The value of a family business or business interest is treated as an asset and therefore part of the matrimonial pot to be distributed when it comes to negotiating a financial settlement on divorce or...
Government proposes to axe legal aid for private family law
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Nov 15, 2010, 11:25 AM
Article ID :92811
By Hugh Logue, Newswatch Editor
Justice Secretary Kenneth Clarke today unveiled the Ministry of Justice's programme to reform legal aid, including cutting funding for family private law cases such as divorce and child contact proceedings.
Of the proposed £350 million reduction to the £2.1 billion legal aid budget, civil and family law could suffer the most severe cuts. In family law, funding will be limited to "cases which are judged to have sufficient priority to justify the use of public funds".
However, funding for cases where domestic violence is involved will continue. Funding will also continue to be provided for mediation as an alternative to family disputes going to court.
The Justice Secretary also announced today that the fees paid to lawyers in civil and family cases will be reduced by 10% across the board. Similar levels of reductions will be made to experts' fees.
The programme for reform is contained in two consultations, published today, one on legal aid and the other on civil litigation costs in England and Wales. The consultation on legal aid reform aims to significantly reduce the legal aid budget, while the civil litigation costs paper contains proposals to reduce the costs payable by people who have been sued in "no win no fee" cases, alongside other proposals to make civil costs more proportionate for defendants.
The proposals include assessing all civil legal aid applicants on their available capital, including those on benefits, with greater account being taken of equity in people's homes. A minimum £100 contribution to their legal costs will be introduced for all successful applicants with £1,000 or more disposable capital, and higher contributions will be expected from those who currently contribute to their legal fees.
As part of the consultation, the MoJ is seeking suggestions for alternative sources of funding for the legal aid fund, to help supplement existing funding arrangements. These include making use of the higher rates of interest generated by money invested in a new pooled account where solicitors would hold their clients' money, and recovering a proportion of legal aid funds in cases where a successful claim for damages has been made.
In his statement to the Commons this afternoon, Kenneth Clarke said: "I strongly believe that access to justice is the hallmark of a civilised society. But at more than £2 billion each year, we currently have one of the most expensive legal aid systems in the world. This cannot continue.
"Since the scheme was established in 1949 its scope has been widened far beyond what was originally intended. There has never been a substantive review of the entire system to ensure it is sustainable, proportionate and affordable," Mr Clarke said.
The Bar Council has been preparing for some time for the reforms and has set up a number of working groups to examine the MoJ's proposals, drawing on the expertise of several specialist Bar associations.
Nicholas Green QC, the Chairman of the Bar, said that reform is necessary but the impact of the proposals on the most vulnerable must be considered carefully.
"Today's announcement of the Government's consultation on reforming legal aid is a necessary and timely step. There has been no shortage of reviews of legal aid in the past few years. This latest consultation, coming against the background of massive public expenditure cuts across almost every area of government activity, provides an opportunity for the Bar to ensure that cuts in legal aid expenditure do not result in a denial of justice."
Commenting on the civil litigation consultation, Michael Todd QC, Vice Chairman-Elect of the Bar, who led the Bar's earlier response to Lord Justice Jackson's review on Civil Litigation Costs, said: "The Bar Council wants a civil justice system that works effectively and in the interests of all of those with a stake in it. There is a great deal that we shall need to reflect on in the Government's civil litigation consultation. The Bar Council recommended that the funding aspects of the costs of civil litigation should be the subject of a separate consultation and we shall examine the Ministry's consultation, which draws on a number of our earlier contributions, in that light.
"As legal aid is to be reduced by hundreds of millions of pounds, it is vital to ensure that alternative means of accessing the justice system available, subject to appropriate safeguards and measures to prevent abuse. We look forward to responding to the consultation fully in due course."
Law Society President Linda Lee said the Government needs to find new ways of funding legal aid, including an increased tax on alcohol sales.
"We suggest introducing a ‘polluter pays' system so that the alcohol industry meets the costs of legal aid made necessary by their activities. Alcohol abuse results in increased criminal behaviour, increased court costs and puts pressure on the legal system."
She added: "The Society believes the Government should not take any further steps to reduce financial eligibility for legal aid, nor to remove legal aid from categories of cases. Legal aid clients are some of the most vulnerable in society and good legal representation where required is essential if they are to obtain justice."