HL Deb 29 March 1993 vol 544 cc667-75

7.14 p.m.

Lord Fraser of Carmyllie rose to move, That the draft regulations laid before the House on 11th March be approved [24th Report from the Joint Committee].

The noble and learned Lord said: My Lords, I beg to move that the House considers five sets of draft legal aid regulations which are subject to the affirmative resolution procedure. The regulations are listed on the Order Paper.

The subject of legal aid in Scotland—and, indeed, in England and Wales—has, of course, been the subject of a considerable amount of comment in recent weeks. It may be of assistance to the House if I describe briefly the policy background against which we are bringing forward the regulations.

Legal aid is the means whereby people on low incomes may be helped to have access to the justice system. I believe that, over the years, it has been successful in that aim. However, legal aid of course involves the expenditure of very large amounts of taxpayers' money. Over the past few years, and most particularly over the last year or so, legal aid expenditure has risen dramatically. Indeed, it has almost doubled over the past five years. Expenditure on legal aid from public funds was £49 million in Scotland in the year ending 31st March 1988. That had risen to £83 million in the year ending 31st March 1992 and will reach £104 million in the financial year which is now ending.

It is not only a matter of the increase in expenditure; there have been significant and, indeed, dramatic increases in the numbers of grants of legal aid. In the year 1991–92, there were some 23,000 grants of civil legal aid. In the year now ending, that figure had risen to 27,000—an increase of some 17 per cent. In 1991–92, legal advice and assistance figures were about 272,000 in Scotland; in the year now ending, that figure rose to 287,000—an increase of 5.5 per cent. Although I understand that some noble Lords may have been briefed on the matter, and although the figures that I have just given are in the public domain following my appearance before a Select Committee in another place last week, such figures have, curiously, been omitted or concealed.

The first two sets of regulations before the House this evening represent a major element in the Government's response to that rise in expenditure. The Government have a general responsibility to ensure the best use of taxpayers' money, and to set their spending priorities accordingly. It is in that context that we have had to look—as any responsible Government would have to—very carefully indeed at the levels of expenditure on legal aid which have arisen recently.

With your Lordships' permission, I shall now describe the provisions contained in each of the sets of regulations in a little more detail.

The Civil Legal Aid (Financial Conditions and Contributions) (Scotland) Regulations 1993 adjust the threshold of a person's disposable income below which free civil legal aid is available. They propose that the threshold should be set at £2,293 with effect from 12th April 1993, when the annual adjustments in income support levels under the social security system come into effect. The upper limit will remain unchanged at £6,800 (£7,500 in personal injury cases). The maximum contribution which a person between the lower and upper limits will be asked to make towards the cost of his legal aid bill will be raised from one-quarter to one-third of his disposable income above the lower threshold.

The Advice and Assistance (Financial Conditions) (Scotland) Regulations 1993 similarly change the threshold—this time of weekly disposable income—above which a person is required to pay a contribution for legal advice and assistance. The new disposable income level will be £61 per week. The regulations also prescribe the scale of contributions to be paid where weekly disposable income exceeds £61 but does not exceed a slightly increased upper disposable income limit of £147. The level of contribution will range from £7 to £86.

I should make a number of points about the changes. In the first place, all the figures relate to a person's disposable income; that is, his income after allowance has been made for a number of necessary outgoings such as expenditure on dependants, housing costs, the costs of travel to work and other expenses associated with employment, and a number of others.

The calculation will vary significantly according to the circumstances of each individual applicant, but an applicant with a disposable income towards the upper end of the scale giving rise to eligibility could well have a gross income of something around £15,000 or even more. The levels of eligibility therefore continue to represent generous provision, and we estimate that some 55 per cent. to 60 per cent. of households in Scotland will remain eligible for legal aid under the new proposals.

The second point I would wish to make is that the contributions which are payable are in all cases maximum contributions. We have seen some newspaper comment recently which seems to imply that the maximum contribution levels are in some sense an entrance fee for access to the system of civil justice. That, of course, is not the case. As at present, no legally-aided person will be required to pay more than their case actually costs; on the other hand, however high the costs of an individual case rise, no one will be required to pay more than the maximum contribution. For those at the top levels, just within eligibility, it needs to be remembered that the average cost of consistorial cases in Scotland is in many cases, if not all, below what would be the maximum contribution.

Thirdly, I should say that our approach has not been to remove significant numbers of people from eligibility for legal aid altogether. We calculate that, of the nearly 300,000 people who received grants of civil legal aid or advice and assistance in 1992–93—the year now ending—only some 7,500, 2 to 3 per cent., would not be eligible under our current proposals. Their effect is rather to require that some people who previously made no contribution towards the costs of their case will have to make a, generally very small, contribution and that the level of contribution of those who already contribute will rise. Given the context within which expenditure has to be set, we assess that that is a fair and even-handed approach.

I turn now to the remaining three sets of regulations before the House. These give effect to the commitment by the Government during the recent passage of the Bankruptcy (Scotland) Act 1993 to extend the scheme of assistance by way of representation to cover the preparation and presentation of a petition by a debtor for the sequestration of his or her estate. The regulations will allow an eligible debtor to obtain the help of a solicitor in completing and submitting the necessary petition forms required by the court. If necessary, the solicitor can also appear in court on behalf of the debtor at any hearing relating to the petition.

This assistance is in addition to, and separate from, any preliminary advice which the solicitor may have provided under the advice and assistance scheme on the options available to the debtor. The Government's commitment to extend the scheme of assistance by way of representation was welcomed by the Opposition at the time of the passage of the Bankruptcy (Scotland) Bill. I hope that that support will continue in respect of the regulations before us this evening. I hope that I have described in sufficient detail the content of the regulations which are being brought forward for your Lordships' approval and the policy background against which they are set. I commend these five sets of regulations to your Lordships' House.

Moved, That the draft regulations laid before the House on 11th March be approved [24th Report from the Joint Committee].—(Lord Fraser of Carmyllie).

Lord Macaulay of Bragar

My Lords, from this side of the House I hope I may say that what the noble and learned Lord has outlined is a series of punitive and unjustified measures which will deprive people of access to justice. Having listened to the Minister this evening, I must ask: what is the cost of justice and what is the right to justice? Are the accountants and the Treasury now telling us what justice is all about? The noble and learned Lord made reference to the number of legal aid certificates. That is a statistic but it does not necessarily translate into immediate payments—no doubt the accountants would like that to be the case—because cases may settle extra-judicially and there is the matter of the recovery of expenses from defenders or from pursuers in cases where legal aid has been granted. I shall return to that point later.

The draft regulations as a whole have some good points but I intend to concentrate on the bad points. Without wishing to personalise the matter, I wish to read from a report in The Scotsman of Thursday of last week. It states: The Law Society has urged the Government to postpone the changes in civil legal aid for one year because it believes the rise in spending on it is a temporary blip. Lord Fraser said that the Scottish Legal Aid Board's best estimates indicated a continued rise in caseloads and expenditure. Asked outside the committee if he felt uncomfortable about the Scottish Office plans being so heavily criticised by the legal profession, he said: 'No. They would, wouldn't they? It's just good trade union stuff". The noble and learned Lord will no doubt inform the House whether he has been quoted correctly. I find his comments a sad approach to the administration of justice in Scotland.

The Minister in another place introduced—I believe he did so the day after the noble and learned Lord the Lord Chancellor had introduced measures for England—what I can only describe as a back-to-back piece of legislation which tries to apply to Scotland the provisions which relate to the increases in legal aid costs in England. We all know that there is no way one can compare the two systems. I do not have the relevant figures to hand, but they show that between 70 and 80 per cent. of jury trials in Scotland are conducted by solicitors. In England all jury trials, as I understand the position, are conducted by counsel and counsel are usually on legal aid. Therefore in comparing the two systems we are not comparing like with like.

The President of the Law Society of Scotland encapsulated what this debate is all about when he said: Justice is the cornerstone of our society and if that society is to be a caring society, every member of it, most particularly the poorest, the disadvantaged and the frail must be provided with proper access to justice. Any threat to them should be the cause of our profession's outspoken concern". It is for that reason that the Law Society has no doubt provided the Minister with its own memorandum on this matter. The noble and learned Lord the Lord Chancellor stated: It is in the civil field that the growth of legal aid expenditure is rising particularly fast". He was not referring to Scotland but to England and Wales. As I understand it, that is not the position in Scotland. The figure increased from roughly £15,700,000 to £16,600,000 between 1987–88 and 1991–92. In fact there has been no significant increase in the cost of civil legal aid in Scotland over recent years.

The person who at the moment pays nothing towards his legal aid out of an income of about £160 will now pay a £35 contribution. People may say that that is all right because it may be spread over several weeks or the person can save it up and then pay the full sum. However, £35 is a large sum of money to find out of such an income. Can the Minister forecast how many people will be affected by this measure? On what basis are the predictions made? I know he gave us some figures, but that appeared to me to be an accountancy exercise where one takes a percentage rise and applies that rise over the years. What savings are anticipated to be made to the Legal Aid Fund? More fundamentally, how can the Government, or anyone else, predict human behaviour? How can they say how many more, or fewer, divorces there will be next year?

I ask the Government seriously to consider postponing the implementation of the Advice and Assistance (Financial Conditions) (Scotland) Regulations 1993 and the Civil Legal Aid (Financial Conditions and Contributions) (Scotland) Regulations 1993 so that reasonable consultation can take place with those most closely involved in the administration of justice. Will the Minister agree to have consultations with the parties most closely involved? That is not a clarion call from a lawyer. We have heard from the citizens advice bureaux, Victim Support, the Law Society, the Faculty of Advocates and various local faculties throughout Scotland. I am not sure, because no indication is given, how much discussion took place between the Government and any of those bodies prior to the introduction of the regulations.

Access to the legal process is a right, not a privilege. It is the badge of a civilised society. Any measure which minimises that right of access to the courts is a bad measure.

My information indicates that legal aid in Scotland is closely monitored and controlled. I have been given certain figures as to how much has been recovered in damages and how much has been recovered in expenses. However, I should like the Minister to give the official government figures as to how much has been recovered under the legal aid system during the last year for which tabulated figures are available in respect of damages and of expenses and the net figure as between the cost of legal aid in Scotland and the amount recovered in expenses in the courts.

Why is it that the litigant is being penalised because of the cost of what many of us regard as an inefficient system? Why is the finger not being pointed at the courts? Why are the courts not being placed under severe pressure to make themselves more efficient and to cut down costs to the country and the legal aid system? Do the Government have any plans for an overall review of the operation of civil legal aid and of means of cutting costs within the court system and making it efficient? Do they have plans to seek the views of those most closely involved?

An even more pertinent point is that the biggest hood or criminals in any part of Scotland who commits the most heinous crime can walk straight into the legal aid system and have a senior counsel, a junior counsel and a solicitor, all on legal aid, with no questions asked. The woman who wants to protect herself from a bullying husband or the worker who has an accident in the course of his employment has to grovel for legal aid under this scheme. Why are those two schemes so diametrically opposed?

The last available figures for the legal aid scheme in Scotland show that 60 per cent. of the money spent on legal aid in Scotland was spent within the criminal field. Why is the civil field now being picked upon? What steps do the Government have to sort out the criminal field? We all know from our practice in the courts that many of those who appear in the High Court, in the sheriff court or in Solemn Procedure are very wealthy people with assets behind them. They obtain a legal aid certificate and representation with very little trouble.

If the state is to deprive people of access to the courts certain consequences may follow. First, the citizen may take the law into his own hands, leading to other consequences. Secondly, the citizen may litigate on his own behalf. Thirdly, he may do nothing whatsoever because he cannot afford to exercise his rights. That is justice denied. Can the Minister say what consultation has taken place with the judges in relation to the prospect of people undertaking their own litigation in the courts? What is the prospective cost of such an outcome? It may be an impossible exercise because, as I said earlier, it is impossible to project the course of human behaviour.

I understand that 70 per cent. of cases in the civil legal aid field have involved divorce, separation, custody, access, adoption and interdiction against errant spouses. Of the 23,000 applications, 19,000 involved family law. Those people who previously had the right to apply for legal aid will now be deprived of the right of free representation. The legislation will hit at those who are least able to pay and who are the most vulnerable in society. Children and human relationships are vital to the continuation of a reasonably ordered society.

The ideal would be free access to the courts at all times. That will not happen. Consultation rather than confrontation should be the key word for the future. I ask the Government to look again at what they propose in these regulations and take them back and consult with those most closely involved.

Lord Mackie of Benshie

My Lords, I have been briefed by a very responsible body—the Law Society of Scotland—which the Minister mentioned. The Minister rightly said that the Government have to watch the taxpayers' money. But it worries me that the figures which I have—from which the Minister said some vital facts may have been omitted or concealed, which is a serious charge—indicate that in Scotland expenditure on legal aid is much more reasonable than in England. I should like the Minister to comment on the figures, which he must have seen in his brief.

I understand that total expenditure in Scotland in the past five years has increased from about £47,000 to £80,000 whereas in England it has more than doubled. In addition, I understand that in respect of the criminal law there has been a large payment from the Lord Chancellor's Department. If that is so, and the increase in expenditure in Scotland is mainly in relation to criminal legal aid and associated advice and assistance, there does not appear to be a case. In relation to criminal legal aid the Minister has not reduced the level of assured income below which a person has to pay or altered the level of contribution. However, in relation to civil legal aid, where the figures from the Law Society suggest that the cost has fallen, the Minister has reduced the level of earned income and increased the proportion to be paid from a quarter to a third.

In the case of a married couple with children of five and 12 on an income of £7,000, the contribution would be £140. That is a lot of money for a man with a wife and two children. In respect of what is a very average income, which is well below the industrial wage in this country, of just £10,000 the figure rises from £277 to £1,139. That is a very severe increase.

It appears to me that the Minister may simply be following the policy based on expenditure in England whereas in Scotland the cost appears to be contained. I understand too that the criteria laid down for legal aid are strictly applied. It is an attempt to save money by which the status quo is the least that should have been achieved.

I ask the Minister to explain this. If the figures cited are close, his case for savage increases, or savage decreases—call it what one will—appears to be poor. Perhaps he will comment on the figures and state where they omit or conceal facts that are known.

Baroness Carney of Lour

I listened carefully to what has been said in the debate. Following what the noble Lord, Lord Mackie of Benshie, said, is the basis for the cost figures in England the same, or is it different? Are those correct comparisons? If so, will the noble and learned Lord explain the difference? That is important.

I too have been briefed by the Law Society. I read the comments of the Law Society of Scotland with great interest. The society states: Whilst it is acknowledged that in the period from April to December 1992 expenditure on Civil Legal Aid had increased from the 1991–92 total of £16.5m to £19.3m in December 1992, the number of cases paid had increased over the period from 20,324 to 22,184". That is an indication that the number of civil cases has increased by over 9 per cent. and the cost by nearly 17 per cent. Why is that? What is the reason? Is there any explanation for those increases in cost being considerably greater than the increase in the number of cases?

My noble and learned friend said that of the 300,000 cases in 1992–93, 2 percent. to 3 per cent. will not be eligible. Will he indicate who the 2 per cent. to 3 per cent. will be? That is the nub of the matter. The noble Lord, Lord Macaulay, stated that there were many good factors in the order but said that he would only talk about the bad aspects. I was sorry to hear that because the public like to know when parties agree on matters. If the Minister will indicate who the 2 per cent. to 3 per cent. are, it will help us to understand the problem.

7.45 p.m.

Lord Fraser of Carmyllie

Perhaps I may respond to a number of points raised in the short debate. When we originally put out our regulations, the Law Society of Scotland produced a leaflet. It was sent to your Lordships. In that leaflet, it identified nine or 10 cases which indicated that individuals would be unacceptably affected by the changes that we proposed to introduce. As noble Lords are aware, subsequent to that first set of proposals we significantly altered the proposals to the effect that a contributory band was reinstated with regard to legal advice and assistance. We made our position generally clearer.

As I understand it, the Law Society of Scotland now accepts that all those individual examples that it then used would no longer be a problem because of the changes that we have subsequently introduced with the latest proposals before your Lordships today. My point is this. Whatever figure one chooses, if we increased the figure significantly, people would still say, "What about those with £20,000 income with two or three children? They will find it extremely difficult. They would always find it difficult to pay any contribution for legal aid or legal advice and assistance". It will always be a matter of judgment. It has always been a matter of judgment ever since the legal aid scheme was first introduced. There has not always been cover for everyone who considers themselves outwith the group of the really wealthy.

The 2 per cent. or 3 per cent. who, we calculate as best we can, would fall out of eligibility, would be among the best off of those whom we are considering. They are the people whose income is now above the level for grants. They are not brought into the level for legal advice and assistance or to civil legal aid. It is not a small group somewhere at the bottom which is worse off.

The fact of the matter is that expenditure has climbed and continues to climb. As I indicated, the expenditure for this year is about £104 million. We already have to budget next year for about £112 million on legal aid. Therefore while there are changes—we calculate that about 7,500 people are taken out of eligibility altogether—those changes bring about a small restriction in growth in legal aid expenditure in Scotland. It is in no sense a cut-back from it. There will be more legal aid paid out this year to more people than ever before.

I do not believe that it is particularly helpful to consider the amount paid out in civil legal aid and advice and assistance this year. There are perfectly sound reasons for believing that, when there is a recession, solicitors and others may put in their bills rather more expeditiously than otherwise in order to improve their cash flow. That is easy enough to understand. However, it is important to understand the figures—I have to express disappointment that they have not been more vigorously highlighted—which indicate that the number of grants of legal aid in civil legal aid and advice and assistance has significantly increased in the past year. It is for that reason that it was considered necessary to bring about the changes to contain the growth in expenditure. As I indicated in evidence to a Select Committee in another place, it was for that reason that the changes were brought about, not because of the position south of the Border, although clearly my noble and learned friend the Lord Chancellor has significant costs to contain in that area too.

The noble Lord, Lord Macaulay, quoted from The Scotsman. I indeed made that comment. However, it was in the context of being told that someone giving evidence before the Select Committee had indicated that, if the legal aid budget were to be maintained and a nuclear submarine or some other item of defence had to be cut out, so be it. I consider that a rather "trade union" attitude, the equivalent of saying, "Let's look at our own expenditure, our own interests, and forget the problem of balancing expenditure and income that governments have to do".

I believe that the numbers who will still receive legal aid in Scotland are such that a fair balance has been struck. One point of agreement in your Lordships' House has contributed. It is a concern about criminal legal aid. I readily accept that concern. However, as the noble Lord appreciates, for there to be any significant change in the way that legal aid in criminal matters is granted we should require further primary legislation relating to some aspects of legal aid, although perhaps not all.

From the speech from the Opposition Front Bench, I understand that there is agreement that in one form or another we should restrict criminal legal aid in Scotland. I welcome that. If the noble Lord or others in Scotland have constructive proposals to put forward as to how such restrictions in the growth of criminal legal aid may be achieved, I shall be very pleased to hear from him.

I regret that these modest restrictions seem to have been hyped up as being far more considerable than they are. I believe that they are reasonable enough and I commend them to the House.

Lord Mackie of Benshie

My Lords, before the noble and learned Lord sits down, there is an intriguing point which reflects great credit on his profession in Scotland. I refer again to the comment of the Law Society of Scotland that the average cost per case of legal aid in Scotland is £815 as against nearly £1,600 in England and Wales. That appears to me to be most creditable. It is a bit hard that in Scotland we should lower the base when the efficiency of the Scottish Bar and the Scottish professions seems to be so much higher than in England.

Lord Fraser of Carmyllie

My Lords, this set of regulations is not geared to adjust the fees that lawyers earn in Scotland. In the past three years there has been a 21 per cent. increase in fees paid to lawyers. It is difficult to make comparisons across the Border in relation to legal aid fees and it does not follow that, because they are at a particular level this side of the Border, those fees are appropriate.

On Question, Motion agreed to.