Legal aid firms advised to work smarter or face uncertain future

28 September 2006

Shake-ups to the legal aid system may lead to the closure of 800 firms in England and Wales and reduced access to justice among socially vulnerable groups, according to a study commissioned by The Law Society – but there is still hope for some at the sharp end.

A simple matter of individual firms changing over to ‘lean’ working may allow them to offset the ‘fragile’ profits offered by the legal aid system by reducing their central costs, thus allowing them to continue practising in this area.

This is the approach adopted by London legal aid firm, Hereward & Foster, which has streamlined working and reduced its support costs through digital dictation and outsourcing document transcription to Voicepath.  Its service allows lawyers to send dictations to Voicepath’s network of UK-based typists via a secure internet connection.  This is then typed up and returned to the firm by email.

Firm partner Chris Wilson comments: “In an environment where the pay for legal aid work is a quarter of its commercial equivalent, every penny counts.  We have to be a lean firm to survive.  Being legal aid solicitors means we are not in it for the money, but to help people who would otherwise find it hard to get access to justice.  The current climate, however, can make that difficult.”

Outsourcing support work such as document transcription on a ‘pay as you go’ basis through Voicepath had significant advantages to Hereward & Foster, which could use it to reduce its support bill while improving workflow.  This second point is of growing importance in a future where legal aid firms will need to demonstrate their ability to deal competently with ‘blocks’ of work as opposed to individual cases.

Chris adds: “Not only is outsourcing allowing us to keep our costs under control, it is also solving several problems we had as a firm.  Tight margins and recruitment problems meant a lot of our fee earners had to do their own word processing, which wasn’t a good use of their time.  Now however, we can send this work to Voicepath and get on with doing what really matters to us – helping people in need get access to vital legal services.”

Voicepath general manager, Richard Bate, concludes: “While the inevitable changes to the legal aid system are a cause for concern, we must also accept that there are ways for firms to mitigate the risks associated with them.

“The truth is that high returns in other legal sectors hide the fact that while a great many law firms are profitable, they are not all that efficient.  In areas where profits are low, however, the rule is to be efficient or die.  In this respect there is still a good deal the profession can learn from other areas of business.

“We are delighted to see firms such as Hereward & Foster embracing change so warmly but would strongly advise others to do the same now to secure their futures.”