Editor's blog | Red tape, red herring

Law centres preparing for the cuts in civil legal aid with new models for the delivery of legal services face an obstacle they perhaps did not expect. The Solicitors Regulation Authority, so involved in outcomes-focused regulation for law firms, has been dragging its heels over the creation of a regulatory framework for not-for-profit organisations, including the possibility to charge for some of their services.

The regulator has been prepared to listen and take on board the views of other operators. Just a few weeks ago it proudly announced the first successes in its bureaucracy-busting initiative. Having asked City firms for a list of ten areas where regulation was an obstacle to legal business, SRA chair Charles Plant said he would act on nine of them.

But for law centres, the SRA’s ‘Red Tape Challenge’ has been nothing more than a red herring. Some, which have sought to rely on waivers so they can charge for some of their services, are still waiting to hear back from the SRA. “We are extremely concerned by the Solicitors Regulation Authority’s lack of response to the Law Centres Federation’s request for a waiver to allow law centres to charge for some areas of advice,” the Law Centres Network said in its response to the Legal Services Board’s consultation on the regulation of non-commercial providers in July.

This week it was the turn of the LSB itself to point the finger. As it extended the transition period during which legal NfPs could carry on operating without having to be licensed, it also urged the SRA to give its “urgent attention” to a suitable framework for the regulation of non-commercial bodies.

In its response to the consultation the SRA said it was not confident that models where law centres charge through arm’s length offshoots was a satisfactory solution. While it says it understands the predicament in which law centres find themselves, it seems to see the issues raised in terms of timing, anticipating that “fully regulated” non-commercial bodies should be able to charge for some services.

But timing is an immediate issue for law centres. Already they and their trustees are regulated by the Charity Commission, they have to secure professional indemnity insurance for their solicitors, and individual solicitors are regulated by the SRA. Yet, the SRA appears reluctant to believe they offer adequate guarantees for consumers. ABS could be an option but the process and approach needs to be reviewed to accommodate the position of law centre members as charity trustees.

With the LASPO Act coming into force in four months, law centres need to plan now. So far, they have been given little steer about what to expect. All they need is clearer pointers about the direction in which the SRA is thinking. If the regulator can engage with the City, what is stopping it from being equally engaged with law centres?