HL Deb 04 November 1996 vol 575 cc524-6

2.45 p.m.

Lord Boyd-Carpenter asked Her Majesty's Government:

What was the cost to public funds of legal aid in the last year, and what is the estimated cost in the current year.

The Lord Chancellor (Lord Mackay of Clashfern)

My Lords, net expenditure on legal aid in 1995–96 was £1.391 billion. The provision for the current financial year is £1.477 billion, though on present trends it would appear as though actual expenditure will be slightly higher than that.

Lord Boyd-Carpenter

My Lords, is my noble and learned friend happy with that further increase in expenditure in this area? Is he aware that many of us feel that public expenditure of this kind ought not to be increased and ought to be controlled?

The Lord Chancellor

My Lords, I have intimated proposals for providing machinery for controlling the total size of the legal aid budget. The details are set out in the White Paper. In the meantime, quite a lot is being done under the present system to try to control what is being paid out. For example, I am hoping to introduce a system of graduated fees for advocacy in the Crown Court at the beginning of 1997 which will cover cases lasting up to and including 10 days. It is also proposed to introduce a system of standard fees for civil legal aid work, including matrimonial cases. That will provide greater control over expenditure and incorporate early and certain payment for quick and efficient work.

Lord Dean of Beswick

My Lords, is the noble and learned Lord the Lord Chancellor aware that such changes as have been made are welcome? However, does he recall that some months ago I raised the question of a German national, living in Italy, who sued a Japanese company through the courts of this country and received substantial legal aid to do so, to the surprise of most Members of your Lordships' House and the public outside? Can the noble and learned Lord tell us whether measures have been brought to bear, as he indicated they would, to prevent what most of us consider to be an abuse of the system? If not, it is about time they were.

The Lord Chancellor

My Lords, I indicated before and I indicate again that I have proposals for overall control of the legal aid budget which will deal with the kind of case referred to by the noble Lord, Lord Dean, and give priority to cases within the overall money available. I believe that the specific case mentioned by the noble Lord was an infringement in this country of a United Kingdom patent. However, my general proposals will have the effect of putting priority as between cases of that kind and other cases which your Lordships may think more deserving and allocating funds accordingly.

Baroness Gardner of Parkes

My Lords, will my noble and learned friend comment on the pressure that exists to provide legal aid in cases in tribunals of all sorts? I declare an interest as a person who sits as a member of an industrial tribunal. Can he tell me whether that will add greatly to the cost? Also, does he hold the view, as I do, that it will be damaging to the informality of the tribunal proceedings to introduce legal aid into that process?

The Lord Chancellor

My Lords, in the present state of controls over legal aid there is no question of extending it further to tribunals. If the legal aid budget was fully controlled, occasions might arise when it would be appropriate to fund certain types of specific cases. However, that would be within an overall priority for legal aid and with a controlled budget. There is no question whatever of that happening under the present system so far as this Government are concerned.

Lord Irvine of Lairg

My Lords, is the noble and learned Lord aware that Mr. Orchard, the Chief Executive of the Legal Aid Board, has recently written that the merits test does not represent a substantial barrier to trivial or frivolous litigation and that he has also written that increasingly the board is finding that it is not in possession of the full facts of cases in legal aid applications? Does he have any plans to deal with this?

The Lord Chancellor

My Lords, the merits test is laid down in primary legislation. Only primary legislation can change that. I proposed in the White Paper that we should change that by primary legislation when parliamentary time is available. So far as concerns ascertaining the facts, the Legal Aid Board is learning more and more how to try to extract from applicants the relevant facts. The Legal Aid Board is not the ultimate judge of the case. It looks to see whether there is a prima facie case within the terms of the existing merits test. But the Legal Aid Board is now finding it rather less certain to rely on the advice it gets from the applicants' lawyers than once it did. This matter requires further action on the part of the Legal Aid Board, and that it is pursuing.

Lord Meston

My Lords, can the noble and learned Lord confirm that, contrary to the impression sometimes given, the vast majority of legal aid is not squandered but is properly used on deserving cases which are conscientiously assessed both as to merits and to means? Can he also indicate whether the figures he has given allow for the recovery of the costs of legal aid through costs orders, the statutory legal aid charge and from VAT?

The Lord Chancellor

My Lords, there is no question of recovery of VAT except under the two heads which the noble Lord mentioned. The figures I have given are figures of net expenditure. It is difficult to say where the balance lies between genuine claims and claims that are less than genuine. But my understanding of the experience of the Legal Aid Board is as I said in answer to the question of the noble Lord, Lord Irvine of Lairg. The Legal Aid Board is finding that facts are alleged to it in applications which, once the case starts, often turn out to be not quite accurate. The Legal Aid Board is examining the situation carefully to see whether it can prevent this happening in the future.

Lord Cledwyn of Penrhos

My Lords, against that background, can the noble and learned Lord tell the House how many applications for legal aid have been rejected by the board over the past two years or so?

The Lord Chancellor

My Lords, I do not have that figure with me. I am happy to write to the noble Lord with an answer to that question. I take it that he means initially refused by the Legal Aid Board, because sometimes the decisions of the Legal Aid Board are altered on appeal by area committees and sometimes following judicial review.

Lord Taylor of Blackburn

My Lords, I have no pecuniary interest in the matter and I am not a solicitor by any means. However, as an ordinary man in the street, perhaps I may ask the noble and learned Lord whether he is really happy with the situation. Many of us who see cases in one capacity or another are most dissatisfied with the way in which the Legal Aid Board presents itself to people. It seems most unfair in many cases.

The Lord Chancellor

My Lords, it goes without saying that I am not happy with the present position, which is why I have made proposals in the White Paper to change it. On the other hand, the Legal Aid Board is doing its best within the constraints of the present scheme. It is trying to improve its systems all the time. There is no complacency in this operation. I do not think the Legal Aid Board is complacent, as the quotations from the chief executive given by the noble Lord, Lord Irvine, show.