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Consultation on Central Funds


A consultation run by the Ministry of Justice took place between 6 November and 29 January 09 on the Award of Costs from Central Funds in Criminal Cases.

A consultation run by the Ministry of Justice took place between 6 November and 29 January 09 on the Award of Costs from Central Funds in Criminal Cases.

In the consultation it stated that 3 options were being considered in order to reform Central Funds payments and reduce costs in this area. The 3 options were:-

Option 1 - No change to the present system.

It was stated however that this option had been included primarily for ‘comparative purposes'.

Option 2 - Restrict access to Central Funds.

This would mean that private paying individuals who initially failed to apply for legal aid in Crown Court cases would no longer be eligible for Central Funds payments if they were acquitted.

It would also mean that individuals who failed the Interest of Justice test in Magistrates Court cases, and in appeals to the Crown Court but obtained legal representation would no longer be able to claim their costs back from Central Funds.

Option 3 - Cap Central funds payments in all cases for acquitted defendants to the relevant legal aid rates.

This would mean that payments made in both Magistrates Court cases and Crown Court cases for private paying clients would be restricted to legal aid rates.

If this option were to be implemented defendants would be liable for any difference between the refund of costs at legal aid rates and their actual expenditure on their case at the private rate.

Options 2 and 3 are not mutually exclusive, so both could be implemented.

The Law Society put together a response to the consultation following an online survey conducted between 9-15 January 2009 in order to ascertain the likely impact the above proposals would have on solicitors' businesses. 201 firms responded and 83% of those stated that less than 25% of their work was privately funded. Many commented that as the margins on legal aid cases are so tight central funds cases made them sustainable. 20% of those who responded said that their business would no longer be sustainable if the proposed changes were brought in. A further 41% said they would be able to continue but would have to restructure their business.

As well as the financial impact the proposals would have on firms if implemented respondents to the survey also commented on the impact they could potentially have on clients. They felt that some people may plead guilty early on even if they had a good defence because many defendants who are not eligible for legal aid struggle to pay their costs but do so if there is a reasonable chance of acquittal and re-imbursement. Another concern was that defendants may chose to have no legal representation at all which would tilt the balance of justice as they would be appearing against professional prosecutors.

The response to the consultation has yet to be published. Once it has the relevant policy or policies will be put into place and will then be reviewed within 2 years of implementation. As stated in a previous article the Ministry of Justice were due to analyse savings made from moving the determination of Central Funds bills from Justice's Clerks to the National Taxing Team over the consultation period. It will be interesting to see how much impact this has had and to then see which policies are implemented following the responses received.

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