965 It one goes to the other end of the scale, for a married couple with three children aged, for example, 4, 8 and 13, with an income including £1.90p family allowance, in future the maximum gross income for a free certificate where no contribution is made will be £1,420, and the minimum gross income required to come out of the scheme and not be allowed to participate will be £2,654. So the figures or £375 and £1,175 have to be looked at in relation to those gross earnings in those cases where various assumptions have been made for example, that the rent is £3 a week and there are hire purchase and insurance commitments amounting to £104 a year.

Unfortunately, because of the present financial stringency and the need to contain public expenditure, it has not been possible for the Government to accept the recommendations of the Lord Chancellor's Advisory Committee in full. As the House will recall, the committee recommended limits of £400 and £1,250 respectively. The Government accept that it is unsatisfactory now to review income limits at irregular or lengthy intervals, and this is a considerable and important concession. In future, it is proposed that they should be reviewed annually, so as to ensure that they do not compare unfavourably with, for example, the periodic increase in supplementary benefits. This is an advance which I hope will go a long way to assuage hon. Members' disappointment that, in fact, we have not been able to accept the Advisory Committee's recommendations in full.

So far as the advice side is concerned, the regulations at present allow for £20 at the top end. The new regulations increase to £24.50 per week, the maximum income which a man may have if he is to be allowed legal advice and assistance under the 1972 Act. That again is disposable income, not gross income. These limits are, broadly speaking, the same as the legal aid limits, and although on paper the legal advice limits may appear higher, because I worked out the £24.50 a week as £1,274 a year as opposed to £1,175 on the legal aid figures, the reason is that on the legal advice procedure, where one goes for what is called the £25 scheme with a solicitor, this is simplified as much as possible There is no assessment by the Supplementary Benefits Commission there. So the £104 which is allowed for insurance and hire purchase in the legal aid scheme is built in automatically, and one adds £104 to the £1,175 and one comes to almost exactly the same figure relating to the two schemes. The regulations do not alter the capital limit for legal advice and assistance which came into operation on 2nd April this year.

I should point out that these regulations must be read with a third set of regulations which the House does not have to consider tonight since they are not subject to affirmation resolution but will come into force at the same time. Those are the Legal Aid and Advice Financial Provisions (No. 3) Regulations, which deal with the lower end of the scale where the figure has been increased from £11 to £12.50 as the disposable income above which a person in receipt of advice and assistance is required to pay a contribution.

The scale of contributions has been altered, starting at £1 for a person with a disposable income between £1,250 and £1,350, rising by eight stages of £2 to £15 for a person with a disposable income up to the limit. As some idea of what cost is involved here on the legal aid side of this improvement, in the year 1974–75 it is expected to involve extra expenditure of about £916,000, going up to the year 1977–78 to £1,017,000. The other side of the coin is that it will reduce the contributions of a large number of people who are already enjoying legal aid but whose contributions have not been completed. It will mean that in the future each year about 9,800 people, who at the moment would be bound to make a contribution, will not have to make any contribution, and it is expected that there will be some 7,500 people who ordinarily would not qualify will qualify and about 36,000 people will have to pay less.

With regard to the legal advice scheme, some 8,500 more people who would now be liable to pay a contribution will be exempted from contribution and about 28,000 people will pay a smaller contribution. So for a comparatively small increase, somewhere in the region of 24 to 25 per cent., there is this marked increase in benefit to those who we hope will be able to take advantage of it. This appears, in our view, to be an improvement which I am sure the House will welcome, and I commend these regulations to the House.

Mr. S. C. Silkin (Dulwich)

On this side of the House we give a grudging welcome to these regulations—a welcome because we have been pressing for a long time for increases in these schemes, not so much to bring more people in but to bring people who have floated out back into the area of legal aid and advice.

May I say in passing that we welcome also the proposal which the hon. and learned Gentleman has put to the House, that in future the review should be annual, but a grudging welcome because, as the Solicitor-General mentioned, these regulations do not go as far as we would have wished and as the Lord Chancellor's Advisory Committee has recommended.

The House will be aware that in matters affecting the legal aid scheme and the £25 scheme the Lord Chancellor and the Government have the great advantage of having regular reports from the Lord Chancellor's Advisory Committee. It is a small but expert body composed of both lawyers and lay men and women. We on this side do not invariably agree with its recommendations, but where we find ourselves compelled to differ it is usually because we want to go faster and the committee wants to go slower; we want to be more radical and the committee prefers a more conservative approach. But we have great respect for the advisory committee's views, as I am sure have the Lord Chancellor and the Law Officers.

During the period since the income limits for legal aid were last amended in 1970 and since the Legal Advice and Assistance Act fixed the initial limits for legal advice under the £25 scheme, there have been a number of reports by the advisory committee making recommendations on these matters. Therefore, it might seem a little strange and at first sight even a little discourteous that the advisory committee is not even mentioned in the explanatory notes to these orders. But, having compared the reports with the orders, my conclusion is that it is not a lack of courtesy which accounts for the omission. It is shame on the part of the Government.

As the Solicitor-General agreed, the Government have plainly ignored the recommendations of the advisory committe and produced instead some mean little orders with mean little contents. The Government's proposed increases not only fall well below those recommended by the advisory committee in its report for the year 1970–71. In addition, the proposed increases in these orders come into effect very much later than proposed by the advisory committee, despite the fact that there has been rampant inflation in the meantime.

In its 1971 report, the advisory committee rightly pointed out in paragraph 15 that the method of assessing a litigant's resources works fairly so long as inflation is controlled. When it is not controlled the system can only be satisfactory if the minimum limit below which no contribution is paid is regularly raised and other limits accordingly. It pointed out that although the limit had been fixed as recently as 1970, none the less by 1971 it had already fallen behind.

The practice in the past has been to try to produce a rough equation between the minimum income limit for legal aid and the equivalent supplementary benefit allowance, though the legal aid limit has been somewhat higher. But by 1971 the minimum income limit for legal aid had fallen to a point £1.60 below the equivalent supplementary benefit allowance, and the committee thought that it was likely to fall further. For that reason, and at that early stage, it was pressing for an urgent solution to the problem. The Government took no action on that report.

In 1972 we had the £25 scheme—the Legal Advice and Assistance Act. Before it was enacted the advisory committee gave urgent attention to the income limits. During the passage of the Legal Advice and Assistance Act, the House will recall that the Opposition repeatedly urged the Government to increase the limits which were to be put in the Act. I can recall saying in Committee, and in the later stage, that the limits were already out of date. Unfortunately, we urged to no avail, except that it is possible that our pressure on the Government may have been partly responsible for the advisory committee taking the unusual course of issuing an interim report which was signed in January and printed in February.

In the report the committee made it clear that it regarded a rise in the income limits as urgently necessary. Indeed, that was the point of issuing an interim report. The report reiterated that minimum income limits were falling farther and farther behind supplementary benefit allowances. In addition, it expressed the firm view that it was essential for the limits to be raised in time for the coming into effect of Part I of the Act of last year on 2nd April 1973. It urged that the limits should be fixed at a level higher than the relevant supplementary benefit limit.

The report gave a striking account of how the legal aid limit had fallen relative to the supplementary benefit limit. It is worth noting the figures. In 1949, when the first Act came into being, the limit for legal aid was £156 and supplementary benefit was just over £62. In 1960 legal aid was £250 and supplementary benefit was £130. In 1970 legal aid was £300 and supplementary benefit had crept up to £270. By 1973 legal aid was still at £300. It had been overtaken by supplementary benefit, which was over £340.

The advisory committee recommended in the light of those figures, and of the likely upgrading of supplementary benefit, that £400 should be fixed as the legal aid limit from 2nd April. The Government's reply to that advice has been to fix the level at £375 not from 2nd April but from January of next year. That is despite the unprecedented inflation which we have had in the meantime.

The upper limit has been £950 since 1970. The advisory committee pointed out that to keep pace with inflation since 1970 the figure should by. 1973 be £1,137. To bring in a few extra people who would otherwise suffer hardship, they being just above the limit—there are many who suffer that hardship—it recommended a new upper limit of £1,250. That is by no means an inflated sum. The Government reply to that has been £1,175. The advisory committee recommended corresponding increases for legal advice and assistance so that the eligible range would rise from £20 disposable income to £27 and from £11 to £13. Again, the Government's reply has been something lower than that—namely, £12.50 instead of £13 at the bottom end. That is a difference that seems hardly worth making. Then there is a figure of £24.50 at the top instead of £27.

All these figures under the Government's orders are to take effect from 1st January next, despite the inflationary pressures since the date recommended by the advisory committee. The advisory committee gave the Lord Chancellor its estimate of the cost of its proposals. It thought that the legal aid increases would cost £1½ million in a full year and that the £25 scheme increases would do no more than restore the figures to their 1970 value.

The House would wish to know what miserable sums the Government will save by these miserable orders. Is the advisory committee right to say about its proposals that there would be no real effect on the cost of the £25 scheme? If so, is the effect of the Government's figures to reduce the cost of the scheme? If so, how do the Government justify that?

Ever since the Legal Advice and Assistance Bill was brought before the House, and particularly since the interim report, we have been pressing the Government again and again to raise the figures. My hon. Friend the Member for Hackney, Central (Mr. Clinton Davis)—who would have taken part in this debate had it taken place at a more reasonable hour—has been in the forefront of the battle. But the replies all the time have been negative and stalling. From what has emerged the answer is clear. The Lord Chancellor, powerful though he is, has had to engage in a battle with the Commons Chancellor in the process, familiar to lawyers, of trying to settle at the doors of the court. In the event, the Chancellor of the Exchequer won and the lord Chancellor lost.

It will be a hollow victory—a victory for cheese-poring at the expense of justice. It is the Chancellor of the Exchequer who should be here at this hour defending himself rather than the Solicitor-General, who has fought with skill and charm to protect his right hon. Friend. The Solicitor-General has our sympathy. He must realise that these miserable savings and the miserable meanness displayed by the Government are the mean and miserable hallmark of this miserable Government.

3.44 a.m.

Mr. Michael Cocks (Bristol, South)

I wish to support what has been said by my hon. and learned Friend the Member for Dulwich (Mr. S. C. Silkin), and I am sure the Solicitor-General will be pleased that at least there are hon. Members present at this time of the morning to express their disappointment at the rather stale half loaf he has presented to the House tonight.

I appreciated the way in which the hon. and learned Gentleman presented these provisions to us tonight, and I do not intend to comment in any way on there-marks already made today about the order of business, because I had a minor part to play in the "normal channels". I appreciate the Government's difficulty about bringing forward all this business at this end of the Session, but I am sure that had the business of the House been less full today, far more attention would have been paid to these orders.

The point has already been made that these increases do not even keep pace with the levels of inflation which have occurred. The advisory committee has been turned down, and it seems to me that in simply increasing the scheme by an amount not enough to cover the increase in inflation the Government are missing the whole point of legal aid.

Legal aid is not just a question of helping someone obtain professional services who could not otherwise afford them. It is part of the process of breaking down the fear of legal processes that the ordinary man in the street has. As society becomes more complex, it becomes more important to set no obstacles in the way of those who look to the law for redress.

The Solicitor-General was a little unwise to tell the House that the reason why he could not go further was financial stringency, when such a rosy picture of booming prosperity is being painted by other Ministers. Through sticking too closely to his brief he let the cat out of the bag. When he is consulted tomorrow by the Cabinet about the reception given these orders, I hope he will say that we feel that legal aid is not simply a prop, but that people should feel it is something to help them fight for their rights. Unless we are assured that, in the near future, another increase will be made—I welcome the review—not merely to keep pace with inflation but to increase the real rates, we shall begin to wonder whether the Government intend to whittle down the scale of legal aid.

There is a basic philosophical difference between the two major parties here—the Government seem to think that legal aid should be given only on sufferance, that we should be better off without it, and that, if it were gradually pared down in relation to the cost of living, one day it could be done away with altogether. It is wrong to think merely in terms of money and to discount the value of legal aid in making the ordinary citizen feel that he is not merely an anonymous unit fighting a machine— "them"—but has some protection and is a part of society.

3.43 a.m.

Mr. Caerwyn E. Roderick (Brecon and Radnor)

I support what my hon. Friends have said.

The Solicitor-General talked of a rise from £20 to £24.50 a week, an increase of 22.5 per cent., as if inflation has risen by only that amount since 1970. The figures for inflation given by other Departments are much higher. The rise does not keep pace with the cost of living over the period. The figures in 1970 were a start towards solving the problem; they were not the end of the difficulties that people had in seeking legal aid. There is an unequal society in the availability of legal aid and those who are poorest are not necessarily the worst off. A group above the bottom tier of incomes suffer considerably. They are often afraid to seek legal redress when they should get their just reward, simply because they cannot afford legal aid and are not sure that they will get it on the scale they need.

The order does not solve that problem. It does not even hold the ground. The hon. and learned Gentleman mentioned 9,000 people who would come within the category of having to contribute. What is the comparison with the 1970 figure? Are we redressing the balance with the situation as it was then? I am not satisfied that we did enough in 1970 and we should now be moving much further along this road.

I am a little concerned that the figures in the two orders are given in a different fashion—weekly income in one case and annual income in the other. The purpose is not quite clear. Is it in order to draw a little cloud over the situation?

The situation is far from satisfactory. Clearly, the intention of assisting so many people in our society has gone astray in that the Treasury has over-ruled the best intentions of people like the hon. and learned Gentleman. I am sure he would like to assure people that he would like them all to have the same kind of justice but that the Treasury has ruled otherwise.

3.47 a.m.

The Solicitor-General

There is nothing sinister in distinguishing in one order annual income and in the other weekly income. The annual income relates to legal aid which will be assistance for court cases. In such circumstances, there will be quite a lot of time during which proper assessment can be made by the Supplementary Benefits Commission, which has to assess what is going to be the gross income of the applicant for the following 12 months and then make suitable deductions for rent, income tax, rates, dependants, hire purchase and so on. That is done on an annual figure because the whole of the future 12 months is looked at by the commission. The end figure for the deductions is called the "disposable figure", and that is then divided so that one-third is contributed.

Weekly income is used in the legal advice system because the whole purpose of legal advice is that one should be able to obtain it quickly. One goes into a solicitor's office and says "I want to take advantage of the £25 scheme"—as it has become generally known—and the solicitor is provided by the Law Society with a short questionnaire which takes into account the man's income and his various outgoings which can be deducted. That is all based on weekly pay so that it can be done quickly at that moment. There is also a sort of code alongside, and the whole thing can be read off, and the solicitor can say at once whether the intending client will be covered by the scheme or not. That is the only reason why one works the weekly system on the advice scheme and the yearly system when one comes to legal aid for court actions, where the urgency does not arise in anything like the same way. I hope that the hon. Gentleman will appreciate that there is nothing sinister in those distinctions.

I almost feel tonight as if I am taking something away from those who are seeking legal aid rather than increasing the limits which are provided for them. I suppose that there will never be an occasion on which the House will be satisfied, and obviously it is so desirable that every sort of assistance should be given to those who are unable otherwise to obtain the legal advice and help in legal cases that they need.

There is no question about letting the cat out of the bag about public expenditure because this has been common knowledge and expressed by my right hon. Friend the Chancellor of the Exchequer on a number of occasions. If the cat did leap out of the bag no doubt it was chasing after the red herring which the hon. and learned Member for Dulwich (Mr. S. C. Silkin) trailed across the Floor of the House in his speech.

The annual review is perhaps the biggest improvement in the whole of the scheme which has been put forward tonight. Regarding the rest, it is true that the advisory committee has made recommendations. The increases which have been made amount to between 22½ per cent. and 25 per cent. across the board and are in each case roughly three quarters, anyway, of the figures which were recommended by the advisory committee. Accordingly, I invite the House to approve the regulations.

Question put and agreed to.

Resolved, That the Legal Advice and Assistance (Financial Conditions) (No. 2) Regulations 1973. a copy of which was laid before this House on 18th October, be approved.

Resolved, That the Legal Aid (Financial Conditions) Regulations 1973, a copy of which was laid before this House on 18th October, be approved. —[The Solicitor-General.]

Resolved, That the Legal Advice and Assistance (Scotland) (Financial Conditions) (No. 2) Regulations 1973, a copy of which was laid before this House on 22nd October, be approved. —[The Solicitor-General.]

Resolved, That the Legal Aid (Scotland) (Financial Conditions) Regulations 1973, a copy of which was laid before this House on 22nd October, be approved. —[The Solicitor-General.]

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