Legal Services Board calls for increased transparency in regulatory review

The Council for Licensed Conveyancers and the Solicitors Regulation Authority were amongst the regulators audited by the Legal Services Board, who published their regulatory review this week.

The LSB states both organisations have made progress against last year’s report. However according to the LSB, the CLC is one organisation that needs to improve transparency in its actions.

The report states: “The CLC is committed to being transparent, as evidenced later in this report. Yet its current approach does not seem to be fully aligned with its commitment and good intentions of being a transparent regulator. The CLC needs to consider more carefully how it makes information available so that it can be easily located and accessed by the public. It is also needs to consider making more information available such as Council papers, performance information and its approach to supervision. Transparency is a key regulatory principle and as such we will monitor the CLC’s progress in this area.

It also draws attention to the structural reforms to the regulator’s improvements: “The CLC has demonstrated solid improvement across each of the regulatory standards since our 2012/13 Regulatory Standards report and 2015 Update report. In particular, we are pleased that it has made progress in two key areas: consumer knowledge and its IT architecture. It has begun to develop an understanding of the consumers of its regulated community and apply this learning across its work. We expect it to continue to develop this knowledge either using its own means or through joint projects with the other regulators

According to the LSB, the CLC was broadly better performing than the SRA, scoring “satisfactory” across all categories, with the SRA achieving a lower grade of “Undertaking improvement and work is well underway.”

The SRA’s work in reforming itself was highlighted, however it also came in for criticism over IT issues.

The SRA’s report card stated: “There have also been significant changes to the structure of the SRA’s operational functions, particularly to its supervision team. The SRA has focused on improving its operational performance and this has led to improvements in performance for authorisations and well as some improvements over 2015 in its supervision and enforcement key performance indicators (KPIs). However, a long awaited IT solution for managing the operational functions of the organisation has still not been forthcoming.

“The SRA is in the midst of an extensive programme of reform across all areas of its business. Underpinning this are plans for a fundamental review of its Handbook during 2016 and 2017. We welcome the ambitions of the SRA’s reform programme. It is also important however that the SRA maintains its focus on continuing to improve the performance of its core operational functions.”

Legal Services Board’s Chairman Sir Michael Pitt said: “The LSB’s work to hold the legal services regulators to account for their performance is at the core of our statutory duties. It is key to delivering public confidence in legal services.

“The eight organisations who are the subjects of this review vary widely. No two regulators are alike. The smallest regulates less than a thousand individuals; the largest regulates over a hundred thousand individuals plus thousands of firms.

“We have seen evidence of substantial progress since our last review. The areas where improvements have been made include developing outcomes-focused approaches to regulation, risk assessment processes and risk-based approaches to supervision. But there is much more that needs to be done. This varies depending on the regulator and we will be working with each of them to develop tailored action plans which address their specific areas of improvement.

“Of most significance is the need for improvements to transparency, understanding the impact of rule changes and the need to focus on developing their understanding of consumer needs and use of legal services.”

Responding to the assessment, Paul Philip, SRA Chief Executive, said: “We welcome this year’s assessment which reports significant improvement in many areas and shows we are moving in the right direction. We regulate in the public interest, so I am particularly pleased to see the support for our work with consumers, our Question of Trust campaign on professional standards, and for our Looking to the Future reforms, which will benefit both the public and the profession.

“But we know there is more to do and we are not complacent. For example, we share the LSB frustration at the slow development of appropriate IT systems and continue to work with the Law Society to address this.

“Clearly there are areas where there is more to do, and, as the LSB acknowledges, we already have improvement programmes in place and look forward to continuing our progress at pace. Some recommendations, such as the adoption of the civil standard of proof by the SDT are, however, not in our gift, but we will continue to press for this important reform.

“The LSB also sets out its support for the Government proposals for separation of representation and regulation. I welcome their position and agree that public confidence, the need for further regulatory reform and much greater transparency about funding are fundamental to the discussion.”

Please click here for the response from the CLC

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