The deal is done on criminal legal aid

The government has decided to abandon best value tendering as a means of funding criminal legal aid, but is pressing on with cuts in duty solicitor and advocacy fees.

Lord Bach, the legal aid minister, said that cuts in duty solicitor fees in 'expensive and oversubscribed areas', aimed at achieving savings of £23m, would go ahead as soon as possible next year.

However, he said the cut in advocacy fees could be spread over three years and reduced from 18 to 13.5 per cent, should senior barristers agree to sweeping cuts in fees for very high cost cases.

A spokeswoman for the MoJ said that justice secretary Jack Straw and Lord Bach had 'listened carefully' to representations on BVT made by the Law Society and by legal aid firms.

'They have been persuaded that the scheme currently proposed is unlikely to lead to the efficient, restructured legal services market envisaged by Lord Carter in his 2006 review of legal aid procurement,' she said.

Under BVT, legal aid contracts would have been awarded to the lowest bidder following an online auction.

The LSC originally planned to extend the award of contracts by BVT across England and Wales by January 2011.

Carolyn Regan, chief executive of the LSC, announced in the summer that this would be delayed until 2013, but reaffirmed her determination to press ahead with pilots in Manchester, Bristol and Somerset.

The LSC also planned to extend BVT to civil legal aid and made plans for pilots, but these were dropped in the face of opposition from ministers.

Rodney Warren, director of the CLSA, welcomed the change of heart on BVT as 'the good bit'.

He went on: 'It's the first time I've seen common sense in a decision about legal aid in a long while.

'I'm glad they made the announcement when they did. I feel for all the solicitors and staff in all those areas where businesses were put at risk by BVT.'

Warren said it was interesting that the MoJ was prepared to stage the cut in advocacy fees, but not the cut in the fees paid to duty solicitors.

He added that he strongly opposed any extension of the graduated fee scheme for litigators in VHCC cases.

Announcing a further consultation on cuts to criminal defence advocacy fees, Lord Bach said the ministry had decided to offer an alternative to an immediate cut of 18 per cent.

'The staged reduction is much to be preferred,' he said. 'All solicitor advocates and a large part of the Bar, particularly the youngsters, will never have a very high cost case.'

Lord Bach said that although the earnings of 'very well paid criminal silks' would be reduced, he hoped that the alternative proposal would 'change the feelings of very many members of the Bar, who stand to lose less'.

He went on: 'I'm not saying anyone is going to like it. We're faced with a tough economic situation and we have to make hard choices.

'Everyone is involved in this and will have to make some kind of sacrifice.'

Lord Bach said that cuts to the fees of duty solicitors would go ahead without further consultation.

Half the policed stations involved are in London and most of the others in the bigger cities.

Separate fees paid to solicitors for committal hearings will also be abolished, together with fees for file reviews. The MoJ said it hoped the combined cuts in fees to solicitors would achieve a saving of £23m.

The further consultation on advocates' fees, which began last week, will last for ten weeks, concluding at the end of February when the results of the separate consultation on VHCC fees would also be known.

The Law Society had threatened to take the LSC to judicial review over what it termed the 'impossible' BVT tender process (see solicitorsjournal.com, 17 December 2009).

A group of 124 criminal legal aid firms in the pilot areas, representing around 90 per cent, had also demanded a guarantee that if they took part in BVT and were successful, they should not be forced by TUPE to take on staff from firms which lost contracts.

Bob Heslett, president of the Law Society, praised 'the wisdom and statesman-like approach' of the Ministry of Justice in reaching its decision on BVT, which he said was 'a great Christmas present' for firms in the pilot areas.

'The society has campaigned against this tendering scheme from its infancy, and so we especially welcome this news,' he said.

'We now look forward to working afresh with the LSC and the Ministry of Justice on a new way forward in 2010.'