Delivering for citizens in Wales
This week (25 April 2022) the Board was delighted to meet a broad range of stakeholders including professionals working in the legal sector who work in Wales as part of our ongoing programme of engagement to build momentum in the delivery of our strategy for the sector – Reshaping legal services to better meet society’s needs. The event provided an opportunity for those working within the sector to discuss the progress which has been made so far against the challenges set out in the strategy for the sector.
Attendees discussed whether access to justice in Wales was improving as we are starting to learn to live with Covid. While there was some optimism, attendees were broadly unsure. Dismantling barriers to a diverse and inclusive profession and the positives and negatives of lawtech innovation for consumers were also discussed. We agreed that there were some positive initiatives in place, but much more needed to be done to tackle unmet legal needs, particularly in rural areas. We will publish a note of the meeting shortly and consider what further steps we can take to ensure regulation plays the fullest role possible in increasing access to legal services. We will also look at how we can support collaboration across the profession in Wales.
Promoting a culture of professionalism
We started our meeting on 26 April 2022 by welcoming Habib Motani as a new member of the Board. He has been appointed for a four-year team. As a qualified solicitor, he bolsters the range of experience and expertise we have on our Board as we continue to deliver our ambition to reshape legal services that better meet the needs of society.
While all eight of the regulatory objectives underpin everything we do, it would be fair to say that at this meeting there was a particular focus on ‘promoting and maintaining adherence to the professional principles’. The professional principles include that lawyers act with integrity, maintain proper standards of work, and act in the best interests of their clients. When lawyers fail to adhere to expected standards, it is vital that regulators act.
As the oversight regulator, we need to be assured that regulators are taking effective disciplinary and enforcement decisions to ensure consumers are protected from harm. Regulators take different approaches to enforcement decisions and have different quality assurance mechanisms to ensure the quality of their decision-making. Some stakeholders have also raised concerns with us about the transparency of some regulators’ processes for complaints handling about regulated individuals, which could indicate systemic issues.
In light of this, the Board agreed on plans for a new project in our 2022/23 business plan and we discussed the scope of this work to identify the principles that underpin effective disciplinary and enforcement decision-making by the regulators. We expect that this will form the basis for a statement of policy setting out our expectations.
We will work closely with regulators to identify good practice and build consensus on principles that should underpin all regulators’ decision-making. We also agreed that there would be merit in carrying out more thematic reviews to take a more in-depth look at some of the regulators to better understand how their processes work in practice and whether they result in effective decision-making.
Having effective disciplinary arrangements across the regulators is central to ensuring the professionalism of the sector and building the trust of consumers and society more broadly.
Ensuring an effective financial sanctions regime in the legal services sector
The Russian invasion of Ukraine has encouraged many of us across the sector to ensure we are doing everything we can to ensure the sector is not profiting from assistance to sanctioned individuals or businesses.
While providing legal services to a sanctioned entity is permitted, a licence is required in advance to receive fees for those services from the Office of Financial Sanctions Implementation (OFSI), a branch of HM Treasury, and any such fees must be reasonable.
We are coordinating work with all regulators, OFSI, OPBAS and the Ministry of Justice to reinforce the financial sanctions regime as it applies to legal services. While there is an obvious focus on sanctions relating to the war in Ukraine, the principles apply to all sanctions imposed by the UK.
The regulated community has an important role to play in ensuring the effectiveness of the regime and we will do all we can to raise awareness and ensure compliance and enforcement.
We are working collaboratively with the regulators to set and agree clear expectations and will follow up to assess progress towards them. In addition, we continue to work with both the Government and the regulators to pursue information sharing and additional powers to secure compliance. In the slightly longer term, we will be applying the learning from this exercise to our broader work planned for this business plan year on the rule of law and what that means for regulation.
Ensuring that adequate financial protection arrangements are in place for consumers
The goal of our initiative focused on ensuring there are adequate financial protection arrangements in place for consumers will be to develop and drive forward policy options supported by evidence encompassing claims data analysis and research. The project will facilitate regulators to strike the correct balance between an appropriate level of financial protection for consumers whilst looking to the future to ensure that the costs to the profession and consumers is both sustainable and affordable in the long term.
An additional purpose of the project will be to enable regulators to use their regulatory levers to address the root causes of risks in the legal sector which may be resulting in high insurance premiums or claims on the compensation fund.
Legal Services Consumer Panel work plan 2022/23
Sarah Chambers, Chair of the Legal Services Consumer Panel, presented the Panel’s work plan for 2022/23, which was endorsed. The Panel has aligned its strategic goals with ours and we look forward to continuing to work together on our shared objectives. We welcomed the planned research by the LSCP including consumers’ differential experiences accessing legal services.
Sector conference: A diverse public deserves a strong, ethical and diverse profession
The Board discussed the emerging plans for a conference for the legal services sector later in the year. We agreed it would be diversity themed and the topic would be ‘A diverse public deserves a strong, ethical and diverse profession’. The conference will be open to everyone with a role to play in delivering our strategy for the sector, including lawyers and legal professionals, academics, charities, third-sector organisations, consumer groups, politicians, and the judiciary.
This event will give us all an opportunity to reflect on the areas where progress is being made on the challenges facing the legal services sector and agree how we will work together to address areas where progress is slow. We will work collaboratively with the Legal Services Consumer Panel and others to produce the event.
Invitations will be sent shortly.
Vulnerability and legal services
At the end of our meeting, we welcomed Community Research who provided a presentation on the topic of consumer vulnerability. Community Research provide our public panel – a market research tool that we established with the Consumer Panel to enable us and the regulators to explore and better understand the views, needs, and perceptions of people who need and use legal services.
They gave us an early preview of research into exploring the vulnerabilities that consumers face when they need and use legal services.
We discussed how all consumers benefit if legal services are designed to meet the needs of the most vulnerable in society. We analysed how expectation management provided by legal professionals is of key importance to decreasing anxiety for consumers. The research will be published later in the spring.
Our next Board Meeting will be held on 7 June 2022 in Leeds. It will be preceded by a stakeholder breakfast event focused on Yorkshire. We look forward to meeting with people in the legal services sector from across the region.