BAR PRACTISING CERTIFICATES (Hansard, 22 June 1999)

HC Deb 22 June 1999 vol 333 cc1028-37 1028

§ '.—(1) If the General Council of the Bar makes rules prohibiting barristers from practising as specified in the rules unless authorised by a certificate issued by the Council (a "practising certificate"), the rules may include provision requiring the payment of fees to the Council by applicants for practising certificates.

§ (2) Rules made by virtue of subsection (1)—

(a) may provide for the payment of different fees by different descriptions of applicants, but
(b) may not set fees with a view to raising a total amount in excess of that applied by the Council for the purposes of the regulation, education and training of barristers and those wishing to become barristers.

§ (3) The Lord Chancellor may by order made by statutory instrument—

(a) amend subsection (2)(b) by adding to the purposes referred to in it such other purposes as the Lord Chancellor considers appropriate, or
(b) vary or revoke an order under paragraph (a).

§ (4) No order shall be made under subsection (3) unless—

(a) the Lord Chancellor has consulted the Council, and
(b) a draft of the order has been laid before, and approved by a resolution of, each House of Parliament.

§ (5) No provision included in rules by virtue of subsection (1), and no other provision of rules made by the Council about practising certificates, shall have effect unless approved by the Lord Chancellor.

§ (6) The Council shall provide the Lord Chancellor with such information as he may reasonably require for deciding whether to approve any provision of rules made by the Council about practising certificates.'.—[Mr. Vaz.]

§ Brought up, and read the First time.

§ Mr. Vaz
I beg to move, That the clause be read a Second time.

§ Mr. Deputy Speaker (Mr. Michael J. Martin)
With this, it will be convenient to discuss Government new clause 7—Fees for solicitor's practicing certificates.

1029

§ Mr. Vaz
The new clauses relate to practising certificates for barristers and solicitors. Most solicitors are already required to hold practising certificates under the Solicitors Act 1974. The certificates, which are renewed annually, are evidence that the solicitor is properly qualified, and that he or she has abided by the various requirements placed on solicitors, such as having satisfactory insurance arrangements and having paid their dues to the Law Society.
New clause 6 enables the General Council of the Bar for the first time ever to require barristers to hold and pay for practising certificates on a similar basis. It also limits the purposes to which the Bar Council may apply the income that it receives from practising certificates, which will effectively be compulsory subscriptions.
The Law Society already has a statutory power to levy fees for practising certificates, but there is currently no statutory restriction on the society's use of its compulsory fee income. New clause 7 enables the Lord Chancellor to limit the purposes for which the Law Society may apply fee income from practising certificates.
The Government believe that it is right for a regulatory body to be able to charge compulsory fees to those whom it regulates. The Opposition tabled an amendment in another place that would have enabled the Bar Council to charge compulsory fees. That amendment was flawed, but my noble Friend the Lord Chancellor said that active consideration would be given to tabling a suitable amendment at a later stage.
The Bar Council carries out a regulatory function in relation to barristers, which is comparable to that exercised by the Law Society in relation to solicitors but, unlike the Law Society, the Bar Council has no statutory power to enforce the payment of subscription fees by its members. It is estimated by the Bar Council that 10 per cent. of practising barristers currently do not pay their subscription fees. The Government agree that it is unfair that some barristers should not contribute to the costs of the regulation from which all barristers benefit.
The new clause will also enable the Bar Council to require barristers to pay what amounts to a training levy to support pupil barristers or to provide other training. At present, many new barristers, after attending the Bar vocational course and being called to the Bar, are unable to obtain pupillages, and their careers fall at the first fence.
The Government hope that the Bar Council will choose to exercise its new power. It should be a potent means of ensuring more meritocratic entry to the Bar, which suffers from an excessively middle-class image. In short, it is not at present open to all the talents.
The Dearing review made it clear that individuals and professions should be expected to pay for such postgraduate vocational training. At present, neither the year in which the professional qualification is gained, nor the pupillage year, is grant aided. That operates as a powerful deterrent against entering the profession for people from ordinary backgrounds.

§ Mr. Grieve
I have no objection to the new clause, but I would not want it to go unsaid that, as the Bar currently operates, a large number of chambers supply substantial grants to their pupils to help them to complete their pupillage year.

1030 9.45 pm

§ Mr. Vaz
The hon. Gentleman is right to remind us that they do that, and it is not only wealthy personages who are able to come here and become barristers. Those training opportunities are very important. I believe that the funding would help to ensure for the future that more people not from privileged backgrounds are able to rise to success at the Bar.
On the detail of the clause, subsection (1) will enable the Bar Council to make rules requiring the payment of compulsory fees for practising certificates for those barristers who provide legal services to the public or to an employer. Subsection (2) provides that the rules on practising certificates may set different fee levels for different classes of barrister, for example according to whether they are employed, non-practising or in private practice or according to the length of time since they were called to the Bar. Subsection (2) also provides that the total amount of money generated from the payment of those fees should not exceed the Bar Council's total expenditure on the regulation, education and training of barristers and would-be barristers.
The Government have considered whether the total amount of fees from compulsory subscriptions should also be available for use on what might be described as the Bar Council's trade union activities. Our view is that they should not. The Government have no intention of creating a closed shop, requiring individual barristers to fund activities which they may not support and may, in fact, be contrary to their interests. Of course, it will be open to the Bar Council to raise money from barristers on a voluntary basis for those purposes, but the days of pre-entry closed shops are ended for trade unions and should not apply to other bodies either.
Nevertheless, the Government accept that there may be other purposes for which it would be appropriate for the Bar Council to use money generated from subscriptions. In considering that possibility, the Government would be guided by the wider public interest. Subsections (3) and (4) therefore enable the Lord Chancellor to add by order to the purposes in subsection (2). The order would be subject to prior consultation with the Bar Council and to affirmative resolution of each House of Parliament.
Subsection (5) requires that the Bar Council's rules on practising certificates be made with the concurrence of the Lord Chancellor who, under subsection (6), may, when deciding whether to approve such rules, request additional information from the Bar Council.
The chairman of the Bar Council, Dan Brennan, has welcomed the proposed introduction of new clause 6. His view is that the clause safeguards the income that is essential to our work in regulating the profession in the public interest, and will protect the future of high calibre training and education for the Bar. It is appropriate in our view that all members of the Bar, who enjoy the benefits and services which the Bar Council provides, should pay their fair share of the cost incurred in providing these services. I want to place on the record the Government's thanks to Dan Brennan and the Bar Council for all the work they have done to facilitate the formulation of this change.
On new clause 7, at present, under section 11(3) of the Solicitors Act 1974, fee income may be applied in any manner that the Law Society may think fit. In Committee, my hon. Friend the Member for Southampton, Test (Dr. Whitehead), who is in his place, tabled an amendment that 1031 sought to apply the same restrictions to the Law Society as the Government intend to apply to the Bar. That would have had the effect that practising certificate fees could be used only for the regulation, education and training of solicitors. A large number of other hon. Members expressed their support for the purpose of that amendment. In replying, my predecessor, the hon. Member for Ashfield (Mr. Hoon), said that there was a strong case for such a restriction, but that the Government needed to consider the position carefully before disturbing an arrangement that had been in place for many years.
The Government's initial view, which they conveyed to the Law Society, was that the restriction should be imposed in the same way as for the Bar Council. As I explained in relation to the new clause on Bar practising certificates, our belief is that it is right in principle to define how a professional body may spend money generated from compulsory subscriptions. The Government therefore support a restriction. I am aware that many solicitors would welcome such a move and feel that it would help to ensure that the Law Society remained answerable to the profession. Furthermore, there is a strong argument that the Law Society should be placed on an equal footing with the Bar Council.

§ Mr. Kidney
I was not one of the large number of hon. Members who expressed support for the new clause in Standing Committee. The new clause would limit what the Law Society could spend its members' money on. At its best, the legal profession is effective in its communication, fearless in its independence and passionate in its defence of liberty and democracy. If the Law Society used those skills in defence of an existing law that the Government wanted to change or to promote a law reform that the Government resisted to such an extent that it became embarrassing for the Government, will my hon. Friend assure me that that would not be a reason for the Government to exercise the power proposed in the new clause?

§ Mr. Vaz
My hon. Friend should wait to hear what I have to say, but I can assure him that we have thought very carefully about the matter. The challenge is as much for the Law Society as for any other organisation. There is no question of trying to prevent the Law Society from doing what it wants to do. However, it is right that it should put up a case for the way in which that income should be spent.
There was pressure on the Government to introduce the power in the new clause immediately, and that pressure was evident in the amendment tabled by my hon. Friend the Member for, Test. We did not do so, because we listened carefully to what the Law Society had to say. Indeed, my noble Friend the Lord Chancellor met the president of the Law Society, Mr. Michael Mathews, to discuss the Government's position. I was present at that meeting.
Mr. Mathews made some extremely important and useful points at the meeting, some of which related to what my hon. Friend the Member for Stafford said, and some of which have been incorporated in new clause 7. I want to thank Mr. Mathews for the cool, intelligent and thoughtful way in which he approached this issue and deployed his arguments.
1032 As a result, the Government accept that immediate change could be disruptive and unhelpful. We have taken into consideration the full flexibility that the Law Society currently enjoys in the use of its income. The new clause therefore makes no immediate change to the position of the Law Society, but enables Parliament to decide what restriction might be appropriate when the Government—and the Law Society—have had time to consider the issues fully.
Indeed, that debate has started already. It is not for me to intrude on the Law Society's private arrangements, but candidates in the on-going presidential election have rightly started to debate this matter already, albeit in rather colourful language.
We have asked the Law Society to state, within the next 18 months, what activities it believes should be paid for out of compulsory fee income and what activities should be properly funded on a voluntary basis. Therefore, as I told my hon. Friend the Member for Stafford, the challenge is with the Law Society. The Government would be prepared to consider proposals that went beyond the regulation, education and training of solicitors if they were clearly in the public interest or had the overwhelming support of Law Society members. My noble Friend the Lord Chancellor would then be in a position to put fully considered proposals to Parliament.
It is perfectly possible that Parliament may decide to allow the Law Society to raise fees for a wider range of activities than is currently proposed for the Bar Council.

§ Mr. Grieve
In a sense, the Minister has already answered my question. A little while ago, he said that he was intending to put the Law Society on the same footing as the Bar Council. However, a comparison of the minutiae of new clauses 6 and 7 shows that that will not happen unless or until the order has been laid before Parliament.

§ Mr. Vaz
When the hon. Gentleman looks at Hansard tomorrow, he will see that I did not say that. I said that that was one of the options. He was too busy chatting to the hon. and learned Member for Harborough (Mr. Garnier) and the hon. Member for Surrey Heath (Mr. Hawkins) to give proper consideration to what I was saying. I said that the Government will be prepared to consider the proposals, which went beyond the regulation, education and training of solicitors, if that was clearly in the public interest and if the overwhelming majority of Law Society members favoured such a scheme. I added that it is perfectly possible that Parliament may decide to allow the Law Society to raise fees for a wider range of activities than is at present proposed for the Bar Council. The new clause on Bar practising certificates would enable Parliament to place the Bar's use of fees on the same basis, if that were considered to be the proper outcome.
Subsection (1) of new clause 7 enables the Lord Chancellor to make an order to amend section 11(3) of the Solicitors Act 1974 to restrict the purposes for which the Law Society may apply its fee income. That would leave the regulation, education and training of solicitors, and would-be solicitors, at an irreducible minimum. Subsection (1) would also enable the Lord Chancellor to add to those purposes other purposes that are considered appropriate.
Subsection (2) requires that any order made by the Lord Chancellor should be subject to prior consultation with the Law Society and the Master of the Rolls, and to approval by affirmative resolution of both Houses of 1033 Parliament. I hope that the hon. Member for Beaconsfield (Mr. Grieve) and my hon. Friend the Member for Stafford (Mr. Kidney) are reassured that those processes will have to be completed before the matter is finally determined.
The Government cannot support a situation in which Law Society members are compelled to join a closed shop in order to practise. At the same time, we have no wish to stifle the many useful functions that the society currently performs in the public interest. The Government have listened to the Law Society's concerns and to the issues raised by hon. Members. The clause is an appropriate means of dealing with them and I commend it to the House.

§ Mr. Garnier
I shall be brief because the timetable motion requires the debate to finish by 10.15 pm. My brevity should not be taken as wholehearted support for what the Government are doing.
The chairman of the Bar may well have wanted new clause 6, but I suspect that he wanted it for reasons different from the Minister's. It would be interesting to compare the words of Mr. Daniel Brennan with those of the Minister to see whether they matched.

§ Mr. Vaz
They were his words.

§ Mr. Garnier
They were not only his words. I dare say that the Minister used some of Mr. Brennan's words, but he also used his own, or at least those of his civil servants, which he may have read for the first time this afternoon.
New clauses 6 and 7 cause me concern. New clause 7 seems to be a direct consequence of the Law Society's advertising campaign in March and April, when the Lord Chancellor was stung into conducting a rather ill-tempered debate on Radio 4's "Today" programme. He used fairly intemperate language either in a discussion with Mr. Mathews, the president of the Law Society, or shortly after Mr. Mathews had spoken on the radio.
New clause 7 is the result of pique. It has been produced by a Government and a Lord Chancellor who will brook no criticism. The Lord Chancellor is not prepared to have debated in public any matter of which he disapproves. He—like the Government—finds it uncomfortable to be disagreed with. New clause 7 is the result, introduced out of pique.

§ Mr. Vaz
The hon. and learned Gentleman is absolutely obsessed with the Lord Chancellor. I shall arrange a meeting for him so that he may see that the Lord Chancellor cares deeply for the professions. None of what the hon. and learned Gentleman has said about the Lord Chancellor fits my noble Friend. The hon. and learned Gentleman can take my word for it that new clause 7 has nothing to do with any Law Society advertising campaign.

§ 10 pm

§ Mr. Garnier
I believe that the Minister believes that to be the case, but I do not accept that it is credible. No one who heard the Lord Chancellor, or saw his reactions to the advertising campaign, could marry up the arrival of new clause 7, or the threat of such a clause, with what the Minister says. I do not doubt his sincerity or that he believes what he has just told us, but he is being naive.
1034 I have a further complaint about new clause 7, because it could amount to a denial of freedom of expression. Article 10 of the European convention on human rights, to which the Government attach so much importance that they passed the Human Rights Act 1998, allows freedom of expression. If solicitors, through their Law Society, wish to express themselves in a way that is antipathetic to the Government's policies, what right have the Government to intervene to stop them? That is the hidden agenda, if not the effect, of new clause 7, and it is much to be deprecated.
We are used, of course, to this Government bullying and arrogantly trying to wish their demands on the population. We are used to their ignoring Parliament and we have become used in discussing the Access to Justice Bill to them giving themselves and the Lord Chancellor huge executive powers through secondary legislation, some by negative and some by positive resolution. This coat-hanger Bill gives the Lord Chancellor huge executive powers. The new clause is yet another example, introduced at a late stage. It is reasonable to comment on the fact that we know that the motive for introducing it is quite different from what the Minister fondly believes. That is much to be deprecated. I shall not press it to a vote, bearing in mind the time, but it is right to signal our disapproval of how the Government go about such things, as evidenced by new clause 7.

§ Dr. Alan Whitehead (Southampton, Test)
I join my hon. Friend the Member for Stafford (Mr. Kidney) in welcoming my hon. Friend the Minister to his new duties. I wish him a long and adventurous career in his new post. I also need to declare an indirect interest. I think that I am almost unique in the Chamber in not being a lawyer.

§ Mr. Martin Linton (Battersea)
No.

§ Dr. Whitehead
There is one other non-lawyer. However, my wife is a salaried local authority lawyer and does a very good job.
Far from giving rise to the concern expressed by the Opposition, new clause 7 results directly from new clause 22, which I tabled in Committee. I commend the Minister for putting into the new clause the principle that I advanced in Committee. As he pointed out, section 11(3) of the Solicitors Act 1974 states: All fees received by the Society under subsection (1) shall be applied in such manner as the Society may think fit for the purposes of the Society". Each year, that fee is charged for a practising certificate. The Law Society has the sanction of the law to charge it. Lawyers are required to pay it even if they do not join the Law Society, and the society can add various levies to it that are also enforceable by law. As far as I know, that is unique. No other professional society, trade union or organisation has such a power enforceable in law in the United Kingdom. I cannot believe that that is right.
I can believe that it is right and admirable that the Law Society charges a fee for the good work that it does. Everyone accepts that it does good work in setting professional standards, maintaining them, training the profession and, above all, regulating it. Those are wholly appropriate things for which to charge a fee, but the society should not have a power in law to do anything else that it wants to. It has been suggested that to say that 1035 this unique position needs to be examined is somehow an attack on the raison d'être of the Law Society. That is nonsense. It is within the power of any society to levy a charge on its members for purposes for which it wishes to raise money. Indeed, I imagine that that is what, after discussion, the Law Society will do.

§ Mr. Dismore
We heard some talk earlier of the Law Society's anti-legal aid reform campaign. I am sure that my hon. Friend is aware that the Law Society is not the only trade union operating in the legal profession. I am a member of the GMB, which is recognised by a number of law firms. If the GMB had been so stupid as to try to run a similar campaign, it would have had to pay for it out of its political fund, which is the subject of a separate ballot of members, a right to opt out and a separate levy identified as part of the subscription.
Does my hon. Friend agree that it is peculiar that the Conservative party justifies the position of the Law Society under the present arrangements, bearing in mind the strong attitude that it took when in government to trade union political funds?

§ Dr. Whitehead
My hon. Friend makes a pertinent point that I do not now need to make. It is suggested that the Law Society has immunities, privileges and powers in law that are not available to trade unions and which have been the subject of extensive debate in the House. Yet restrictions on trade unions' powers in this respect were advocated by the Conservative party.
In summary, the reason why I tabled the proposal in Committee was to bring to the Government's attention the principle that the Law Society should not be above the law, as it were. The Law Society should be subject to the same conditions as are assumed to apply to other professional societies. I am glad that the Government have discussed that suggestion with the Law Society. I am pleased to hear that the Law Society has listened carefully to it and appears to be willing to discuss with the Government exactly how such changes might be made.
So the conclusion to the new clause is a happy one. Somewhat to my surprise, I have had a postbag containing letters from solicitors who think that this is a long overdue reform which puts right a wrong that they perceived to be inherent in the Solicitors Act 1974. Despite the protestations of various solicitors, I think that we will eventually achieve a method of regulation for both the Law Society and the Bar Council, which are similar; this anomaly will be rectified, and it will be done in a civilised and straightforward way. I congratulate my hon. Friend the Minister on putting the principle of what I suggested into a new clause and amendments which will work in the interests of all concerned in a way guaranteed to enhance the legal profession rather than to preserve indefensible anomalies.

§ Mr. Burnett
In view of the time, I shall make just a few points about new clause 7. It is deeply to be regretted that the Bill time and time again operates to arrogate more powers to the Lord Chancellor. Is there no area of the law that the Lord Chancellor does not seek to control and dominate? He is a prominent and powerful member of the Executive and the legislature, and he is the senior judge 1036 in the land. He now seeks to undermine the independence of the Law Society, taking powers to take control of many of its affairs.
I have had the privilege of serving on the Law Society's revenue law committee for some 12 years. In opposition and in government, Labour Members have had every reason to be grateful to that specialist committee and to the other specialists committees of the Law Society, which do excellent work in the public interest. That is an example of one sphere of the work of the Law Society over which the Lord Chancellor wants to take control.
It is fundamental to the constitution of any free country that the legal profession be independent. Liberal Democrats strongly oppose new clause 7; it is a vindictive measure against the Law Society for, rightly—I stress, rightly—opposing the removal of legal aid for personal injury cases. The measure will save no money and will prejudice the poor and the vulnerable.

§ Mr. Vaz
Goodness gracious, Mr. Deputy Speaker. I do not know what has become of the hon. Member for Torridge and West Devon (Mr. Burnett). Where has he been? What has he been taking? There is no reason to get all worked up about this measure. We are not doing anything to the Law Society; we have merely put a challenge to the society that it should justify its use of compulsory fees, over and above what we have proposed. There is plenty of time for people to consult, to put up a case and to put forward their views.
At the moment, the hon. Gentleman is busy discussing tactics with the hon. and learned Member for Harborough (Mr. Garnier), but I can reassure the hon. Gentleman that we introduced the measures because we believed it right to do so. My hon. Friend the Member for Southampton, Test (Dr. Whitehead) made several points—incidentally, I too pay tribute to my hon. Friend's wife; I am sure that she does an excellent job. He raised the whole issue of whether the measure seems to conflict with the European convention on human rights. It could be argued that an unfettered power to raise compulsory subscriptions conflicts with that fundamental human rights convention.
As to whether the measure is a vindictive act in a great conspiracy in which we sit in darkened rooms in the House plotting the downfall of the Law Society—that is, of course, rubbish. The hon. and learned Member for Harborough reminds me of the character from the film "In the Line of Fire" who is obsessed by a particular person. If we broke into his upstairs room, we should see cuttings of the Lord Chancellor pasted on the walls of that darkened room. The fact is that the new clauses are carefully thought out; as my hon. Friend the Member for Test said, they have received widespread support. I am certain that they will be welcomed.
I know that the Bar welcomes the new clauses. Members of the Bar have a responsibility, and they too face a challenge. At my last meeting with the chairman and the vice-chairman of the Bar—the hon. Member for Surrey Heath (Mr. Hawkins) is a former member of the Bar Council and will be aware that it has been campaigning for these changes for many years—they were happy to rise to the challenge and to put forward a case.
Of course, the Bar and the Law Society still have access to voluntary funds and will be able to use them to fund the activities that have been referred to. As I have made clear, nothing will happen for 18 months. They will have an 1037 opportunity to put up a case and to rise to the challenge. I am confident that all the articulate, intelligent, clever and hard working members of the Law Society and the Bar Council will be able to enter a dialogue with the Government. That is all we seek to do.

§ Question put and agreed to.

§ Clause read a Second time, and added to the Bill.