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Legal Services Bill [HL]

I am grateful to the noble Lord. The provisions we have set out in paragraph 43 of Schedule 16 are intended to give the Solicitors Disciplinary Tribunal clear financial independence from the Law Society for the first time by providing that it sets its own budget. I know that this is of great importance to the tribunal. It is envisaged that it will in future be demonstrably independent of the Law Society in administration as well as in functions. The provisions that we have already drafted are intended to achieve that. It is important that we get the drafting of the funding provisions right, and I listened very carefully to what the noble Lord said. Amendment No. 150 reduces the Legal Services Board’s oversight of the budget to a minimal level by removing the need for approval of the budget at all, as long as it is no more than 5 per cent greater than the previous budget. The LSB’s formal approval is required only for increases of above 5 per cent. It is quite possible that the tribunal’s workload may reduce over time, and in those circumstances any increase or, indeed, maintenance of the status quo in the budget might not be appropriate. For that reason, and because the noble Lord’s amendment would in theory allow for automatic increases—if he gets what I mean by that—quite possibly above inflation each year, that is not the approach that we should take. In practice, we would expect the approval of the budget to be a relatively straightforward process. We do not expect it to be particularly onerous for the Legal Services Board or for the tribunal. The amendment also seeks to make it clear that the Law Society collects money to meet the tribunal’s budget from each of its individual members as agent for the SDT, and that it must collect that money only from individual solicitors and only as a separately identified element of the fee of each solicitor’s practising certificate. I am not convinced that that is necessary or appropriate. The Law Society and other approved regulators will collect money from their members for a number of different purposes. It is fair to leave it to the approved regulators to decide how to apportion those sums, and I would resist calls to place a statutory requirement for an approved regulator to set out the exact sums required for each of those elements. That would, in practice, cause the Law Society some real difficulties. It will be normal practice for the Law Society to identify to its members the main elements of the practising certificate fee, but I would be concerned about requiring that in statute. As to how the tribunal will organise its administrative affairs once it has the guaranteed financial independence offered by the new section, it is eminently sensible that the tribunal puts in place effective arrangements for running itself administratively. I consider that the tribunal will have sufficient power within the Bill to do so, so I am not persuaded that we need an explicit reference to setting itself up as a company limited by guarantee. However, I would be prepared to consider that point further in the light of further discussion with the noble Lord, the Law Society and the tribunal. We want to ensure that the tribunal is independent and has the ability to be demonstrably administratively independent from the Law Society. We have sought to achieve that through the wording in the Bill. I hope that I have given some reassurances on that point. On the basis that I will consider the point about the company, I hope that the noble Lord feels able to withdraw his amendment.