Regulation is poor value for money, Solicitors tell LSB
Solicitors regard regulation generally as poor value for money, according to a report by the Legal Services Board.
The cost of regulation is also bundled up with other costs of doing business in the mind of the solicitor such as non-legal regulatory requirements and membership of quality assurance schemes such as non-legal regulatory requirements and membership of quality assurance schemes, which also contributes to dissatisfaction with the cost.
However the Legal Services Board said this could be improved by increasing transparency on what regulators spend their money on.
Legal Services Board’s Chairman Sir Michael Pitt said: “The aim is to improve value for money and, wherever possible, drive down the cost of regulation.
“Unnecessary regulation can stifle innovation and the costs are borne by businesses and ultimately by consumers. This is why the LSB has been reviewing the costs associated with regulation to legal services providers.
“This work underpins our regulatory objectives. It has repeatedly been highlighted as a problem for the profession and we now have meaningful evidence on this issue.
“It is clear from the findings of this work that there is general lack of understanding about the true cost of legal services regulation.
“The challenge is to ensure that the regulated community and the public greater clarity of the costs of legal services regulation. Without this, a robust assessment of value for money cannot be mounted.
“As the oversight body for regulation in the legal sector we will continue to scrutinise and encourage openness on all regulatory costs, including our own, in the expectation that general awareness grows over time and that costs will reduce as a consequence.”
All regulators were assessed individually by the board, with some regulators believing they came out of it better than others.
Sheila Kumar, Chief Executive of the Council for Licensed Conveyancers said: “I am very pleased that the LSB’s work on costs of regulation has found that the profession’s views of both the fees and compliance costs of the CLC regime are viewed very favourably to other, comparable regulators. This chimes with the findings of an independent survey to be published in full soon, in which 77% of CLC-regulated lawyers say the CLC provides value for money and three-quarters said it ‘supports innovation and growth’.
“The CLC is far from complacent, and in March this year we were able to announce a 20% cut in regulatory fee rates for firms. This new business model is based on improved staffing arrangements, the benefits of new IT infrastructure, smaller premises and changes to our processes for delivering our regulatory objectives.
“The CLC is focused on the value for money of our work as a specialist regulator of property lawyers, protecting consumers and supporting innovation and growth in the legal services market. This includes using our review of the CLC Handbook to streamline regulation further, based on feedback from the profession and other stakeholders.”