Legal aid lawyers pay the price of LSC's mismanagement

9 March 2010

Today the Law Society has been notified by the Legal Services Commission (LSC ) that, because of the cash position in which the LSC finds itself, the Commission will be delaying payments to solicitors due in March until the start of the next financial year. This is because of obligations the LSC says are demanded of it by the Ministry of Justice in managing its cash budget.

Commenting on the decision by the LSC to delay payments this month, Mark Stobbs, Law Society Director of Policy, says:

"This appears to be a breach of the Prompt Payment Code* - to which the MoJ is a signatory . The Society does not see any good reason why the profession should bear the burden of the LSC's poor financial management. It is bad enough that firms are not entitled to be paid for the work they do until a case has concluded, often months or even years later. To delay payments even further after that, for work that firms have done and are entitled to be paid for, solely for reasons of Government cashflow, is at odds with a purported Government policy of supporting small businesses and is completely unacceptable."

The Law Society has written to the main clearing banks to alert them to the problems that their legal aid customers may face as a result of this decision. However, the Society does not see why banks and firms should have to bear this burden. The Society will be writing urgently to the MOJ to lobby them to return to the payment schedule it promised.

Mr Stobbs says: "It is not acceptable for Government bodies to treat its suppliers in this arbitrary way and with less than a month's notice. I very much hope that the MOJ will agree and be able to insist that the LSC returns to the payment schedule that it had promised and should honour."