Guideline hourly rates: 'modest' increases proposed 

The Civil Justice Council (CJC) has published its long-awaited report on guideline hourly rates (GHR), setting out recommendations for a “simplified scheme” with “modest” increases proposed. 

It also recommended changes to areas London 1 and London 2; and that national band 3 should disappear and be merged into band 2.

GHRs have remained statics for more than a decade and judges have made clear that in their present form, they are antiquated and not fit for purpose.

Responding to the CJC report Sean Linley, a costs draftsman at Carter Burnett, said the consultation paper will make “many welcome observations”.

The consultation, opened on 8 January, will close on 31 March 2021.

Linley commented: “The data collected so far led to conclusions of rate increases of varying degrees for all grades of fee-earners which will be welcomed by many. 

“There are also recommendations for rates to be updated annually in line with an appropriate SPI index with a possible more significant review in around three years’ time. 

“The working group has looked at re-banding geographical areas to remove anomalies and make it more consistent, including redefining London 1 for very heavy commercial and corporate work.”

The consultation will also seek to find agreement on banding by region and county, so that no location is left out (some areas are omitted in the current list).

“Another key consideration”, added Linley, “is the fact that the working group has recommended certification as to the location of the fee earners carrying out the work. 

“Practically, this means a firm based in London will have to do the work in London if they want London rates. 

“It goes without saying that the best way to be heard is to respond to the consultation so that as much evidence is available as possible when final conclusions are reached. 

“Practitioners should not lose sight, however, that for whatever the final outcome the GHRs are and always will be no more than a guide.” 

The Law Society’s head of justice Richard Miller commented: “Guideline hourly rates for solicitors have not been changed in over ten years and were long overdue a review. 

“Revised rates would give both solicitors and their clients greater clarity about costs and we look forward to responding to the consultation points raised in the report.”

Association of Costs Lawyers chair Claire Green said it is "unarguable that the GHRs need to be increased after a decade-long freeze".

But she acknowledged that deciding on new rates is no easy task. She noted: "The working group describes its proposed increases as ‘modest’ and if nothing else that will hopefully aid their approval should they be the final figures recommended to the Master of the Rolls."

Green added: "The working group notes that, back in 2015, the then Master of the Rolls, Lord Dyson, accepted the recommendation that suitably qualified costs lawyers should be eligible for grades B and C. Implementation of this, and recognition of the value of our work, is now long overdue.

“The group clearly sees its work as an interim measure ahead of a fundamental review of the GHR in the context of the profession’s changing working practices.

"To some extent, the GHRs do reflect a time when legal life was very different to today’s technology enabled practice."

But she said that meanwhile, it is important for costs lawyers and solicitors to have their say on the report.

Miller added: “It will be important to consider these changes in the context of other civil justice reforms including the Ministry of Justice’s work on fixed recoverable costs and the wider HMCTS reform programme.”