Legal Aid Contracting

Equality, Procurement and Competition

FOREWORD

We published research on legal aid contracting and international comparisons in July this year, to help members and others interested to find out more about the likely impact of contracting proposals. This, our second research paper, looks to build on that understanding by outlining the legal and economic context in which contracting for criminal legal aid might operate.

This research paper does not outline any policy view around legal aid contracting. The aim is simply to indicate some of the issues that may arise should contracting be adopted. A Scottish Government consultation paper on criminal legal aid contracting is expected shortly and we will be surveying members for their views as part of our engagement on this issue.

In the meantime, we are grateful for the feedback that we have already received on this work and this issue and welcome further views.

Andrew Alexander

Head of Access to Justice

December 2013

TABLE OF CONTENTS

FOREWORD ...... 2

CHAPTER ONE – CONTRACTING AND EQUALITY ...... 7

THE EQUALITY ACT 2010 ...... 8

GENERAL EQUALITY DUTY ...... 8

BROWN PRINCIPLES ...... 9

SPECIFIC DUTIES ...... 10

SLAB – EQUALITY MAINSTREAMING ...... 11

SPECIFIC DUTY – PUBLIC PROCUREMENT ...... 12

SERVICE PROVIDERS ...... 14

EMPLOYERS ...... 16

STANDARDS OF CONDUCT ...... 17

DEMOGRAPHY...... 18

CRIMINAL LEGAL AID CLIENTS ...... 18

CRIMINAL LEGAL AID PROVIDERS ...... 19

REMEDIES ...... 22

CONCLUSIONS ...... 26

DEMONSTRATING COMMITMENT TO EQUALITY ...... 26

GUIDANCE AROUND EQUALITY ...... 26

EQUALITY CHALLENGES ...... 26

ANNEX 1A – FIRM SIZE BY NUMBER OF REGISTERED CRIMINAL PRACTITIONERS ...... 27

ANNEX 1B – AGE AND GENDER OF CRIMINAL LEGAL AID PRACTIONERS ...... 28

CHAPTER TWO – CONTRACTING AND PROCUREMENT ...... 31

PUBLIC CONTRACTS (SCOTLAND) REGULATIONS 2012 ...... 33

CONTRACTING AUTHORITY ...... 34

CONTRACT VALUE ...... 35

GENERAL OR SPECIAL EXEMPTION ...... 38

PART A AND PART B SERVICES ...... 38

SELECTION AND AWARD CRITERIA ...... 38

PROCUREMENT PROCESS FOR PART A SERVICES ...... 40

TFEU PRINCIPLES ...... 41

REMEDIES ...... 42

PROCUREMENT REFORM ...... 42

EU PROCUREMENT DIRECTIVE ...... 43

PROCUREMENT REFORM (SCOTLAND) BILL ...... 43

CASELAW ...... 44

TENDER CRITERIA IN ENGLAND AND WALES ...... 44

TFEU PRINCIPLES ...... 53

DEXTER MONTAGUE ...... 53

HASTINGS & CO ...... 56

AZAM & CO ...... 58

JR SOLICITORS ...... 60

CONCLUSIONS ...... 61

CHANGING PROCUREMENT LANDSCAPE ...... 61

CONTRACT CRITERIA ...... 62

MISTAKE ...... 62

CHAPTER THREE – CONTRACTING, MARKETS AND COMPETITION ...... 64

PERFECT COMPETITION ...... 65

MONOPSONY ...... 65

COMPETITIVE NEUTRALITY ...... 67

SUICIDE BIDDING ...... 68

COMPETITION LAW ...... 69

CONCLUSIONS ...... 70

MONOPSONY NOT INTRINSIC BARRIER TO COMPETITION ...... 71

RISK OF SUICIDE BIDDING ...... 71

COMPETITIVE NEUTRALITY ...... 71

REFERENCES ...... 73

BIBLIOGRAPHY ...... 73

CITATIONS ...... 75

LEGISLATION ...... 75

CASES ...... 75

Public sector equality duty

• Eliminating discrimination • Advancing equality of opportunity • Fostering good relations • Due regard is integral to functions of public bodies

Specific duty - procurement

• Ensuring relevance and proportionality • Ensuring effective SME participation

Service providers, employers and accessible services

• Prohibition on discrimination, harassment, victimisation • Duty to make reasonable adjustments

Law Society Standards of Conduct

• Prohibitions on discrimination in line with Equality Act 2010 • Specific responsibilities for managers and supervisors around training and accessibility

Demography of criminal legal aid

• Many clients possessing protected characteristics as well as other characteristics that cause vulnerability • Age distribution differs from that of profession overall

CHAPTER ONE – CONTRACTING AND EQUALITY

Legal aid is an important public service: in a recent survey by Ipsos MORI for the Law Society of Scotland (LSS), 81% of the public agreed with the statement that ‘Legal aid is a price worth paying to ensure we have a fair society, regardless of the cost’. 1 2 Legal aid provides support to some of the most vulnerable in society, often directly assisting people in Scotland in tackling discrimination in education, employment, housing, immigration, mental health and a range of other areas. Providing equality before the law is a key way in discrimination can be eliminated and equality of opportunity promoted for groups with protected characteristics, whether gender, race, disability or others.

As service providers, legal firms already hold responsibilities under the Equality Act 2010, and the proposals for criminal legal aid contracting envisage a wider role for equality in the provision of criminal legal aid services. The Scottish Government’s (SG) White Paper, A Sustainable Future for Legal Aid, 3 states that “contracts could be used to clearly set out the requirements for specific types of work, for example by ensuring public sector service level requirements are met (including public sector equality duties)”. The Scottish Legal Aid Board’s (SLAB) paper, The Context for Contracting, 4 suggests some contract criteria that might be deployed, for instance, around a commitment to equalities, accessibility of premises, or reporting on the equality characteristics of clients.

This chapter will outline the current framework under the Equality Act 2010, the general duty and the specific duties required from public bodies. the responsibilities for legal firms under this legislation and some of the work done by the LSS in its equality and diversity work. The requirements on SG and the SLAB, as with public bodies in general, will also be noted. The ways in which public sector equality duties (PSEDs) could be met through the development of contracting will be outlined, including some of the steps that firms may want to consider. The possible implementation of equality factors as part of the selection and award criteria should also be viewed within the scope of the public procurement framework, including the sustainable procurement duty and the encouragement of community benefit clauses for contracts above a £4m threshold in the Procurement Reform (Scotland) Bill, 5 as well as the Treaty on the Functioning of the European Union (TFEU) 6

1 Public Fear Legal Aid Cuts Will Hit Society's Poorest, Law Society of Scotland, press release, 28 November 2013 2 The survey also found 83% agreeing with the statement that ‘if the Government makes cuts to legal aid, it will be the poorest members of society that will be most affected’ 3 A Sustainable Future for Legal Aid, Scottish Government, September 2011 4 The Context for Contracting, Scottish Legal Aid Board, July 2013 (http://www.slab.org.uk/providers/reforms/criminal/Contracting/ContextForContracting.html), last accessed 30 November 2013 5 As introduced to the Scottish Parliament on 3 October 2013 (http://www.scottish.parliament.uk/S4_Bills/Procurement%20Reform/b38s4-introd.pdf), last accessed 30 November 2013

principles of non-discrimination, equal treatment and transparency: these are considered in further detail in the next chapter.

The impact of contracting on the profession and on legal aid clients from an equality perspective will be examined and the demographics of criminal legal aid providers and client groups will be analysed. These factors will need to be considered by SG and by the SLAB in the development of contracting proposals and the experience of contracting in England and Wales, subject to the same legislative framework, will be contrasted. As seen in the previous research paper, the impact of contracting and in particular, the consolidation of work into larger business units as part of proposals for Best Value Tendering (BVT) in England and Wales, was highlighted by the Constitutional Affairs Select Committee as a possible contravention of the Race Relations Act 1976. 7 8 Last, how any equality factors overlooked through the policy development process could be redressed will be outlined.

THE EQUALITY ACT 2010

GENERAL EQUALITY DUTY

Consolidating previous anti-discrimination legislation and also implementing the EU Directives on equal treatment, the Equality Act 2010 sets protected characteristics against which discrimination is unlawful. Section 4 of the Act details these protected characteristics:

Age

Disability

Gender reassignment

Marriage and civil partnership

Pregnancy and maternity

Race

Religion or belief

Sex

Sexual orientation

6 Consolidated Versions of the Treaty on European Union and the Treaty on the Functioning of the European Union (2012/C 326/01) 7 Since consolidated into the Equality Act 2010 8 Legal Aid Contracting, Law Society of Scotland, July 2013

A general equality duty applies to public bodies in Scotland in relation to these protected characteristics under section 149(1) of the Act:

“A public authority must, in the exercise of its functions, have due regard to the need to

(a) eliminate discrimination, harassment, victimisation and any other conduct that is prohibited by or under this Act;

(b) advance equality of opportunity between persons who share a relevant protected characteristic and persons who do not share it;

(c) foster good relations between persons who share a relevant protected characteristic and persons who do not share it.”

BROWN PRINCIPLES

In the exercise of its functions, the need to have ‘due regard’ does not require a public body to ensure that it complies the three parts of the general duty; rather, that the equality impacts of any action are considered appropriately. The broad principles were established in a case about post office closures, disability and accessibility, R (Brown) v. Secretary of State for Work and Pensions. 9 10 Aikens LJ outlined six principles:

“First, those in the public authority who have to take decisions that do or might affect disabled people must be made aware of their duty to have ‘due regard’ to the identified goals”;

“Secondly, the ‘due regard’ duty must be fulfilled before and at the time that a particular policy that will or might affect disabled people is being considered by the public authority in question”;

“Thirdly, the duty must be exercised in substance, with rigour and with an open mind. The duty has to be integrated within the discharge of the public functions of the authority. It is not a question of ‘ticking boxes’”;

“Fourthly, the duty imposed on public authorities… is a non–delegable duty. The duty will always remain on the public authority charged with it”;

“Fifthly, (and obviously), the duty is a continuing one”;

9 [2008] EWHC 3158 (Admin) 10 Though the ‘Brown principles’ pre-dated the Equality Act 2010, these have been applied by courts since, for instance, R (Greenwich Community Law Centre) v. Greenwich London Borough Council [2012] EWCA Civ 496

“Sixthly, it is good practice for those exercising public functions in public authorities to keep an adequate record showing that they had actually considered their disability equality duties and pondered relevant questions. Proper record - keeping encourages transparency and will discipline those carrying out the relevant function to undertake their disability equality duties conscientiously.”

The duty to have ‘due regard’ must be considered “with rigour and an open mind”, and integrated with the overall discharge of a public authority’s duty; there is no duty to take particular steps or achieve particular outcomes. 11 Administrative law does not challenge “multi-faceted budgetary decisions… [that] involve difficult policy choices… [for which] the democratic representatives of the local people has the primary function of exercising judgment and of making choice.” 12 For proposals for legal aid contracting, it is important that equality considerations are integral to any proposals; it does not require that discrimination, harassment or victimisation are prevented, or equality of opportunity or the fostering of good relations are advanced; it is critical, however, that these issues are considered.

SPECIFIC DUTIES

There are also specific duties on listed public sector bodies, detailed in the Equality Act 2010 (Specific Duties) (Scotland) Regulations 2012. 13 In the Schedule to these Regulations, both Scottish Ministers 14 and also the SLAB are listed. The specific duties include:

To report at least every two years on “the progress it has made to make the equality duty integral to the exercise of its functions so as to better perform that duty” 15 (or ‘mainstreaming’ of the general duty in the 2010 Act);

To publish a set of equality outcomes at least every four years and to report on these outcomes at least every two years; 16

To assess a new or revised policy or process against the general equality duty, to publish the results and to review that policy or process; 17

To gather information on employees and on recruitment, development and retention of individuals to better perform the equality duty; 18 and if having 150 employees or more, to publish information on the gender pay gap and equal pay and

11 See also R (Williams) v Surrey County Council [2012] EWHC 867 (QB) 12 R (Capenhurst) v Leicester City Council [2004] EWHC 2124 (Admin) 13 SSI 2012/162 14 The legal entity for the activities of the Scottish Government 15 Regulation 3, ibid 16 Regulation 4, ibid 17 Regulation 5, ibid 18 Regulation 6, ibid

occupational segregation (gender, disabled or not, minority ethnic group or not) information. 19

SLAB – EQUALITY MAINSTREAMING

The SLAB has published a report, Equality Mainstreaming and Equality Outcomes, which gives some practical examples of how, as an organisation, it is addressing equality issues. 20 These include conducting and publishing equality impact assessments on policies, services and procedures; ensuring that information on legal aid is accessible to the public, including publications available in ten languages, other languages available on request and in Braille, large print or audio recording; conducting specific equality research and also capturing information on protected characteristics in other survey work; and promoting equality in the recruitment and training of staff.

Part V provision of legal services, through the Public Defence Solicitors’ Office (PDSO) and the Civil Legal Assistance Office (CLAO) is a function of the SLAB, as any other, and is subject to the general duty. The report outlines some of the ways that the PDSO has included equality in its operations:

“The PDSO… operate with an ethos that is inclusive and enabling. Here are a few examples to illustrate this. The letter of engagement received by clients from PDSO is clear in explaining that accessible meeting points can be arranged if necessary. PDSO also operate a case management system with equalities embedded as a recorded issue to provide detailed reports and a tailored service to clients of the service. All PDSO information leaflets are available in a variety of accessible formats. In the past the PDSO have taken steps to address the challenges presented by a changing society by employing a paralegal who speaks Polish to represent and help those in trouble who may not be clear about the Scottish criminal system. As part of their Continuing Professional Development the majority of the PDSO solicitors attended a one day event on representing and advising clients in police custody. Part of this event focused on helping suspects with a learning disability which was presented by The Scottish Disability Consortium.”

The PDSO is the largest single organisation providing criminal legal aid in Scotland and, as part of the SLAB, is directly required to meet the general duty. Many of these steps, for instance, including equality training as part of annual CPD for solicitors, considering ways to ensure accessible meetings with clients, or how to communicate with clients with protected characteristics, will already be undertaken by firms as part of their existing legislative requirements as service providers.

19 Regulations 7 and 8, ibid 20 Equalities Mainstreaming and Equality Outcomes, Scottish Legal Aid Board, April 2013

The report also outlines the work that the SLAB has done around equality and procurement, including corporate social responsibility as standard award criteria in all contracts: “[i]n some tender exercises contractors are requested to supply corporate equality statements and policies.” Considering equality as part of the procurement process is a specific duty: like other public contracts, equality would likely be an element of legal aid contracts.

SPECIFIC DUTY – PUBLIC PROCUREMENT

Regulation 9 states the specific duty around procurement and equality:

“(1) Where a listed authority is a contracting authority and proposes to enter into a relevant agreement on the basis of an offer which is the most economically advantageous, it must have due regard to whether the award criteria should include considerations to enable it to better perform the equality duty.

(2) Where a listed authority is a contracting authority and proposes to stipulate conditions relating to the performance of a relevant agreement, it must have due regard to whether the conditions should include considerations to enable it to better perform the equality duty.

(3) Nothing in this regulation imposes any requirement on a listed authority where in all the circumstances such a requirement would not be related to and proportionate to the subject matter of the proposed agreement.”

This specific duty would apply to the SLAB, should contracting be introduced. As will be seen in the following chapter, the SLAB is a contracting authority within the scope of the Public Contracts (Scotland) Regulations 2012. 21 However, as legal services are a Part B service, there is no current requirement to enter into an agreement on the basis of the most economically advantageous tender (the MEAT approach) and so Regulation 9(1) may not apply. In any event, proposals for legal aid contracting would engage the provisions of Regulation 9(2) and with a likely similar result. Indeed, the SLAB’s procurement policy, Doing Business with the Board, 22 explicitly recognises equality as a factor in its considerations:

“The Board will actively encourage Small and Medium sized Enterprises (SME) to do business with us and is committed to the development and promotion of equality of opportunity for all… The Board is committed to sustainable procurement. This is where the procurement process is focussed on achieving value for money on a whole life basis and generating benefits not only for the Board, but also for society, the economy and the environment. Issues of sustainability and corporate social

21 SSI 2012/88 22 Doing Business with the Board, Scottish Legal Aid Board (http://www.slab.org.uk/about-us/business), last accessed 30 November 2013

responsibility will be considered and incorporated in the procurement process wherever appropriate.”

As Regulation 9(3) states, and as with public bodies and equality more generally, due regard involves relevance and proportionality. 23 The Equality and Human Rights Commission (EHRC) has provided guidance to public authorities in Scotland around procurement. 24 In deciding whether a procurement exercise relates to the PSED, EHRC advises:

“How public authorities establish the degree of relationship will vary according to the individual procurement but will be shaped by the value, scale and potential impact of the agreement and other factors such as level of contact with the public or the authority’s workforce.

Proportionality relates both to the level of regard due and to any award criteria and conditions relating to the performance of a relevant agreement.

They should be proportionate to the degree of relationship between equality and the subject matter. For example, decisions a local authority makes about the provision of social care for older people compared to those regarding the purchase of road maintenance materials, is related to the aims of the duty, and so it will need a higher degree of due regard.”

There has been recent debate around procurement and proportionality, in part as a result of the Government Equalities Office Review of the Public Sector Equality Duty: Report of the Independent Steering Group. 25 The Independent Steering Group suggested that the way in which equality is incorporated into the procurement process can be overly bureaucratic, not necessarily relevant or proportionate: The perception, the Group observed, is that equality in many procurements is a ‘box ticking’ exercise. However, it was acknowledged:

“All the people and organisations the review team and Chair spoke to, whether from the private sector or public sector, had a strong view that equality and diversity considerations should be part and parcel of good service delivery, regardless of the existence of the PSED.”

The Independent Steering Group also considered the impact of equality in procurement and SME participation and there was widespread recognition from businesses involved in the review that this could be a barrier. The requirements set by many public bodies were perceived as inflexible, for instance, the regular requirement for an equality and diversity strategy, though this is not specifically required by legislation. The costs of demonstrating

23 For instance, Pieretti v Enfield LBC [2010] EWCA Civ 1104 24 Procurement and the Public Sector Equality Duty: A Guide for Public Authorities (Scotland), Equality and Human Rights Commission Scotland, 2013 25 Review of the Public Sector Equality Duty: Report of the Independent Steering Group, Government Equalities Office, 9 September 2013

these requirements were perceived as burdensome and often “process for process’s sake”. However, there was also evidence that many public bodies believe that the PSED is helping to support SME organisations and, indeed, some bodies are using different criteria for smaller and larger organisations to allow for broader participation in the procurement process. Arguments around SME discrimination have also been raised in litigation, and the next chapter will consider a particular example around procurement law and insolvency services.

The Legal Services Commission, for instance, established equality terms for its legal aid providers. The Standard Contract required providers to have and review an equality and diversity policy, a communications plan (to outline to the public a firm’s equality and diversity standards), an equality and diversity training plan, to have no findings of unlawful discrimination, and to provide equality and diversity information to the LSC about clients and also staff. Support to secure some of these requirements was provided, such as a sample equality and diversity policy, and ranging guidance was provided to set expectations for how equality terms would be measured.

The current provision of criminal legal aid in Scotland largely falls into the micro-business category of SME (less than 10 employees relative to up to 249 for SMEs overall). 26 For instance, 18% of solicitors work in firms with one registered criminal legal aid practitioner; 53% of in firms with three or less; and 72% in firms with five registered practitioners or less. Firms may also have other staff, solicitors working in areas outside criminal legal aid, for instance, or support staff, though the overall scale of provision currently involves small business units. The size of firms by number of registered criminal legal aid practitioners is included at Annex 1A.

A system of contracting would need to ensure sustainable provision, and the current scale of this must be recognised. Ensuring that equality requirements are proportionate and if contracting is introduced, proactive support from the SLAB may be useful. LSS has also been taking steps to assist solicitors and firms around equality and diversity: though firms are not bound by the PSED, there are legislative requirements that do apply, particularly as service providers and employers.

SERVICE PROVIDERS

There are a number of legal requirements for organisations providing services to the public. These requirements apply to all service providers, irrespective of size. Firms, as service providers, are prevented from discrimination, harassment or victimisation, as specified by s29 of the 2010 Act:

26 Commission Recommendation of 6 May 2003, concerning the definition of micro, small and medium-sized enterprises (2003/361/EC)

(1) A person (a “service-provider”) concerned with the provision of a service to the public or a section of the public (for payment or not) must not discriminate against a person requiring the service by not providing the person with the service.

(a) A service-provider (A) must not, in providing the service, discriminate against a person (B)—

(b) as to the terms on which A provides the service to B;

(d) by subjecting B to any other detriment.

(2) A service-provider must not, in relation to the provision of the service, harass—

(a) a person requiring the service, or

(b) a person to whom the service-provider provides the service.

(3) A service-provider must not victimise a person requiring the service by not providing the person with the service.

(4) A service-provider (A) must not, in providing the service, victimise a person (B)—

(a) as to the terms on which A provides the service to B;

(b) by terminating the provision of the service to B;

Though many criminal legal aid clients will not be required to make a contribution towards their service, these requirements apply irrespective of whether the service is provided for payment or not. There is also the duty to make reasonable adjustments in the provision of services to prevent disabled people from being substantially disadvantaged in accessing services, which, as s20 of the Act describes, has three requirements:

(3) The first requirement is a requirement, where a provision, criterion or practice of A's puts a disabled person at a substantial disadvantage in relation to a relevant matter in comparison with persons who are not disabled, to take such steps as it is reasonable to have to take to avoid the disadvantage.

(4) The second requirement is a requirement, where a physical feature puts a disabled person at a substantial disadvantage in relation to a relevant matter in

comparison with persons who are not disabled, to take such steps as it is reasonable to have to take to avoid the disadvantage.

(5) The third requirement is a requirement, where a disabled person would, but for the provision of an auxiliary aid, be put at a substantial disadvantage in relation to a relevant matter in comparison with persons who are not disabled, to take such steps as it is reasonable to have to take to provide the auxiliary aid.

This is an anticipatory and continuing duty, requiring adjustments to be made proactively: waiting to make a reasonable adjustment until a disabled person attempted to access a service would not be sufficient. It is not permissible to charge the disabled person for the reasonable adjustment to be made: most adjustments cost little to implement and accessible services can be effective for business as well as ensuring legal compliance.

The adjustment must be reasonable, though there is no definition of what constitutes reasonableness in the 2010 Act. This will depend on a number of factors, including the likely cost or disruption of the adjustment, the resources available to the service provider, the level of resources already committed to making adjustments and the effectiveness of the adjustment. As has been noted previously, with current criminal legal aid providers being micro-businesses in the main, resources may be a particular constraint; equally, firms may already have made a number of reasonable adjustments in a number of areas.

Firms providing criminal legal aid are already required to make reasonable adjustments. In the dialogue events around legal aid contracting in July and August 2013, possible contract criteria were discussed, including around accessibility, which was also mentioned in the SLAB paper, The Context for Contracting. As the duties as service providers are extant, evidencing these may be part of a procurement process. Firms may want to consider the reasonable adjustments that have already been made, and how these could be documented, as well as considering other reasonable adjustments that can be made. LSS has published guidance, Ensuring Fairness, Creating More Accessible Services, offering practical steps on how this can be achieved. 27 There is also complimentary online CPD available on the topic.

EMPLOYERS

The Equality Act 2010 also places obligations on firms as employers, prohibiting discrimination and victimisation against employees and applicants for employment, as well as requiring firms to make reasonable adjustment for either (s39).

27 Ensuring Fairness, Creating More Accessible Services, Law Society of Scotland, October 2013 (http://www.lawscot.org.uk/media/647278/ensuring%20fairness,%20creating%20more%20accessible%20serv ices.pdf), last accessed 1 November 2013

Many firms providing criminal legal aid are sole practitioners, and many have few employees. Processes for recruitment, training, pay and promotion, dealing with grievances and performance issues may be limited or informal. As an extant legal requirement, it may be useful for firms to review processes in place, and to consider how these could be documented or evidenced if required in a procurement process.

A structured approach to equality and employment delivers a number of benefits in addition to legal compliance, including staff retention and increased performance. LSS has guidance relating to these issues, including Ensuring Fairness, Creating Opportunity: A Practical Guide to Equality and Diversity for Scottish Solicitors, Preventing Bullying and Harassment in the Profession, 28 and The Experiences of Ethnic Minority Background Solicitors in Scotland. 29

STANDARDS OF CONDUCT

The LSS Standards of Conduct also deal with equality and diversity issues, in line with the requirements of the 2010 Act. There are also specific requirements for solicitors in a managerial or supervisory capacity, around employment, training and accessibility of services:

“B 1.15.1 You must not discriminate on the grounds of age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, religion or belief, sex or sexual orientation in your professional dealings with other lawyers, clients, employees or others.

B 1.15.2 Where you act in a managerial capacity or supervise others you must ensure that:

(a) there is no unlawful discrimination in employment including recruitment, training, employment terms, promotion, advancement and termination of employment;

(b) those you manage or supervise do not discriminate unlawfully;

(c) you and those you manage or supervise, have appropriate awareness and understanding of the issues surrounding equal opportunities, unlawful discrimination, equality and diversity; and

28 Preventing Bullying and Harassment in the Profession, Law Society of Scotland, July 2011 (http://www.lawscot.org.uk/media/291102/preventing_%20bullying%20_and_%20harassment_%20report%2 0_june_2011.pdf), last accessed 1 November 2013 29 The Experiences of Ethnic Minority Background Solicitors in Scotland, Law Society of Scotland, April 2011 (http://www.lawscot.org.uk/media/280791/ethnic%20minority%20solicitors%20final%20report.pdf), last accessed 1 November 2011

(d) there is no unlawful discrimination in the provision of legal services, and that those to whom legal services are provided can access them in a manner most appropriate to their needs.”

The SLAB notes the effect of the Standards of Conduct in its report, Equality Mainstreaming and Equality Outcomes: “We are reliant on the Society as the regulator to enforce their Code of Conduct regarding standards of services and we currently have no contractual relationship with solicitor firms who provide services under legal assistance.” The report notes, however, that the SLAB Code of Conduct for Criminal Work allows the SLAB to reinforce the LSS requirements. Also, the report shows a specific example of how equality issues are considered: in criminal quality assurance, each review asks the question, “Has the solicitor taken all reasonable steps to address any issues relating to age, disability, race, gender, religion or belief and sexual orientation which arose in the course of the case?” Legal aid contracting, clearly, is not the only mechanism by which equality standards can be achieved. However, it can be argued that contracting presents the SLAB with the opportunity to ensure the mainstreaming of equality in the procurement process and consistency with the approach taken to equality and procurement across the public sector in Scotland.

DEMOGRAPHY

Policy-making is a function of a public authority and this entails that ‘due regard’ will be required in developing any policy for criminal legal aid. Two elements that may need to be considered are the characteristics of the end users of legal aid services, the public, and the composition of the practitioners that currently provide legal aid.

CRIMINAL LEGAL AID CLIENTS

From the 2011 census, the population of Scotland, overall, is around 5.3m: of this, 1,040,000 people had a long-term activity-limiting health problem or disability. Around 200,000 or 4% of the population are from a minority ethnic background, 141,000 with Asian and 61,000 with White: Polish. 30

The SG Strategy for Justice in Scotland 31outlines other demographic trends: for instance, that the peak rate of conviction for men in 2010/11 is in the 18-20 age range (110 per 1,000 population, relative to the male average of 47 per 1,000); and for women, in the 26-30 range (at 19 per 1,000, around twice the female average). It also noted the increase in the rate of female imprisonment, increasing at 70% over the last decade, compared to a 25% increase for male imprisonment. From research in other jurisdictions, a high prevalence of

30 2011 Census: Key Results on Population, Ethnicity, Identity, Language, Religion, Health, Housing and Accommodation in Scotland - Release 2A, National Records for Scotland, September 2013 31 The Strategy for Justice in Scotland, Scottish Government, September 2012

mental health issues has been found in prison populations: 50% of prison entrants, according to research by the HM Inspectorate of Prisons had primary or secondary mental health needs and around 17% disclosed a psychiatric history. 32

CRIMINAL LEGAL AID PROVIDERS

To meet effectively the needs of the range of client groups, it is important that there is a diverse and sustainable criminal bar in Scotland. In addition, the Legal Services (Scotland) Act 2010 establishes regulatory objectives for alternative business structures (ABS) and the regulators of these. These objectives include “promoting an independent, strong, varied and effective legal profession” and “encouraging equal opportunities… within the legal profession” (s1(d)(e)).

The LSS research, Profile of the Profession 2013: Demographics and Work Patterns of Scottish Solicitors, 33 provides information on a number of protected characteristics across the profession as a whole. On age, for instance, it was found that 79% of respondents were between 25 and 55 years of age: there were significantly more female respondents in the 25 to 35 age group (43% to 23% for male respondents); and there were significantly more male respondents in the 56 years of age and older group (28% to 9% for female respondents). On ethnic background, 86% of respondents identified themselves as White: Scottish, 10% from other ‘white’ ethnic groupings (British, Irish, Gypsy/traveller, Polish and another group), and 2% from any other ethnic group. On disability, 4% of respondents had a disability: 38% had a long term illness; 22% had a sensory impairment; and 20% had a physical disability. Of the respondents with a disability, 52% had not requested or required a reasonable adjustment; 27% had requested and received a reasonable adjustment; and 5% had requested but not received a reasonable adjustment.

As part of its contracting work, LSS carried out detailed analysis of the age and gender of registered criminal legal aid practitioners in October 2013. The results in many ways followed trend, particularly that the majority of solicitors entering the profession overall are currently female; and in some ways deviated from the trend, such as the relative paucity of solicitors in the 30-39 age group by comparison with the overall profession and also the preponderance of solicitors, primarily male, in the 40-60 age group.

32 The Mental Health of Prisoners: A Thematic Review of the Care and Support of Prisoners with Mental Health Needs, HM Inspectorate of Prisons, October 2007 33 Profile of the Profession 2013: Demographics and Work Patterns of Scottish Solicitors, Law Society of Scotland, October 2013

With around half of currently registered solicitors below the age of 50, there does not appear to be an immediate challenge around the sustainability of the profession over time. This age distribution is consistent with the age distribution of the solicitor profession overall, which sees more female than male trainees or associates, but the converse for principals in private practice, consultants and directors. Broadly, there are more female than male entrants to the profession overall, and this is reflected in the number of young lawyers registered for criminal legal aid at a ratio of roughly 2:1 between female and male solicitors.

The number of solicitors in the 30-40 age group is disproportionately smaller than that for the profession overall: this can be seen more clearly in the data on the number of registered solicitors by date of birth found at Annex 1B. This is a feature for both male and female solicitors, and may merit further investigation. It may be that requirements around police station work make practice difficult for those in an age group more likely to be raising families, for instance. There are also a significant number of solicitors in the 24-29 age group, new lawyers to the profession. This increase comes at a time at which training contracts for the sector have not increased. It would appear that solicitors are being trained in other sectors and then joining criminal practice. In certain other sectors, there have been instances of trainees not retained on qualification: this may be temporary, as firms and organisations move closer to matching need to demand in trainee places. Whether this significant influx of solicitors trained outside the sector continues as the economic downturn subsides, or whether this remains a trend would require further research.

REMEDIES

In situations in which public bodies do not have due regard to the general or specific duties, this can be challenged. Challenges need to be brought promptly. In the Fawcett Society case, for instance, it was ruled that the application to challenge a decision on equality grounds was not brought in sufficient time: it was six weeks after the Westminster

government’s March 2010 budget that a judicial review on the basis of its unfair impact on women was lodged. 34

As described above, the determinative factors for ‘due regard’ are the Brown principles, which have been considered in a number of cases, including R (Luton Borough Council) v. Secretary of State for Education. 35 This legal challenge involved the closure of the Building Schools for the Future (BSF) programme, which had been introduced by a previous administration and aiming to refurbish every secondary school in England between 2005 and 2020. An equality impact assessment had been carried out; however, this had been conducted after the decision to terminate the project had been taken. The impact on schools with specialist support for particular disabilities, single sex schools, faith schools or others had not been evaluated (and there had also not been any consultation. The judgment concluded that this evaluation and consultation would need to take place. Holman J said:

“[The Secretary of State] unlawfully failed to give due regard to the equality impacts of his proposed decision. He must now, after giving each of them a reasonable opportunity to make representations, reconsider his decision insofar as it affects the claimants and each of the projects in relation to which they have claimed, with an open mind, paying due regard to any representations they may make, and rigorously discharging his equality duties… the extent of my decision is that the Secretary of State must, I stress must, reconsider the position of each of the claimants with an open mind and paying due regard to whatever representations they may respectively make. But provided he discharges that duty and his equality duties, the final decision on any given school or project still rests with him. He may save all, some, a few, or none. No one should gain false hope from this decision.”

In Public Interest Lawyers v. Legal Services Commission, 36 the question of due regard under the Disability Discrimination Act 1995 (since superseded by the Equality Act 2010) in the tendering of public law and mental health was considered. In this case, it was argued that the tendering of these categories of work generally and, more specifically, for the high security hospital units at Ashworth, Broadmoor and Rampton had breached the general disability equality duty in section 49A of the 1995 Act. As judicial review proceedings had been initiated over eight months since the tender proposals had been made available, this delay meant that the proposals could not be challenged on equality grounds; however, it was argued that the outcome of the process engaged this duty. The scale of the reduction in providers of mental health services to the three secure units had reduced from 40 to 5, which would see a number of clients losing their long-standing representatives. Expert

34 R (Fawcett Society) v Chancellor of the Exchequer [2010] EWHC 3522 (Admin) 35 [2011] EWHC 217 (Admin) 36 [2010] EWHC 3277 (Admin)

opinion said that the effect of this change could be severe. Dr Gupta, lead clinician for the high security deaf service for mental health services, stated:

“The majority of them have been discriminated against and mistreated throughout their lives and I am sorry to say that to simply remove the legal representative who has known them well for many years, has understanding of their hearing impairment and a good working knowledge of the difficulties in dealing with deafness and mental disorder, is to simply compound the abuse and discrimination they have already suffered.”

The impact of a reduction in client choice on patients had not been raised in consultation around the tendering process, though it was held that the Legal Services Commission had due regard, specifically as it was looking to improve the quality of advice provided. Cranston J said:

“In my view the Legal Services Commission is entitled to say that it had due regard to the position of patients in the high security hospitals in striking the balance in favour of improving the quality of legal advice provided to them. After all, there were real concerns with the quality, in a few cases the integrity, of some of the many organisations offering legal advice in these hospitals under the 2007 contract. There was consultation, not least through the Mental Health Stakeholders Group, and with the Mental Health Lawyers' Association. Although the desirability of operating a competitive bid was questioned, the impact on patients of changing their legal advisers was not specifically raised, although it could have been. Some provisions for continuity were incorporated in the tender. Once a considerable number of existing providers decided not to bid, it was clear that many patients would have to change solicitors.”

However, Cranston J maintained that the outcome of the tendering process, which likely saw a number of individuals disadvantaged, did trigger the disability equality duty in section 49A of the 1995 Act: it was not for the court to determine what actions, if any, would be required but simply to indicate that the duty had been triggered. It is unlikely that contracting for criminal legal aid would create the same challenges around client choice. Mental health services for patients in high security hospitals are specialist services to a small and extremely vulnerable client group.

Article 6 of the European Convention on Human Rights is engaged in criminal proceedings, though does not provide significantly wider protection around client choice. Responding to the original proposals for price-competitive tendering in England and Wales, the Equality and Human Rights Commission observed:

“The Commission accepts that case law under the ECHR on legal assistance in criminal matters does not mandate absolute choice (X v UK (1983) 5 EHRR 273).

However, the European Court of Human Rights (ECtHR) has held that legal assistance must be “effective” in order to fulfil the right to a fair trial under Article 6(1) ECHR: Artico v Italy 3 EHRR 1, §33. While the issue will be judged on a case by case basis, factors that the ECtHR will take into account include the extent to which liberty or a serious fine is at stake, and the extent to which lack of funding otherwise undermined the coterminous requirements for ‘adequate time and facility for…preparation’ under Article 6(3)(b) (Godi v Italy 6 EHRR 457). In following the ECtHR’s jurisprudence, the Court of Appeal has moved from a previous common law approach to a more Convention compliant test that focuses on whether the overall requirement for a fair trial has been met: R v Nangle [2001] Crim L.R. 506.

The Commission’s assessment is that these proposals may be open to legal challenge in individual cases. Crown Court judges, required to act compatibly with the Convention under s6 of the Human Rights Act, will have to decide on a case-by-case basis whether ‘one size fits all’ representation by solicitors under the competitive tendering model will deliver a fair trial, particularly in complex cases.” 37

It appears that, in general, the need for client choice has a foundation, albeit narrow, either in terms of equality or human rights. In particular cases or with particular groups, there may be issues around effective representation, due regard and a fair trial. It may be the tendering process itself that is challenged, a point not raised in Public Interest Lawyers because of delay; or it may be the outcome of the process that is challenged. Responding to its consultation on PCT in England and Wales, the Ministry of Justice noted that the proposals to eliminate client choice had been “widely criticised [by 99%]”. 38 As the Ministry of Justice stated:

“[A] number of respondents, including the Law Society argued that the proposed removal of choice would adversely affect clients with a protected characteristic. The LCCSA developed this argument further in its response claiming that the proposal is discriminatory for the young, vulnerable and “those who feel most invested in a lawyer from a BAME firm”…

The Bar Council argued that the extent to which the proposal would impact on both BAME clients and BAME practitioners is ‘seriously underestimated’. They go on to suggest that such an approach would not only have a profound effect on the wider communities BAME providers serve and support but also on the profession as a whole, submitting that it would have “an obvious retrograde impact on the enormous progress that has been made in recent years in improving the diversity of the Bar and the judiciary”.

37 Response of the Equality and Human Rights Commission to the Consultation: Transforming Legal Aid: Delivering a More Credible and Efficient System, Equality and Human Rights Commission, June 2013 38 Annex B, Transforming Legal Aid: Next Steps, Ministry of Justice, September 2013

There are, obviously, restrictions already on client choice for criminal legal aid. A system of contracting does not necessarily entail further reduction in client choice; equally, the number of providers could be reduced without necessarily engaging the degree of difficulty found in Public Interest Lawyers.

CONCLUSIONS

It is a specific objective outlined in the SG White Paper, A Sustainable Future for Legal Aid, that a contracting system would include equality factors; indeed, this is consistent with the sustainable approach to public procurement of works, goods and services in Scotland overall.

DEMONSTRATING COMMITMENT TO EQUALITY

The SLAB paper, The Context for Contracting, suggested commitment to equality and accessibility of services as possible criteria options for criminal legal aid contracts. Requirements around equality in procurement must be relevant and proportionate and cognisance of the current size of providers is important. However, there already exist a number of requirements through the Equality Act 2010 and the LSS Standards of Conduct. Firms may wish to consider the ways in which they meet these extant requirements and how they could document and evidence these in a procurement process. The equality criteria of a contract may not be prospective, namely the actions that would be taken if the contract is secured, but may rather require demonstration of existing practices around equality.

GUIDANCE AROUND EQUALITY

There is practical guidance from LSS available, along with online CPD. There are also a number of other sources of advice, such as from EHRC, and other sources of training. Firms may want to consider reviewing their equality processes, irrespective of any contracting system that might be introduced, to ensure compliance and indeed effective businesses.

EQUALITY CHALLENGES

The design of a contracting system will need to have due regard to equality issues. There are, as the first part of this chapter considers, a number of ways in which equality is likely to feature and may well enhance equality above the current legislative framework. Contracting may reduce or change the composition of provision, but is unlikely to feature the particular hardship to clients envisaged in the Public Interest Lawyers case. There may be features of current provision, for instance, the age and gender of providers, that will need to be recognised. However, as the Brown principles show, the duty to have due regard requires cognisance of the equality impacts rather than direct action to reduce them.

ANNEX 1A – FIRM SIZE BY NUMBER OF REGISTERED CRIMINAL PRACTITIONERS

Firm size - by number of registered criminal practitioners 300

250

200

150 Numberoffirms

100

0 1 2 3 4 5 6 7 8 9 10 11 12 13 16 26 Firm size by number of registered criminal practitioners

ANNEX 1B – AGE AND GENDER OF CRIMINAL LEGAL AID PRACTIONERS

Registered practitioner year of birth - overall 70

0 1989 1984 1979 1974 1969 1964 1959 1954 1949 1944 1939 1934

Registered practitioner year of birth - male and female 70

0 1989 1984 1979 1974 1969 1964 1959 1954 1949 1944 1939 1934

Male Female

Move to public procurement process

• Goods and services are procured by the public sector on a vast scale • The framework for public procurement is broadly established • However, little time to acclimatise current legal aid providers

Changing procurement landscape

• New EU directive sees abolition of distinction between Part A and Part B services • "Light touch" regime leaves substantial discretion in transposition • Procurement Reform (Scotland) Bill will introduce new factors, such as community benefit clauses

Need for equal treatment and transparency

• Contract criteria must be appropriate, relevant and proportionate • Need not be advised before tender round • Nor necessarily capable of meeting by all providers

Importance of bidders protecting position

• Consequences of mistake • Possibility of merger, consortia, new staff and resources • Importance of preparing for contracting

CHAPTER TWO – CONTRACTING AND PROCUREMENT

Goods and services are procured by public bodies in Scotland on a vast scale. The SG Scottish Procurement Policy Handbook 39 provides a wide definition of public procurement:

“Public procurement can be defined as the acquisition, whether under formal contract or otherwise, of goods, services and works from third parties by contracting authorities.

The scope of public procurement ranges from the purchase of routine supplies or services, to formal tendering and placing contracts for large infrastructure projects by a wide and diverse range of contracting authorities.”

The public procurement regime – comprising elements ranging from EU Treaty obligations and European Directives to secondary legislation and government guidance in Scotland - applies to a substantial proportion of public expenditure and a wide range of goods and services. This framework aims to deliver quality and value through public procurement processes, providing core principles that apply to all types of procurement, goods and services, larger or smaller scale purchasing.

In 2006, the Review of Public Procurement in Scotland (the McClelland Review) 40 estimated that over a quarter of all public expenditure involved public procurement: with an overall Scottish Executive expenditure of around £30bn, around £8bn involved procurement, with local authorities procuring around £2.3bn, health procurement of around £2bn, universities and colleges procuring around £800m and procurement from organisations such as Scottish Water, the Scottish Executive Roads Department and Communities Scotland having procurement expenditure of in excess of £1bn.

Public procurement is a key component to the operation of public bodies, in Scotland and across Europe. There are clear rules, notably the Public Contracts (Scotland) Regulations 2012, recognised expertise across the public sector, and broad precedent from domestic and EU case law. In short, this is a firmly embedded process and one which many organisations across the private sector, including SMEs, already engage with regularly. The SLAB, indeed, are proficient with public procurement, currently procuring goods and services of around £4m annually and were rated with ‘improved performance’ in their last Procurement Capability Assessment. 41

39 Developed in response to the Review of Public Procurement in Scotland, which recommended, “A public sector wide Procurement Policy Handbook should be established offering a standard and well documented approach to be utilised across all of the public sector.” 40 Review of Public Procurement in Scotland, John F. McClelland CBE, 2006 41 Annual Report 2011-12, Scottish Legal Aid Board (‘improved performance’ is an assessed status of the overall procurement capability of the organisation assessed in the Procurement Capability Assessment rather than a statement of the organisation’s procurement status over a time period)

Public procurement will be familiar to a number of firms currently providing criminal legal aid, though we anticipate this to be a small minority. The delivery of criminal legal aid has historically been provided under a statutory framework, falling outside the scope of public procurement. Many firms provide only criminal services and, overall, 179 firms providing criminal legal aid in 2011-12 recorded no grants of civil legal assistance. 42 The introduction of contracting would likely see criminal legal aid brought within the scope of public procurement, though a small number of contract models could operate outside its scope, for instance, a system of licencing any provider that is on or joins the criminal legal aid register. This chapter will outline the public procurement process and how it might influence the ways in which firms will be selected to provide criminal legal aid in a contracting system, the terms and conditions under which legal aid might be delivered and practical steps that firms may want to consider in preparing for a public procurement process.

As the public procurement process in England and Wales is largely identical, the experience from this jurisdiction will be considered. Many of these examples related to contracting for civil legal aid and it is fair to note that many of the difficulties and legal challenges around contracting in England and Wales have related to civil rather than criminal contracting. The broad principles, however, remain the same. Many people reading this document will be legal professionals, and in that context it may seem redundant but still important to note that the caselaw examined represents an extremely small proportion of overall public procurement. Taking the example of England and Wales, for instance, the large majority of legal aid tenders proceeded without widespread difficulty.

However, the consequences of challenge in that extremely small minority of cases can be far-reaching for the public bodies buying goods or services, both in terms of continuing delivery and also in the costs of rectifying the error in the procurement process. The successful challenge to the procurement of family law services in 2010, for example, was estimated to cost around £290,000 in legal expenses and the unrecoupable part of the £1.6m expended on the tender. 43 Providers can also make mistakes during the public procurement process and the consequences of these can be even more far-reaching. Criminal law, like a number of other practice areas, is mainly funded through legal aid. If contracts are awarded for fixed periods, it may be some time before a firm could feasibly re- enter the market. For specialist firms, it may simply not be viable to continue outside the contracting system until the next tendering window. It is for SG and the SLAB to determine the criteria for contracts: some firms may not reach this standard, though it is the particular

42 Information on number of grants of legal assistance provided to Law Society of Scotland; number derived from Law Society of Scotland analysis of grants 43 Giving evidence to the House of Commons’ Justice Committee in November 2010, Ruth Wayte, Legal Director at the LSC stated, “The family element, which obviously we need to have another go at, cost in the region of £1 million of project costs. That is over three years as we develop the process and includes the tender itself. In addition to that, we invested in some e-tendering software, which we will have now and for the next three years. That cost in the region of £600,000.”

concern of this chapter that firms that can meet these standards but are unfamiliar with public procurement have an understanding of this framework and some of the challenges to enable them to demonstrate their competence and bid successfully.

One of the key aims of public procurement rules across Europe is to encourage cross-border trade and development. In the procurement of services, there is a distinction made between Part A or ‘priority’ services and Part B or ‘residual’ services: the former are services such as IT or accounting, which are likely to see interest from bidders in other Member States; the latter are services such as education and legal services, which are unlikely to see interest from bidders in other Member States. As legal aid contracting is for a Part B service, the procurement requirements are limited (whereas Part A services are subject to a more rigorous process). A new EU Directive on public procurement is currently being negotiated, which may see the distinction between Part A and Part B services removed. This may come into effect around the time that, according to the SG timetable, legal aid contracts may be tendered. Because of this development, the process for both Part A and Part B services will be outlined.

The Procurement Reform (Scotland) Bill was laid before the Scottish Parliament on 3 October. This Bill sees the introduction of requirements on contracting authorities to produce procurement strategies and annual reports on procurement, establishes a legislative framework for contracts below the current EU public procurement thresholds, encourages SME participation, inclusion of community benefit clauses, encourages participation by supported businesses (those with 50% or more employees having a disability), promoting the proposal of novel or innovative ways to deliver goods and services and other measures. These legislative proposals will have a significant impact on the development of criminal legal aid contracting proposals, and the impact of this will be considered later in the chapter.

PUBLIC CONTRACTS (SCOTLAND) REGULATIONS 2012

The framework for public procurement is ranging, involving EU Treaty obligations and Directives, the jurisprudence of the European Court of Justice (ECJ), the regulations that transpose the Directives into domestic law, the case law of domestic courts and domestic reform of procurement rules and practice within this overall framework.

There are a number of objectives for robust systems of public procurement, often overlapping, including: value for money; integrity; accountability; equal opportunity and equal treatment of providers; fair treatment of providers; efficient implementation of social, industrial and environmental objectives (such as a requirement to meet the public sector

equality duties); opening up markets to international trade; and efficiency in the procurement process. 44

The 2004 Directive 45 states the award of public contracts “is subject to the respect of the principles of the Treaty [on the Functioning of the European Union] 46 and in particular to the principle of freedom of movement of goods, the principle of freedom of establishment and the principle of freedom to provide services and to the principles deriving therefrom, such as the principle of equal treatment, the principle of non-discrimination, the principle of mutual recognition, the principle of proportionality and the principle of transparency.” This Directive was transposed into Scots law by the Public Contracts (Scotland) Regulations 2006 47 and since replaced by the Public Contracts (Scotland) Regulations 2012. 48 For Part B services, it is compliance with these broad principles – particularly equal treatment of economic operators, non-discrimination and transparency – that is important. Unlike Part A services, the process requirements are limited.

In assessing the ambit of the public procurement framework, the Scottish Public Procurement Toolkit 49 highlights three initial questions to determine if the 2004 Directive applies: 50

Is the awarding body a contracting authority?

Does the value of the contract exceed the threshold?

Is there a general or special exemption?

Each of these questions will be considered in turn to see whether the answers may apply for criminal legal aid contracts in Scotland. The answers to these questions may be straightforward, though may also provide a useful frame of reference for considering some of the caselaw examples detailed, which range from the provision of rock salt to local authorities in inclement weather to the provision of contracted healthcare services.

CONTRACTING AUTHORITY

The public procurement framework applies to all contracting authorities. In Scotland, these contracting authorities are detailed in Regulation 3 of the Public Contracts (Scotland)

44 Public Procurement Regulation: An Introduction, Professor Sue Arrowsmith, 2011 45 Directive 2004/18/EC of the European Parliament and of the Council of 31 March 2004 on the coordination of procedures for the award of public works contracts, public supply contracts and public service contracts 46 Hereinafter referred to as TFEU 47 SSI 2006/1 48 SSI 2012/88 49 Scottish Public Procurement Toolkit - A step by step guide to producing a strategic sourcing strategy, Scottish Government, 2006 50 And by extension, the 2012 regulations that replaced these

Regulations 2012. While the SLAB is not named in the regulations on contracting authorities, it does qualify as the same through Regulation 3(1) (bb):

“3(1) Contracting Authorities

…(bb) a corporation established, or a group of individuals appointed to act together, for the specific purpose of meeting needs in the general interest, not having an industrial or commercial character, and –

(i) financed wholly or mainly by another contracting authority;

(ii) subject to management supervision by another contracting authority; or

(iii) more than half of the board of directors or members of which, or, in the case of a group of individuals, more than half of those individuals, being appointed by another contracting authority…”

The SLAB is financed by a contracting authority, the Scottish Ministers (Regulation 3(1) (e)), is subject to management supervision by another contracting authority (though a non- departmental public body), and has its board appointed by a contracting authority – appointments to the SLAB Board being approved by the Scottish Ministers. The answer to the question, is the SLAB a contracting authority, can be answered in the affirmative.

CONTRACT VALUE

In establishing whether a contract exceeds the threshold, there are prescribed limits for various types of contracts. These are thresholds on the value of contracts above which the 2004 Directive applies, though this varies depending on the type of supplies, services and works.

The contract thresholds are from 1 January 2012 and net of VAT: 51

Supplies Services Works

Entities listed in Schedule 1 £113,057 £113,057 £4,348,350

51 Scottish Government, website, last sourced 28 August 2013: (http://www.scotland.gov.uk/Topics/Government/Procurement/policy/10613)

Other public sector contracting authorities £173,934 £173,934 £4,348,350

Prior Information Notices £652,253 £652,253 £4,348,350

Small lots £69,574 £69,574 £869,670

There are some exceptions, including a higher procurement threshold for Part B (residual) services for Schedule 1 entities at £156,442. SLAB is, as noted above, not an entity listed in Schedule 1 but is a public sector contracting authority: in the procurement of services, it has a contract value threshold of £173,934 (irrespective of whether these would be Part A or Part B services).

The SLAB recently stated that around 50% of criminal legal aid providers have receipts of less than £50,000 from criminal legal aid per annum. It is not, however, individual contract values but rather, as a matter of principle, the aggregate value of contracts of the same type that determines whether the public contract falls within the scope of public procurement. And for completeness, though the requirements detailed in this section refer to contracts for services, these also apply to contracts for goods.

The estimated value of the public contract is the value of the total consideration payable, net of VAT. 52 The estimated value of a single public contract for services which does not indicate a total price is either, if the contract is for 48 months or less, the aggregate value of the consideration expected to be paid over a 48 month period; or if longer than 48 months or indefinite, the amount expected to be paid monthly, and multiplied by 48. 53

The regulations apply differently should a contracting authority enter into a number of contracts for a single service requirement, though the principle around aggregation of contract value remains. If a contracting authority has a single requirement for services, and fulfills that through a number of separate public contracts for service, the value of the contract is the aggregate which is expected to be paid under each of the contracts. 54 There is an exception, which can be disapplied by the contracting authority: if an individual public contract for services has an estimated value below the small lots threshold, and this and any other contract is less than 20% of the value of the total estimated consideration of all of the contracts let to meet the contracting authority’s requirement for service. 55

52 Regulation 8(8), Public Contracts (Scotland) Regulations 2012 53 Regulation 10, ibid 54 Regulation 11, ibid 55 Regulation 12, ibid

If there is no single requirement for services, but rather a public contract for services more generally, the regulations require a different approach, though again consistent with the principle of aggregation. The valuation is either by the aggregate consideration of public contracts for services with similar characteristics or for public contracts for the same type of services paid under such contracts in the last twelve months; or by estimating the value expected to be paid in the following 12 months under these contracts. 56

It is stated in the regulations that a contracting authority cannot enter into separate contracts or elect a valuation method with the intention of avoiding the application of the regulations. 57

The government has not indicated which areas of criminal legal aid work would be provided under contract. It is possible that for small and discrete areas of work, there could be contracts below the procurement threshold, either on value alone or the exemption provided by regulation 12, if there are individual contracts below the small lots threshold (£69,574) and that this and all other contracts for the same service amount to no more than 20% of the total.

Research by PWC on procurement across Europe 58 has suggested that there is “practically no relationship” between the overall cost of procurement to the contracting authority and the economic operator and the overall value of the contract. This, however, suggests that the overall financial burden of procurement is greater, the smaller the overall contract value:

“[I]n contracts with a value close to the threshold above which EU procurement directives become compulsory (125.000 euro) total procurement costs for business and government amount to about 30 percent of the contract value.”

However, criminal legal aid overall is a significant area of expenditure. In the last financial year, for instance, £69.9m was paid to solicitors (a decrease of £5.3m or 7%). 59 Though it may be challenging to predict the amount paid to individual firms should criminal legal aid contracting be introduced, it is not foreseeable based on the aggregate value of contracts that the value would be below threshold. As seen below, even if it were in some limited cases, the recently introduced Procurement Reform (Scotland) Bill would place some additional requirements on the contracting process. The question, does the value of the contract exceed the threshold? receives a clear affirmative.

56 Regulation 15, ibid 57 Regulation 19, ibid 58 Public Procurement in Europe: Cost and Effectiveness, PriceWaterHouseCoopers (for the European Commission), March 2011 59 Annual Report 2012-13, Scottish Legal Aid Board; £15.9m was paid to counsel (advocates and solicitor advocates); and £5.8m was paid on outlays

GENERAL OR SPECIAL EXEMPTION

There are general and special exemptions from the scope of the public procurement framework: these are detailed in regulation 6 of the Public Contracts (Scotland) Regulations. These exemptions relate to particular types of works, goods and services, such as the exploitation of telecommunication services, contracts classified as secret or requiring special security measures, employment and other contracts of service, service concessions, and other contract types. The answer to the question, is there a general or special exemption? Is the negative.

Contracting for civil legal aid would require primary legislation, and is being considered by SG. 60 An exemption which might affect contracting for civil legal aid, if introduced, is for “arbitration and conciliation services”. 61

PART A AND PART B SERVICES

The procurement of services through public contracts currently makes the distinction between Part A and Part B services, the former broadly being services likely of cross-border interest, the latter broadly being services which are services likely of interest only within the domestic market. Part A services include financial services; computer and related services; market service and public opinion polling services; and advertising services. Part B services include transport by rail; legal services; education and vocational education services; and health and social services. 62

Part A services above threshold are subject to the full procedural requirements of the 2012 regulations; for Part B services above threshold, the procedural requirements are limited. There is no requirement, for instance, to place an advertisement in the Official Journal of the European Union (OJEU); Notice of the contract award will, however, need to be placed in the OJEU within 48 days of contract award 63 and there must be some advertisement of the contract opportunity, with discretion around the scale and channels for that publicity. 64

SELECTION AND AWARD CRITERIA

Though there are established public procurement procedures for works, goods and services above the relevant thresholds, there is great flexibility in how suppliers and providers are

60 A Sustainable Future for Legal Aid, Scottish Government, 2011 61 Regulation 6(2)(f), Public Contracts (Scotland) Regulations 2012 62 Schedule 3, ibid 63 Regulation 31, ibid 64 For instance, “[A] degree of advertising sufficient to enable the services market to be opened up to competition and the impartiality of the procurement process to be reviewed”: was held in Telaustria Verlags GmbH and Telefonadress GmbH v Telekom Austria AG [2000] Case C-324/98

selected and the terms and conditions for the contracts offered. A broad distinction is made between selection criteria and award criteria, the former to establish the suitability of the organisation to be considered to tender for the contract and the latter to judge whether that organisation’s tender for the work contracted is successful. The SG Procurement Journey describes the distinction:

“Selection criteria are focussed on ‘the bidder’ and award criteria is focussed on ‘the bid’ and purchasers must maintain a clear distinction between both throughout the procurement process…

The selection stage, often known as the "pre-qualification stage", involves an examination of the suitability and capability of the potential suppliers to perform the contract that will be awarded at the end of the competition. The criteria used for selection must be appropriate, relevant and proportionate to the particular procurement. The selection process should be a ‘backward-looking, not forward- looking’ process. That is, the criteria for selection must concentrate on the general suitability and capability of the supplier for the project, as opposed to the specific means by which the supplier would perform the contract…

The award stage involves examination of the merits of the bids. This will identify which of the eligible tenderers will deliver best value for money for the organisation, based on either the most economically advantageous tender or lowest price, depending on the criteria agreed… The award criteria must relate directly to, and be proportionate with, the subject matter of the requirement.” 65

For many public procurement exercises, this division between selection and award criteria is met by the contracting authority through the requirement of a Pre-Qualification Questionnaire (PQQ) for selection criteria and an Invitation to Tender (ITT) for award criteria. For Part B services, either above or below threshold, there are no formal procedural requirements either for the selection or award of contracts.

The SLAB has outlined four models for consideration, 66 the first of which, licencing, would simply require all providers having met or meeting in future, to agree a contract for service: likely involving no selection or award criteria, or indeed a public procurement process. The second option would see contracts awarded to all who meet set criteria; the third option would see “contracts awarded to a pre-set maximum number of suppliers” and “contracts awarded to those who score better against the set criteria”; the fourth option is “contracts awarded on price and other criteria to meet the volume of work required”.

65 Procurement Journey, Scottish Government, website, last sourced 28 August 2013 (http://www.scotland.gov.uk/Topics/Government/Procurement/buyer-information/spdlowleve) 66 Context for Contracting, Scottish Legal Aid Board, website, last sourced 28 August 2013 (http://www.slab.org.uk/providers/reforms/criminal/Contracting/ContextForContracting.html)

The SLAB outlines possible ‘criteria – options’: enhanced quality standards; performance in peer review; demonstrable expertise and experience; capacity to deliver volume of work required; sound business management; commitment to equalities; and accessibility of services.

As the SG outlines in its Procurement Journey, selection criteria must be appropriate, relevant and proportionate to the particular contract and the same with the award criteria: these requirements apply, in particular, to above threshold contracts, though likely apply to those contracts that fall outside the scope of the relevant Directives.

Some of these factors raised by the SLAB at this stage might ultimately be selection criteria or award criteria if contracting is introduced. For fairness to new entrants in the market, which will be considered later, some criteria options suggested could not readily be introduced with contracting, such as previous performance in peer reviews. Equally, with the SLAB having outlined the National Outcomes against which performance of public services are judged, 67 and as highlighted in the previous chapter, there may be requirements that reach far beyond the current statutory regime. If contracting is introduced, firms and solicitors will need to be aware of the context of these extra requirements. The SG and the SLAB may outline some of the thinking around possible selection and award criteria in the formal consultation document expected by the end of 2013: practitioners are strongly recommended to consider these and how they could affect their businesses.

PROCUREMENT PROCESS FOR PART A SERVICES

Part A services above threshold require a comprehensive process, involving advertisement in the OJEU. Barring the open process, there is a formal adjudication on whether interested parties meet the selection criteria (and even with the open process, the contracting authority can specify requirements and exclude providers from the process at this selection stage). Overall, the procedure for Part A services above threshold follows one of four different procurement procedures:

Open – all interested parties can request contract documentation from the contracting authority and all submit a tender to the contracting authority simultaneously: there is no negotiation between the interested parties and the contracting authority. The contracting authority can evaluate all tenders or can exclude tenders failing to meet any selection criteria set. Restricted – all interested parties can request contract documentation from the contracting authority but only those parties that successfully meet the selection

67 National Outcomes, Scottish Government, website, last sourced 28 August 2013 (http://www.scotland.gov.uk/About/Performance/scotPerforms/outcomes)

criteria will be invited to tender for the contract: there is no negotiation between the interested parties and the contracting authority. Competitive dialogue – all interested parties can request contract documentation from the contracting authority but only those parties that successfully meet the selection criteria will be invited to join competitive dialogue. The contracting authority discusses all aspects of the contract with each party, developing individual solutions with each, each party then tendering on the terms of the proposal agreed by each with the contracting authority, with the contracting authority selecting the best tender. Negotiated – the contracting authority can enter into negotiations with a supplier without advertisement, or following advertisement, with those parties that have successfully met the selection criteria. Whether with or without advertisement, the contracting authority will directly negotiate the parties on the terms of the contract and the procedure followed.

There are other rules around Part A services procurement, for instance, the minimum number of bidders - 5 for restricted and 3 for competitive dialogue and negotiated (with advertisement); a minimum ‘standstill’ period of between 10 and 15 days following notification of contract award to allow unsuccessful tenderers to raise any objections; 68 and award of contracts based either on lowest price or most economically advantageous tender (MEAT), which can include price along with other factors such as quality and capacity - indeed, MEAT evaluations do not necessarily require price as a factor.

TFEU PRINCIPLES

In addition to the process requirements for above threshold Part A and Part B services, there is also the need to comply with the overarching TFEU principles: non-discrimination, equal treatment and transparency. Indeed, public contracts below threshold may also be subject to the TFEU principles: the ECJ stated in Bent Mousten Vestergaard v Spøttrup Boligselskab 69 that “although certain contracts are excluded from the scope of the Community directives in the field of public procurement, the contracting authorities which conclude them are nevertheless bound to comply with the fundamental rules of the Treaty.”

The overall application of the TFEU principles depends on the likely interest in the contract from economic operators in the Internal Market. If it is likely to be of interest, then the contract must be awarded in accordance with the TFEU principles. Equal treatment and no- discrimination require, for instance, sufficient advertising to open the market up to competition. The greater the interest of the contract to the Internal Market, the wider the advertisement should be.

68 Following Alcatel Austria v Bundesministerium fuer Wissenschaft und Verkehr, Case C-81/98 [2005] 69 [2001] Case C-59/00

The impartiality of the contract process must be capable of review and the remedies at least equivalent to those available in domestic law and should open both to those economic operators who had an interest in obtaining the contract. 70

REMEDIES

There are remedies available for a breach of EU procurement law, though short timescales in which challenges can be brought. Under the 2012 Regulations, there is the requirement to bring action within 30 days of the challenger becoming aware of the breach, though there is judicial discretion to extend this to three months for good reason. 71 Actions would be required to be brought as commercial actions in the Sheriff Court (or Court of Session) and for failing to comply with Part B requirements, which are, as described above, limited in scope.

It is also possible to complain to the European Commission and ask it to intervene or to bring action for judicial review, to look to set aside the contracting authority’s decision as ultra vires.

PROCUREMENT REFORM

There are a number of changes to the ways in which public procurement reform will operate, at an EU and domestic level, which may have an operative effect on proposals for criminal legal aid contracting. Three new procurement directives are being negotiated, a revised public sector directive, a revised utilities directive and a service concessions directive. The new directives are likely to be published in the OJEU in autumn 2013 and would require transposition within an eighteen month period. In normal course, transposition takes place at the very end of that period, 72 though the Cabinet Office Procurement Policy Note of July 2013 notes the preparation of “an ambitious transposition timetable” that may see earlier effect in England and Wales and Northern Ireland. 73 It will be for the Parliament at Holyrood to determine appropriate transposition for Scotland.

The Procurement Reform (Scotland) Bill was introduced to the Scottish Parliament on 3 October and would likely receive Royal Assent in mid-2014, with commencement thereafter.

70 Commission Interpretative Communication on the Community law applicable to contract awards not or not fully subject to the provisions of the Public Procurement Directives, Official Journal of the European Union, 2006 71 Regulation 47(7), Public Contracts (Scotland) Regulations 2012 72 Transposition Guidance – How to Implement EU Directives Effectively, HM Government, 2010 (this can be referred to but is not binding on devolved administrations) 73 Procurement Policy Note – Further Progress Update on the Modernisation of the EU Procurement Rules, Cabinet Office, 25 July 2013

EU PROCUREMENT DIRECTIVE

The revised EU public sector directive will see a number of significant changes to public procurement and, in particular, that the distinction between Part A and Part B services will be removed. There will remain a ‘light touch’ regime for particular categories of services, including legal, health and social services, with the requirement for OJEU advertising of contract notices (only award notices are required under current Part B processes) and a threshold of equal or greater to €750,000 established.

Other changes will include:

Compulsory e-procurement within 4.5 years of the directive’s adoption;

Wider SME participation, including encouragement of contracting authorities to split contracts into smaller lots and restricting any turnover requirements to twice the value of the contract;

Legal clarification that poor performance in previous contracts can result in exclusion, social as well as environmental factors can be considered in procurement, and that contracting authorities can consider the skills and qualifications of individuals (such as lawyers) at the award stage.

There is discretion to individual Member states around particular elements in transposing the directive. The abolition of the distinction between Part A and Part B services is mandatory, though there is discretion around the appropriate procedures for the “light touch” regime.

Article 76 of the new directive establishes the principles required for “light touch” procurement. Article 76(2) states:

“Member States shall ensure that contracting authorities may take into account the need to ensure quality, continuity, accessibility, affordability, availability and comprehensiveness of the services, the specific needs of different categories of users, including disadvantaged and vulnerable groups, the involvement and empowerment of users and innovation. Member States may also provide that the choice of the service provider shall be made on the basis of the most economically advantageous tender, taking into account quality and sustainability criteria for social services.”

The minimum requirement as a result of the new directive is that contracts are advertised in OJEU and that TFEU principles are adhered to, though the possibility of introducing elements of the current Part A requirements has been raised in a recent Cabinet Office discussion paper.

PROCUREMENT REFORM (SCOTLAND) BILL

A set of general duties on contracting authorities are established in the Bill. Alastair Merril, Director of Procurement and Commercial at SG, described the impact:

“The general duties are aimed at shifting the perception away from procurement as, in the words of one commentator, ‘a race to the bottom on price’, and looking to the broader economic benefits of spending decisions.” 74

The application of this Bill is to contracts above a threshold of £50,000 for goods and services and £2,000,000 for public works, therefore applying to a range of contracts that are below the 2012 regulations thresholds. A number of significant changes are introduced in this Bill, including:

Insofar as compatible with TFEU principles (restated in s8(1)), relevant and proportionate to the contract, for the contracting authority to comply with the sustainable procurement duty, requiring the promotion of “the economic, social, and environmental wellbeing” of the authority’s area, innovation and the involvement of SME, third sector and supported businesses;

For annual procurement of over £5m, to prepare and implement a procurement strategy and to report annually on progress in line with guidance from Scottish Ministers;

Contracts must be advertised and awards notified to the Public Contracts website, according to the requirements set in regulations;

For contracts above a £4m threshold, either a community benefit clause will be included in the contract or the reasons for not doing so will be specified in the contract advertisement;

Regulations may be introduced to introduce general requirements around the selection of tenderers, or their exclusion and the process for that exclusion and guidance may also be brought forward;

This is a significant extension of public procurement scope beyond the application of the EU Directives and the regulatory framework that transposes these. Remedies will be available for breach of the terms of this Bill, and according to the same time limits available for breach of existing regulations.

CASELAW

TENDER CRITERIA IN ENGLAND AND WALES

74 Procurement Reform (Scotland) Bill, Director’s Letter, October 2013, Scottish Government

The use of tender and award criteria has been considered in litigation raised by unsuccessful tenderers for legal aid contracts in England and Wales. The margin between success and failure in the tendering process has often been slim. The results may not always have created the optimal outcome for access to justice, for instance, creating monopoly provision in certain areas. However, the broad discretion available to a contracting authority and the necessity, having established the necessary criteria to follow these to their logical outcome, has been affirmed.

PARKER RHODES HICKMOTTS

In Parker Rhodes Hickmotts Solicitors v. Legal Services Commission, 75 the immigration and asylum tendering process started in November 2009 by the LSC was challenged. The tender awarded points for having a caseworker holding the LSEW Immigration and Asylum Accreditation Scheme (IAAS) Level 3 (5 points) or having applied to LSEW for such accreditation (1 point). This requirement for an accredited caseworker had not been mentioned in the pre-tender consultation process, but was raised first only in the Information for Applicants (IFA) for the tender.

The firm did not hold such accreditation, and did not apply for such accreditation until after the tendering process had closed. The firm missed receiving a full allocation of new matter starts by one point. Rather than receiving for the firm’s Rotherham office the 250 immigration and 800 asylum matter starts bid for, the office received 212 immigration and 145 matter starts.

The judgement cited the witness statement from the head of the firm’s immigration department:

"6. When the tender information was released on 30th November 2009, I was surprised to see that marks were awarded for having a Level 3 caseworker employed and that one mark was awarded for making an application to the Law Society for Level 3 accreditation. Although I was somewhat surprised, my initial reaction was that so few people were accredited at level 3, it would not have a bearing on the outcome of the tender. I knew that no practitioners in South Yorkshire or our procurement area were accredited at Level 3 and I therefore believed that our bid would not be affected by this.

7. I was also aware that the process for applying for Level 3 accreditation is quite lengthy and time consuming. It is not like other levels of accreditation and an applicant has to submit a detailed portfolio of material showing commitment and experience in this area of law. I was of the view that it would clearly not be possible for an application to be submitted and approved by the Law Society prior to the

75 [2011] EWHC 1323 (Admin)

tender deadline of 28th January 2010 so I knew there was no way providers could achieve top marks in the tender unless they already had a level 3 caseworker position.

8. With regard to the point which was awarded for simply making an application, I could not understand why this was being used as a criteria [sic]. It seems bizarre as it was clearly not a way to demonstrate quality provision of service. I believed that all providers would view this criteria in the same [way] as I did – irrational and unnecessary. For that reason, I made the decision not to apply for Level 3 at that time.

9. I had no idea that larger organisations would be able to rely on having a Level 3 caseworker employed in any office in the country to improve their bid in our area. Had I known that, it would have been obvious that this would affect our bid. It was not possible to rely on having a Supervisor employed in a different office, many miles from the office tendering for the work in our region, therefore I would never have imagined that the position with Level 3 caseworkers would be any different. The information in the Tender Information Form certainly seemed to suggest that each individual office would be judged separately."

McCombe J noted:

“[H]owever, three applicants for contracts in the South Yorkshire Access Point did make an application for Level 3 accreditation and received the appropriate acknowledgement to enable them to include that fact in their bids and thereby secure one tender point. These three organisations obtained 54 points in total in the tender assessments, including the one additional point for the Level 3 application. The claimant scored 53 points. The result was that the claimant's three rivals obtained allocation of their full NMS bids whereas the claimant received a much scaled down allocation. It appears further from the evidence that two of the organisations that achieved 54 points did not have a Level 3 accredited caseworker, or a caseworker who had applied for such accreditation, at their respective offices in South Yorkshire at the time of the tender deadline. It appears, therefore, that their extra point was achieved in each case in respect of a Level 3 accreditation application made in respect of a caseworker within the organisation, but based outside South Yorkshire.”

It may seem unduly harsh that a criterion not raised during pre-consultation could be determinative in the final outcome of the tendering process. Equally, in looking for quality of provision, it may seem “irrational and unnecessary” to award a point simply for the making of an application for accreditation (at worst, a firm with no prospect of demonstrating the quality standard required by accreditation but receive a point above a

firm that undoubtedly could but had not applied). However, it was held that such a requirement was not, in fact, unlawful:

“It seems to me that any person wishing to procure the supply of services is entitled to set quality criteria and to treat as less worthy any bidder who does not meet those criteria, even if those who would like to bid may not have the opportunity to qualify within the time frame of the tender process. Obviously, for example, it would be impossible for a person to complain that legal aid contract bidders should be required to have some legal qualifications at certain levels; it could not be said to be unfair that someone wholly without such qualifications could not obtain them in the tender period. It is not objectionable as such to require qualification at a particular level. Competitive tender processes assume that some candidates will be better qualified than others and will therefore attain higher scores. There is nothing inherently wrong with that. Nor is there anything wrong that a large number of persons cannot obtain the relevant qualifications within a tender period.”

The tendering process only required a an accredited caseworker working within the bidding organisation, whether that firm was applying for contracts on a national basis, or simply within South Yorkshire. This may not seem the optimal means by which quality could be promoted, but nor was it considered unlawful. For firms contemplating the prospect of criminal legal aid in Scotland, this is an important point to note: criteria could be introduced (and important to stress the potential for this rather than its eventuality) that not every prospective bidder could achieve by the time tenders were required.

McCombe J concluded:

“In human terms, the result is a sad one... The claimant has only itself to blame for not taking the simple step of putting itself in the position of getting the additional point for a Level 3 accreditation application; it thereby lost out to others who took this simple precaution. Equally, it is to be regretted that a firm obviously well equipped to deliver immigration and asylum law services is not able to work up to its full potential. However, this is a consequence of the structure of the bidding process with which it is not the court's place to interfere in the absence of illegality.”

ALLAN RUTHERFORD LLP

In Allan Rutherford LLP Solicitors v. Legal Services Commission, 76 an action for judicial review was brought after the firm failed to receive a contract to deliver social welfare law in Norwich. The tendering process was being conducted nationally, with 135 procurement areas, and in some of the larger procurement areas, these were designated into smaller ‘access points’ of which Norwich, Great Yarmouth, King’s Lynn and West Norfolk, and the

76 [2010] EWHC 3068 (Admin)

rest of Norfolk were the four access points for the procurement. For Norwich, 3,650 matter starts were available: 1,150 for debt; 1,000 for housing; and 1,500 for welfare benefits. The winning bidder, a consortium (CAB and Shelter) with 86 points, bid for all of these matter starts. As a result, there was no allocation available to any other bidders. Allan Rutherford LLP scored 80 points.

The firm argued that the tendering process was unlawful on a number of grounds, including that the requirement for experience of tribunal work was irrational and had not been raised in the consultation process on the tender; that the firm’s legitimate expectation that allocations would be awarded on the basis of size, experience and available competencies had been breached; and that it was irrational to develop a process that could award all matter starts to a single provider.

The criteria on which the tender process had been evaluated were challenged, and specifically the requirement, marked on a scale of 0-5 around “experience of delivering appeals to the Social Entitlement Chamber of the Upper Tribunal (Administrative Appeals) or First-tier Tribunal in relation to Social Security and Child Support”. This tender criterion had not been raised prior to the publication of the tender documents in 2010, leaving only the eight week tender window to make any necessary arrangements to demonstrate such competency. Ultimately, the firm scored 0 out of 5, having no solicitors engaged with such experience. However, the requirement to have experience reaching the Upper Tribunal in welfare benefit cases, according to analysis by the LSC, receiving the maximum of 5 points, was held by 82.8% of firms.

It was held that there was no statement or course of conduct undertaken by the contracting authority prior to the consultation period that engaged any legitimate expectation for the firm. Burnett J stated:

“There is in my judgment nothing arguably irrational in developing a criterion which is directed towards establishing the depth and breadth of the experience and expertise which a bidder is able to provide. Providing legal assistance to clients in this environment in connection with Tribunal work, rather than simply by engaging with the public authorities who administer benefits, is a reflection of both experience and expertise.”

Discussing the LSC analysis, Burnett J considered that it “suggests that a significant proportion of existing suppliers would, on the basis of past performance, be able to score the maximum available points and most, if not all, some points under this head. That said nothing of those who would be able to achieve a score, or enhanced score, by entering into a consortium agreement with another provider of legal services or by making arrangements to engage suitably qualified staff to augment the team from 14 October 2010. Both of those were options available to any bidder.”

As with Parker Rhodes Hickmotts, tender criteria may not be capable of being met by every prospective provider. The judgment of Burnett J does suggest that firms could look to meet criteria more effectively by either entering into a consortium with another bidder, or by looking to engage additional staff. It was recognised that it would be difficult for the firm to take either of these steps within the eight weeks available, and indeed that it had not looked to do so. A distinction was drawn between this tender and the family law tender challenged in Law Society of England and Wales v. Legal Services Commission, 77 considered below, which as Burnett J noted, “resulted in a wholesale culling of legal service providers in the family law arena”: in the Law Society case, an accreditation requirement had been imposed that had been both determinative in the final outcome and impossible to achieve within the tender window, that had been held arbitrary and unfair. In Allan Rutherford LLP, however, the criterion challenged related to the overall experience and expertise of the firm, which was considered a reasonable way to distinguish between providers; in the Law Society case, the previously unconfirmed requirement for dual accreditation artificially restricted the number of providers with experience and expertise who would otherwise have been able to succeed.

In Scotland, the informal dialogue events with the SLAB have considered, for instance, either that summary and sheriff and jury work could be contracted separately or jointly. A level of experience could be required that goes beyond that currently held by a number of existing providers. In terms of public procurement law, it would be possible for the first notice of these requirements to be the publication of the contract documentation. It is certainly not required for the tender criteria to be outlined in any previous consultation process, which, as Burnett J noted, would make the consultation process redundant. Firms in Scotland may need to consider whether to consider merger, joining into consortia or securing the staff (or by extension, resources) to ensure a successful bid.

On the point argued in Allan Rutherford LLP that it was irrational that all work had been allocated to a single provider, it was agreed in the judgment that a monopoly had been created (and, indeed, for the other three access points in the procurement area, the consortium had been successful and the only bidder). It was held that there were several factors that mitigated this monopoly, first, that this was a consortium involving two organisations, which would allow one or the other to deal with the conflict (while it was not explored in evidence, CAB advised that each of its offices operated separately, so no conflict of interest could arise) . Burnett J stated:

“Furthermore, although one consequence of the new scheme is to create local monopoly suppliers of publicly funded legal services in some areas with respect to this package, one of the underlying purposes of the new scheme was precisely to improve the range and quality of services available. In allocating all new matter

77 [2010] EWHC 2550 (Admin)

starts to the highest scoring bidder, the LSC was seeking to secure services for the public from the best qualified legal service provider.”

It was maintained that in conflict of interest cases, “a client could be referred to another legal service provider in an adjoining county, or to a national organisation.” This approach, though, has the prospect of increasing costs and reducing access to justice. Social welfare law deals with issues such as debt, housing and benefits for some of the most vulnerable citizens in our society. Placing conflict cases with a provider in another county or with a national organisation would burden citizens with the travel and other costs of accessing legal advice, as well as increase the costs to the legal aid system through increased travel and other costs. The duty on the LSC to ensure “that individuals have access to services that effectively meet their needs” 78 was not felt to be breached by the creation of such monopolies. The application for permission to apply for a judicial review was rejected. A monopoly on social welfare law in a city of the size of Norwich (roughly equivalent to that of Dundee) 79 may not be the ideal outcome of a tendering process but it remained the lawful outcome of a consistent and fair procurement process.

LAW SOCIETY OF ENGLAND AND WALES V LEGAL SERVICES COMMISSION

The tendering of family law services in 2010 saw a dramatic reduction in the number of legal aid providers, unforeseen by either the LSC or by the firms involved in the tender process. The outcome of the tender saw the number of offices providing family legal aid from 2,470 to 1,300, around a 46% reduction. This outcome saw widespread concern and criticism, as Beatson LJ observed in the judgment on the judicial review brought by LSEW:

“The reduction caused serious and vociferous concern. It was not just a question of numbers. It was not merely a question of dismay that those who had spent their professional lives for little reward providing publicly funded services to the deprived, socially disadvantaged and excluded were no longer to be permitted to do so. The focus of concern was that those who were acknowledged to be highly skilled and experienced professionals were no longer going to be able to deploy those skills in areas where they were most needed. That concern was expressed not merely by those who had failed, but by those who had succeeded, and by those who had come to know, trust and rely upon solicitors practising in a difficult and demanding jurisdiction, namely clients, minority representative organisations and judges.

Of course, any competition will throw up losers, will lead to change and cause concern. If that change is the consequence of a fair competitive process designed to lead to improvement in the provision of services by those most qualified to provide them, any complaint about the competition is likely to be unjustified.”

78 s4, Access to Justice Act 1999 79 Dundee has an estimated population of 145,570: Dundee Economic Profile, Dundee City Council, July 2012

The judicial review brought by LSEW was supported by 125 firms and had 45 witness statements in support. These included supporting statements from those successful under the process as well as those who were unsuccessful.

The family tender contained two particular features that gave it a ‘winner takes all’ approach. As outlined in the judgment, “It was, as Sarah Kovac Clark, Head of the Community Legal Service of the LSC (states in paragraph 56 of her statement) to identify the very best providers: firms which were good, but not rated as highly as the best would receive little or nothing.”

Specifically, in order to achieve a maximum score in the selection criteria, it was required at the stage of bidding to have a caseworker accredited under two different panel schemes, the LSEW Children Panel Accreditation Scheme and either the LSEW Family Law Accreditation Scheme (including the ‘violence in the home’ module) or be a Resolution Accredited Specialist in Domestic Abuse. In addition, the highest scoring bidder in each procurement area would receive the full allocation of ‘new matter starts’ up to a maximum of 200 per caseworker; if there was a tie amongst the highest scoring bidders, then matter starts would be allocated pro rata, in descending order of bidders until all matter starts for the procurement area had been exhausted. This structure for the tender saw two outcomes: first, that failing to achieve maximum points could significantly reduce the likelihood of receiving any matter starts (and without any, then no contract); second, the incentive to bid for as many matter starts as possible. The result, as Beatson LJ noted, was obvious:

“Many firms bid for very large numbers of New Matter Starts. There was a powerful incentive to do so. If a number of providers came equal first under the selection criteria, then the New Matter Starts would be allocated pro rata, as we have said, in accordance with the amount for which the provider had bid. Many providers overbid in hopes that on allocation they would be awarded a number of New Matter Starts closest to the number they sought. Thus the numbers of New Matter Starts bid for usually exceeded the number available, and the need to use the selection criteria was triggered. The LSC was alive to this possibility and put in place the system we have identified of measuring capacity.”

The central contention of the judicial review was that the LSC had acted irrationally in requiring dual accreditation. The aim of the tendering process had been to identify the “firms best equipped in knowledge, commitment and experience to provide family law services” and the requirement for a criterion that firms would not be able to demonstrate frustrated this aim.

Careful consideration was given in the judgment on whether the criteria for dual accreditation had been made clear prior to the opening of the tender. It was considered that it had not been clear and that, indeed, much of the information provided suggested the

contrary. Particular contrast was made to the accreditation requirement for supervisors, which was not required at the time of the bid, but at least six weeks before the contract start date. In upholding the application for judicial review, Beatson LJ said:

“LSC in its tender process was seeking to identify those best equipped to provide the services which were needed. That was the point of judging knowledge, commitment and experience by accreditation to the two specified panels. The application for accreditation shows, in the documents that we have seen, that it was a rigorous process, requiring external assessment of quality. The evidence shows that highly skilled and respected firms could have achieved such accreditation for a caseworker on both panels. It was irrational and contrary to LSC's avowed intentions to keep quiet about criteria according to which firms could demonstrate their expertise in priority services. It was irrational to announce that criteria at such a time when it was too late, by reason of the eight-week period, for bidders to acquire, not merely claim, accreditation on both panels.

We conclude that the failures we have identified to make clear what would be required to put a provider in the best position to acquire maximum points was unfair and arbitrary. It led to the absence of any opportunity to acquire an accreditation - an opportunity which ought in fairness to have been given to achieve the LSC's objectives.

The result was the LSC was unable to identify all those who could equally demonstrate their qualities by external assessment. The process arbitrarily distinguished, and unfairly distinguished, those who happened to have one caseworker on both panels or who had happened to have discerned what was necessary in the opaque and misleading information as we have found it to be.”

It had been suggested that joining a consortia or acquiring staff with appropriate qualifications had been an option available in Allan Rutherford LLP. This option was considered by Beatson LJ with some scepticism:

“[A]fter the terms of the tender had been announced, a firm without necessary accreditation could have hired a member of staff who did… That was not, as the evidence shows, a practical consideration for those with very low profit margins in the time available. Nor are we satisfied that such an approach gives effect to the LSC's intention to meet its obligations by identifying the best providers. Bearing in mind that maximum points could be acquired if one caseworker who, as it subsequently emerged after the close of tender, needed only to work for three and a half hours in any office in respect of which the bid was made, merely hiring one caseworker with membership of both panels would hardly establish the level of

experience, knowledge and commitment the LSC sought. It smacks of a somewhat cynical, although certainly commercial, approach.”

As Allan Rutherford LLP suggested, the accreditation criterion for the social welfare tender could be justified on the grounds of experience. It was the inability for family providers to demonstrate their experience through applying for accreditation that was determinate in the Law Society case.

Selection and award criteria need to be appropriate, relevant and proportionate. Criteria which cannot be justified risk being considered arbitrary and unfair. In upholding the judicial review of the family law tender, it was recognised that this would require retendering that would be expensive and time-consuming, as well as to the detriment of the around 1,300 offices that had succeeded in the tender process. The LSC’s aim in creating a ‘winner takes all’ system and including dual accreditation requirements had been to reward the most skilled providers and to ensure that there was expertise to deal with problem ‘clustering’, such as family and domestic abuse. The new matter start system exaggerated the outcome, and may not be an element of criminal legal aid contracting in Scotland. However, it is foreseeable that similar issues could occur with any contracting system that looked to significantly consolidate providers, unless the criteria are justifiable. The risk of unintended consequences cannot be underestimated.

TFEU PRINCIPLES

DEXTER MONTAGUE

The issue of transparency was considered by the Court of Appeal, Civil Division in the joined appeals in R (on the application of the Law Society) v Legal Services Commission and Dexter Montague & Partners (a firm) v Legal Services Commission. 80 These appeals involved judicial review of the new unified LSC contract for civil legal aid work. The new contract, running to 96 pages with a further 123 pages of specifications and rules governing all aspects of civil work (Part D), established certain quality assurance standards to be met and also the ratings required through the independent peer review process (involving a higher standard for the firm to be eligible for a contract extension or to bid for a new contract).

The contract provided that the LSC could from time to time amend any of the terms of the contract if it considered it necessary or desirable to do so to facilitate a reform of the legal aid system (the supplier only having the option to terminate the contract following such a unilateral change). It was argued that these terms breached the general provisions on public procurement law, the Parliament and Council Directive (EC) 2004/18 on the coordination of procedures for the award of public works contracts, public supply contracts and public

80 [2007] EWCA Civ 1264

service contracts and the Public Contracts Regulations 2006 81 which implemented that Directive. In particular, it was argued that the LSC had breached its obligations under Regulation 4(3):

“4(3) A contracting authority shall (in accordance with Article 2 of the Public Sector Directive)—

(a) treat economic operators equally and in a non-discriminatory way; and

(b) act in a transparent way.”

It was also argued that the Commission had breached its obligations under Regulation 9, a lengthy set of provisions on technical specification and which at Regulation 9(7) states:

“A contracting authority may define the technical specifications referred to in paragraph (5) in terms of performance or functional requirements (which may include environmental characteristics) provided that the requirements are sufficiently precise to allow an economic operator to determine the subject of the contract and a contracting authority to award the contract.”

All public procurement contracts are likely to contain terms regarding the amendment of their terms. However, The Law Society and Dexter Montague & Partners maintained that the wide-ranging and unilateral amendment powers of the LSC was not transparent according to Regulation 4(3) and could not offer the precision required for Regulation 9(7). In his judgment, Lord Philips of Worth Maltravers CJ maintained that the Commission was in breach and for these reasons:

“…the principle of transparency does not prevent a contracting authority from reserving a right to amend the terms of a contract. But if the contracting authority wishes to reserve such a right, not only must all those who may be interested in the contract be informed of that possibility, but they must also be informed of ‘the detailed rules’ governing its exercise… so that ‘the subject matter of [the] contract is clearly defined.“

Knowledge of the likely direction in which legal aid may be changed was also not deemed sufficient, the judgment stating, “Nor is it sufficient for the LSC to satisfy the obligation of transparency by reference to the knowledge of solicitors as to the general parameters of reform which may be likely in the future.” The fact that consultation was required before amendment was also not considered to satisfy the need for transparency. Ultimately, there is a need for both contracting authority and service provider to understand fully the subject matter of the contract.

81 (SI 2006/5)

The Dexter Montague case held that it would not be sufficient for a contracting authority to rely on providers’ knowledge of future reforms to ensure transparency. The outcome of this case, which LSEW became a party to, saw a deed of settlement agreed between LSC, MoJ and LSEW. A number of points were agreed, including: there would not be a further bidding round in 2008 (it had been suggested by LSC that all civil contracts would be terminated and retendered); current contracts would be extended until March 2010; providers that had lost or withdrawn from their contract could continue to provide legal aid for an additional two year transition period; a timetable for future reform, including the likely introduction of civil BVT by 2013, would be established; the parties would look to work together more constructively in future.

The risk highlighted by the Dexter Montague case centres around the flexibility of a contracting system. In Scotland, with the range of changes that have taken place since the first round of public expenditure cuts in 2010-11 have been significant, including the closure of 10 Sheriff Courts and 7 Justice of the Peace courts. The judgment in Cadder, the Criminal Procedure (Legal Assistance, Detention and Appeals) (Scotland) Act 2010, the introduction of a right of access to a solicitor to suspects at a police station, and the establishment of a police station duty scheme have seen significant changes to the way in which criminal legal aid operates.

‘The detailed rules’ required for a right of variation by the contracting authority might not foresee developments in the justice system, which would risk frustration of a legal aid contract. In response to the Dexter Montague judgement, the LSC indicated its intention to develop a revised amendment proposal, as reported in the Law Gazette:

“The LSC, [a spokesman] said, would be looking to develop an alternative amendment provision, which was not open to challenge. 'If this cannot be achieved, we will have no alternative but to terminate and re-tender for contracts much more frequently than in the past,' he added.” 82

It is not merely changes in legal aid reform and the justice system overall that may risk frustration of a contract. Business reorganisation within a firm may require a contract to either be novated or risk frustration. In England and Wales, under the current Unified Contract, contracted providers must notify LSC of any material constitutional changes as soon as practicable (or at a minimum, within 14 days), including moving from a sole principal to a partnership, a change involving more than a third of partners in a partnership or any change to partners in a LLP (Limited Liability Partnership), or any sale, merger or acquisition. It is usually at the discretion of LSC whether to novate the contract. For LSC, the

82 Society wins appeal against LSC contract, Law Gazette, 7 December 2007

broad policy is “the [new] arrangement must involve the same people delivering the same work in the same procurement area.” 83

As the LSC recognised in its response to the Dexter Montague judgment, a balance may be required between contract length and likelihood of significant change. The longer the contract, the more likely the risk of frustration through an unforeseen event, though equally, the greater the certainty to successful bidders; the shorter the contract, the converse.

HASTINGS & CO

The Accountant in Bankruptcy (AIB) outsources complex insolvency services to private firms, as Contract for Insolvency Services: Vision and Case for Procurement stated: 84

“In 2007, 62% (£6.4m) of AIB's total costs related to procured goods and services, and 69% of this procured spend (£4.4m) was concentrated in the highly complex area of Insolvency Practitioner services that undertake 62% of the Agency’s case work.”

One of the reasons for reviewing the procurement, as Contract for Insolvency Services noted, was that the existing contract had not been subject to market forces for 15 years. Though the legal framework for procurement does not set maximum terms for public contracts, a contract of such length, the AIB noted, “could fall foul of the underlying objective of the EU rules to open up public sector contracts to competition.”

Following the review of procurement, a tendering process opened on 18 September 2008 for a framework agreement from which services could be called down. A key aim of the procurement was to generate savings: £543,000 per annum, according to an interview in The Journal. 85 During the PQQ and tender stages, the AIB provided ‘supporting your bid’ events: an independent expert providing assistance to existing providers and prospective new entrants that had no prior experience of the public procurement process. Ultimately, five providers were successful: Armstrong Watson, Hastings & Co, MMG, KPMG, and Wylie & Bissett. 86 This was a dramatic reduction from the number of providers previous to the tender, numbering around 70 agents. 87

With the first contracts expiring in 2013, a further procurement process was run, with the contract notice with three lots 88 published in October 2012. By the conclusion of this

83 Legal Services Commission’s Standard Contracts 2010: Policy on novation of contracts in relation to Provider reorganisations, Legal Services Commission, February 2012 84 Contract for Insolvency Services: Vision and Case for Procurement, Accountant in Bankruptcy, June 2008 85 Bankruptcy Agency Chooses its New Help, The Journal, 31 March 2009 86 A sixth firm, Invocas, retired from the contract mid-term 87 Open Tender Raises Bankruptcy Fears, The Scotsman, 22 February 2008 88 Lot 1 for sequestrations taking place in the Aberdeen, Banff, Kirkwall, Lerwick, Peterhead, Stonehaven, Dingwall, Dornoch, Fort William, Inverness, Lochmaddy, Portree, Stornoway, Tain, Wick, Elgin, Alloa, Arbroath,

process, there had been a further reduction in the number of providers, reducing to three firms – Insolvency Support Services, KPMG and Wylie & Bisset - contracted under a framework agreement for an initial period of two years with two optional one year extensions. The financial outcome of the tender was positive, as Rosemary Winter-Scott said: 89

“It is excellent news that the new contract will release just over £1 million each year in direct savings to the public purse.

"The new arrangement allows the successful firms to benefit from economies of scale releasing efficiencies, improving the quality of service to the Agency’s customers and delivering best value for the public purse.”

A legal challenge was made to the procurement process in 2013 from Hastings & Co, 90 who had held a contract in the 2009 tender but had made an unsuccessful bid in the 2013 tender. The broad theme of the company’s challenge was that the tender process discriminated unlawfully against SME organisations. For instance, a question around service delivery in the ITT asked for an organisational structure, demonstrating management hierarchy and the key people providing the service, with CVs required for the named individuals managing the service. In response, Hastings & Co provided a table detailing the hierarchy, though not how line management responsibilities were structured, providing a CPD plan for one of its two insolvency practitioners, a training plan as an Annex and CVs for three staff. In a question on how providers meet the government’s objectives for sustainability, Hastings & Co responded with ten key initiatives, including reduction of paper waste, reducing travel and employing locally, and included an environmental policy and sustainability action plan.

For both of these questions, the pursuer received low scores. For service delivery, the defender considered the pursuer’s response lacking in detail, particularly around CPD arrangements, monitoring performance and staff appraisal. The organisational chart lacked the delineation of line management responsibilities, there was no skills matrix and only three CVs had been provided. For sustainability, there was again a perceived lack of detail, while other tenderers had provided details of initiatives such as “supporting youth employment through apprenticeships, school mentoring support and team-building charity events.”

Cupar, Dundee, Dunfermline, Falkirk, Forfar, Kikcaldy, Perth and Stirling Sheriff Court areas; lot 2 for Glasgow, Campbeltown, Dumbarton, Dunoon, Greenock, Oban, Paisley, Rothesay, Airdrie, Hamilton and Lanark Sheriff Court areas; and lot 3 for Ayr, Kircudbright, Stranraer, Dumfries, Kilmarnock, Duns, Edinburgh, Haddington, Jedburgh, Linlithgow, Peebles and Selkirk Sheriff Court areas 89 New Insolvency Services Contract Saves £1 Million Annually, press statement, Accountant in Bankruptcy, 22 April 2013

90 Hastings & Co v. Accountant in Bankruptcy [2013] CSOH 55

Provided that there is a sufficient link to the subject matter of the contract, criteria that favoured firms of a particular size were legitimate. Lord Hodge said:

“I am not persuaded that there is any basis for a general rule that an invitation to tender is invalidated because it is easier for larger enterprises to meet the tender requirements than SMEs. In Concordia Bus Finland Oy Ab v Helsingin Kaupunki [2003]3 CMLR 20 the contracting authority included in its assessment of the economically most advantageous tender criteria connected with the protection of the environment. The European Court held that that was consistent with the principle of equal treatment, even though only a few undertakings would be able to make an offer which would satisfy those criteria (the Advocate General at paras 91-93 and the Court at paras 59-64 and 85-86)…

But a contracting authority may risk breaching the equal treatment principle if it adopts criteria which are not sufficiently linked to the subject matter of the contract and which favour one type or size of economic operator over another. It will also do so if it takes into account in its scoring of tenders matters beyond the disclosed criteria that breach the principle of equal treatment.”

Moving to a consolidated market for insolvency services created savings for the AIB, increasing from over £500,000 following the first tender to £1m following the second tender. There had been a dramatic consolidation in the number of providers, though this did not seem to have unduly affected the service provided. There had been a challenge to the way in which the procurement of services has been evaluated, though the judgment in Hastings & Co did not accept the argument that the tendering process discriminated against SME providers.

AZAM & CO

The case of Azam & Co v. Legal Services Commission 91 considered the failure to submit a tender in time for the next bidding round for civil work and raised specific issues around equal treatment of economic operators. The argument made in the High Court of Justice (Chancery Division) was that Mr Azam, a sole practitioner, was only made aware of the tendering process on 4 February 2010, by which stage the bidding had closed. Mr Azam had contacted LSC, who refused to provide an extension to the process. Briggs J described the consequences for the firm if the judgment was not in the plaintiff’s favour:

“If the firm obtains no relief in these proceedings, it will later this year cease to be able to carry out publicly funded immigration work (save possibly in a very restricted field), with financial and professional consequences both for Mr Azam himself, and

91 [2010] EWHC 960 (Ch)

for his employed staff, which include other solicitors qualified in the same field, which may fairly be described as disastrous.”

The tendering process had been advertised on the LSC website and by LSEW in the Gazette. The firm had also received a mailshot from LSC that advised that new tendering would start but “did not expressly identify the deadline for submission of tenders, either for immigration and asylum work, or at all.”

It was argued that, first, there was no direct communication to the firm of the deadline for the tendering process in breach of the LSC’s duties of equal treatment and transparency, breach of a legitimate expectation that the firm would be directly notified of the tender deadline and breach of the principles of good administration. Second, that the LSC breached its duty to the principle of proportionality, in failing to provide an extension to the deadline, in light of the “disastrous” financial damage to the firm and a failure by the LSC in directly notifying the firm.

Regarding a direct communication to the firm, it was held that a reasonably careful and diligent provider would have investigated a letter from the LSC that notified of a tender process, though not the deadline:

“[V]iewed from the perspective of a reasonably careful and diligent existing supplier, that… [mailshot] contained all the information reasonably required to enable the recipient to participate in the tender process. It notified that there was an immigration tender up and running, that it had a deadline which need to be complied with, and that the relevant terms and conditions (including by necessary implication the deadline) could be found by a simple process which started with accessing the LSC 's website and following a small number of specified prompts.”

It was recognised that a week’s extension of the deadline for submission would not have a significant effect on the overall procurement process:

“[A] refusal to extend the deadline would visit harsh economic consequences on the firm, and that a week's extension would not, in the sense of depriving any other applicants of immigration work to which they ought in fairness to be entitled, cause any prejudice of that kind. On the contrary, it appears that publicly funded immigration work could, even now, be made available to the firm were it to succeed in these proceedings, without de-railing the process in any significant respect.”

However, it was considered that allowing this firm an extension would prejudice the interests of other bidders. Briggs J reasoned, “It would be likely to be regarded as unfair by tenderers who would have wished for longer time in which to perfect their tenders, but who nonetheless completed them on time and, in reliance on the warning that extensions would not be granted, sought no further time for themselves.”

In these circumstances, while there was sympathy for the firm, public procurement rules required judgement in favour of LSC:

“I am compelled to dismiss its claim, but not without considerable sympathy for Mr Azam and his staff. The firm faces the loss of the bulk of its work not as the result of any failure carefully and diligently to protect the interests of its clients, but because of a failure to take proper care in the furtherance and protection of its own interests. It is unfortunately inherent in the principles of EC law sought to be enforced in this case that those principles assist those who act with reasonable care and diligence about their own business affairs, and not otherwise.”

These issues were heard on appeal from the plaintiff by the Court of Appeal (Civil Division) and dismissed. 92

JR SOLICITORS

Mistake was also at issue in JR Solicitors v. Legal Services Commission 93 where a firm submitting an electronic tender answered, “The applicant organisation has delivered immigration services and advised clients in at least 35 cases in the immigration category of law since December 2008,” which scored five points in the overall assessment.

The firm did not select an alternative response, that the organisation had delivered services and advised clients in at least 35 cases, including representing at least one client before the Asylum and Immigration Tribunal, which the firm had done and which would have scored eight points. As a result, the firm scored 50 points, and any organisation with 51 points or less was not awarded a contract. As a result of this mistake, the tender was unsuccessful. Purle J said, “That is a sadly regrettable outcome, but I do not think the LSC can be criticised for having applied the conditions of the tender.”

The rules for public procurement offer little protection to rectify any mistake in the tendering process. Reopening a closed bidding in order to do so would be unfair to those bidders that did comply with the rules and provide correct information. A mistake noticed after submission but before the tender closed, though, would likely be possible to change as would the ability to make corrections after the closing date available to every actual or prospective bidder.

There have been a number of instances of firms making mistakes during the tendering process and being excluded from legal aid as a result. Court actions in England and Wales have offered little respite to such providers. Mistakes in the bidding process led the LSC to

92 Azam & Co v. Legal Services Commission, [2010] EWCA Civ 1194 93 [2010] EWHC 3671 (Ch)

undertake an additional tendering round for the most recent family law tender, as Sir Bill Callaghan, the LSC Chairman, said in a speech to the Liverpool Law Society: 94

“[S]ome issues were raised about providers who were unsuccessful because they made mistakes in their tenders. The LSC had previously communicated that, to ensure equality of treatment for all applicants, they would be unable to intervene in the tender process, to point out to providers, or correct, any errors they may have made. It was therefore disappointing to see these errors being made.

The LSC was in agreement with The Law Society and other representative bodies that it would be preferable to find a constructive and pragmatic way forward… So we will be running a further tender process for licence only family and family and housing contracts.

This will give providers who were previously unsuccessful the opportunity to continue to undertake publicly funded family work while considering their longer term plans…”

It may be that a similarly pragmatic approach could be adopted in Scotland. One of the areas in which the new procurement directive allows discretion in transposition is around the rectification of mistake, allowing for contracting authorities to “submit, supplement, clarify or complete information or documentation which is incomplete, erroneous or missing”. 95 In the absence of such change, however, it will be imperative for firms planning on bidding should criminal legal aid contracting be introduced to ensure that they take due care and protect their own interests.

CONCLUSIONS

Introducing contracting would bring legal aid within the scope of the public procurement framework. This is not a novel area of law or practice, but rather a mechanism used for procuring around £8bn of works, goods and services annually.

CHANGING PROCUREMENT LANDSCAPE

There are changes to the way in which procurement operates ahead. The Procurement Reform (Scotland) Bill restates the focus around sustainable procurement, ensuring that where relevant and proportionate, the economic, social and environmental wellbeing of the contract area are considered. Indeed, for large procurements, the need to consider whether to include a specific community benefit term into public contracts will also be required. The new EU procurement directive may also see changes to the way in which procurements for Part B services are conducted, though the new arrangements will remain “light touch”.

94 The Future of Legal Aid, Sir Bill Callaghan, 8 February 2012 95 Procurement Policy Note – Further Progress Update on the Modernisation of the EU Procurement Rules, Cabinet Office, 25 July 2013

CONTRACT CRITERIA

The contract criteria for any system of contracting have yet to be determined. As a matter of principle, though, any criteria used to distinguish between providers on the basis of expertise, experience or capacity would, if relevant, proportionate and justifiable, be permitted. The issues emerging from the family law tender process in England and Wales centred on accreditation, a standard that could not be met within the time available and which the court considered unfair and arbitrary. However, in the social welfare tenders it was held that specific criteria around Upper Tribunal work were justified as a way to distinguish experience of providers. The contract criteria do not need to be publicised in advance of a tender window opening, though if there is previous indication around terms, there would likely be a legitimate expectation that these are included in the procurement process. The criteria selected do not need to be achievable by any prospective or current provider, instead simply that they are relevant, proportionate and achieve the objective of securing the best providers. The Parker Rhodes Hickmotts case shows that difficult decisions – consortium, merger, recruitment – may need to be taken at short notice. In that case, decisions on how to secure the appropriate expertise needed to be taken within the eight week tender window; a difficult, though not unachievable task.

MISTAKE

The principle of equal treatment requires a level playing field between different economic operators. This does create a procurement environment in which compliance with the terms of the process are critical. For instance, late submissions or uncorrected mistakes could see firms that may be competent and capable of performing a contract instead being excluded from the marketplace. If contracting is introduced, understanding the procurement process, following the instructions detailed in the process, being comprehensive in responses to PQQ, ITT or equivalents. Criteria do not need to be achievable for every existing provider, and indeed no advance notice is required of the terms required: firms might need to consider how to secure the expertise and capacity to meet the criteria for contracts, such as through merger, staff recruitment or other steps.

Perfect competition

• Large number of small scale providers • Identical goods or services • No barriers to market entry • Perfect knowledge of market

Legal aid as a monopsonic market

• No intrinsic challenge to competitive market • Ability to reduce price or volume not a sustainable option

Preventing uneconomic bids

• Prevalent practice in certain sectors • Range of ways to mitigate risk, including supplier support, clear contract information and not awarding on basis of lowest price

Competitive neutrality

• Mixed markets require 'level playing field' between private, public and third sector providers • Scheme for contracting likely requiring neutrality between traditional firms and ABS

Competiton law

• Collective action with an anti-competitive effect unlawful • Application to any participant or collective of participants in market

CHAPTER THREE – CONTRACTING, MARKETS AND COMPETITION

Legal aid contracting may introduce structural competition to the criminal legal aid marketplace. While there exists competition for clients between firms currently, often fierce, in terms of quality of service, reputation of firm, and outcome achieved for clients, there is no competition within the structure for provision: there is no competition to become registered to provide criminal legal aid, simply all that can satisfy the requirements for registration are registered; and there is no competition on price, with the feeing structure set by regulations rather than through any bidding process. As seen in the previous chapter, many public procurements of works, goods and services see competition on a quality and price basis. The models outlined by the SLAB in the dialogue events, and in The Context for Legal Aid paper do not all require competition on either basis, though some do, either restricting the number of available contracts or seeing bidding on price.

This chapter will consider the structure of competitive markets, to understand how these operate and some of the challenges that are faced in ensuring optimal outcomes for the purchaser and the suppliers of services. The system for legal aid contracting is not a typical market, in that the SLAB is the purchaser of services, though not the user of these services; also it is a largely monopsonic purchaser (a monopsony the inverse of a monopoly, the latter a market with only a single seller of goods or services). As criminal defence work is almost wholly dependent on public funding, the market viability of many firms will depend on successfully tendering for a legal aid contract. That criminal legal aid is a monopsonic market is unobjectionable: there are many monopsonic markets, healthcare across the United Kingdom a paradigmatic example. The structure of such markets, though, may create particular outcomes that will need to be accommodated in any contracting system.

Behaviour in competitive markets will be considered, particularly how bidders behave. Discussions around price competition and criminal legal aid in England and Wales have raised the challenge of ‘suicide bidding’, or successfully securing a contract at an economically unviable rate. This is frequently reported in other business sectors and understanding some of the mitigations that can reduce that risk, for instance, better supplier support and management or sanctions for non-performance of work agreed in the bidding process. Fair competition, overall, is necessary for the efficient allocation of resources and effective competition. Competitive neutrality from the buyer of services in mixed markets of public and private provision, which legal aid is, will be important. There are also obligations on the suppliers in a market to behave fairly and to compete effectively: competition law prohibits anti-competitive agreements, cartels or abuse of a dominant market position. While competition law concerns are rare in most markets, an understanding of the parameters of fair behaviour in a competitive market can assist.

PERFECT COMPETITION

It is axiomatic that the way in which resources are efficiently allocated in a marketplace is through competition. The ideal of a competitive market, in which resources are allocated most efficiently, is one in which the actions of no individual buyer or seller have an effect on the market overall. These types of market are in states of perfect competition.

There are a number of factors, of which four are key:

A large number of small firms;

Identical goods or services sold by all firms;

No barriers to market entry;

Perfect knowledge of market.

This creates a market in which no single provider can exercise influence over the market. As there are a large number of firms, a buyer of goods could seek an alternative vendor if a firm was to raise its price. As the number of firms is large and the size of firms is small, no one firm can take effective unilateral action. As the goods or services are identical, they are substitutable and there is no incentive for a buyer to select a particular firm. Having no barriers to market entry means that there are no significant barriers to entering competition, though for legal aid, some do exist: for instance, there is the requirement for solicitors to have completed a qualifying degree, to have undertaken the diploma and to have been admitted to the roll of solicitors, a significant investment in time and resource. Perfect knowledge of the market means that buyers and sellers are aware of market behaviour: a price above normal profits, for instance, would be immediately obvious to a buyer who would choose to purchase with a cheaper seller.

Though perfectly competitive markets are largely an ideal, there are practical examples. For instance, bookmakers at a race-course, where any individual firm looking to raise prices would be unable to raise prices significantly as it would be immediately obvious to buyers that the price was disadvantageous. A stock exchange may also be an example of perfect competition, though large institutional investors may be able to influence a market because of their overall size. Outlining this particular model of competition in markets is useful, as it allows contrast with some of the idiosyncratic features of the criminal legal aid marketplace, including a monopsonic buyer and a mixed market for provision.

MONOPSONY

Markets exhibiting the characteristics of perfect competition are rare as, in many markets, the action of one buyer or seller can influence market conditions. The most prominent

examples of these are markets with a single buyer – a monopsony – or a single seller – a monopoly. In such situations, either the monpsonist or the monopolist can set prices or volumes without fear of being outbid by a competing seller or buyer respectively. A monopsonist could, for instance, set price and volume below that in a competitive market. This would not be an efficient distribution of resources, resulting in what is known as a deadweight loss: if the price were higher, more services could be provided by the sellers. A monopsonist could, indeed, set prices or volumes below the rate at which firms could achieve a profit. 96

However, the sellers in a market also have market power. If prices or volumes were set at rates which were reduced or even uneconomic by a monopsonist, the number of new entrants to the market may reduce, as there is no return available on the costs of entry, or the number of existing providers may reduce, as firms either find it increasingly financially viable to invest in diversification or increasingly uneconomic to continue and exit the market or, as a possible risk, providers either suicide bid or cut corners with the quality of their provision.

In considering proposals for Best Value Tendering, LECG, on behalf of the Law Society of England and Wales (LSEW), examined the monopsonic status of the legal aid marketplace in England and Wales. 97 Though the risk that the Legal Services Commission could set prices or volumes at monopsonic rates, setting uneconomic conditions could only be a “short term ploy”: the market would ultimately reach an equilibrium at which fewer services were provided for the lower cost set. Ultimately, LECG found that there was no structural challenge to a monopsonic market. However, a number of factors to ensure a sustainable and competitive market were noted, including sufficiency of providers, low costs to market entry, equal access to information and resources and, in particular, accepting the prices generated through market competition, which may increase in some areas and decrease in others.

It can also be argued that the market for criminal legal aid services is not a properly monopsonic market. The SLAB may be the single payer of legal aid services, but, in markets that retain client choice, providers also compete with each other to win clients as well as any legal aid contract from the Board. The presence of client choice, it can be argued, limits the amount of market influence that a purchaser could exert.

The LECG report, moreover, suggests that there may even be benefits to monopsonic markets:

“There are positive aspects of having a single purchaser. The single government purchaser provides stable and predictable demand for services, which if managed

96 Monopsony in Law and Economics, Roger D. Blair and Jeffrey L. Harrison, 2010 97 Single Purchaser Market: The Procurement of Criminal Defence Services (CDS), LECG, 2006

effectively by the government provides a good basis on which firms can plan their business. This may be compared with some highly competitive markets (from high technology to agriculture) in which demand and prices fluctuate excessively and make planning hard.”

The use of buying boards in particular sectors is raised as an example of this approach, such as the Milk Marketing Boards in Scotland and in England and Wales, which prior to market deregulation had the statutory right to purchase all milk sold wholesale. The advantages argued for these Boards was that the market had a guaranteed buyer, periodic payments and a pre-determined price that promoted certainty and avoided market volatility.

COMPETITIVE NEUTRALITY

Public bodies are monopsonists in many of the markets in which they buy goods and services. In mixed marketplaces, where public and private provision co-exists, it is important to ensure that the marketplace is fair, as the OFT outlines in Government in Markets: 98

“Where public sector bodies are engaged in mixed markets alongside private firms, it is important for the public bodies to ensure that they are not exploiting unfair advantages over the private sector and stifling innovation or improved efficiency that private firms may bring to the market.”

Public procurement requires contracting authorities to treat economic operators equally and, similarly, effective market competition requires the same. Criminal legal aid is currently provided by both PDSO as a public provider and traditional private practice firms. The procurement of criminal legal aid contracting would likely need to be open to ABS organisations and possibly also other entities, such as in-house legal teams or not-for-profit organisations. In the United States, for instance, indigent defence contracts have been awarded to the not-for-profit sector, and in England and Wales, not-for-profit organisations have provided a significant proportion of civil legal aid over the last fifteen years.

Guidance from the Office of Fair Trading, Competition in Mixed Markets: Ensuring Competitive Neutrality, 99 outlines the need for competitive neutrality – a ‘level playing field’ – in mixed markets of private, public and not-for-profit provision. The OFT holds that competitive neutrality, in so far as practicable, allows for efficient allocation of resources in a market, reduced costs and better value for taxpayers. While public service markets opened up to private sector or not-for-profit involvement may have seen a focus on eliminating any disadvantage to these new entrants, ensuring that public sector provision is not at a disadvantage is also key.

98 Government in Markets: Why Competition Matters – a Guide For Policy Makers, Office of Fair Trading, 2009 99 Competition in Mixed Markets: Ensuring Competitive Neutrality, Office of Fair Trading, July 2010

The aim of competitive neutrality is not to remove competitive advantage, where an organisation has a unique advantage in a marketplace, whether better access to capital, a lower cost base, or a superior product or services. Competitive neutrality deals with differences in costs, quality and other factors that derive solely from an organisation’s ownership or control.

A contracting system could not require PDSO to bid, as it is not a discrete legal entity separate from the SLAB. PDSO provision would instead co-exist alongside a contracted system. However, the contracting system would need to consider ways in which competitive neutrality could be achieved in the market, for instance, ensuring that a mixed market can exist and having a ‘level playing field’ between public, private and third sector providers, including traditional firms and ABS organisations.

SUICIDE BIDDING

Firms may not always bid at a level broadly related to the value or cost of the contract. A low price may be offered as a loss leader, from a firm’s misapprehension about the overall value or cost of the contract or as a suicide bid. The last of these is a deliberately uneconomic bid designed to secure the contract, protecting cashflow at the expense of profit. The risk of suicide bidding is that successful bidders in these circumstances either significantly reduce the quality of service provided or become economically unviable as firms as the contract progresses. Though this does not apply to Part B services, a bid in other public procurements can be rejected for being “abnormally low” 100 and this has been considered in litigation. 101

In certain sectors, reports of suicide bidding are numerous. In June 2013, the Construction Enquirer reported on a survey of quantity surveyors conducted by the Royal Institute of Chartered Surveyors (RICS). 102 The survey suggested that around 20% of tenders submitted in 2010 and 2011 had been submitted at a sub-economic level; most such bids were priced at around 10% below cost, but in extreme cases, at up to 40% below cost. Two thirds of quantity surveyors had advised clients not to accept bids because they were too low to be viable and 78% believed that the problem of suicide bidding would increase in the next twelve months.

The Civil Engineering Contractors Association (CECA) has suggested ten steps to reduce the risk in this sector. 103 The steps suggested include:

Blocking ‘suicidal bidding’ through a move away from price-based contracting;

100 Regulation 30(6), Public Contracts (Scotland) Regulations 2012 101 Amey AG v. Scottish Ministers [2012] CSOH 181 102 Suicide Bids Coming in 40% Below Cost, Construction Enquirer, 21 June 2013 103 Ten Steps to Smarter Procurement, Civil Engineering Contractors Association, April 2013

Increase early contractor involvement;

Limit tender list sizes – in the construction sector, the number of providers admitted to tender lists has been increasing, which has seen increased costs in submitting tenders and also reduced chance of success;

Improve the quality of tender documentation – as incomplete or inaccurate tender documentation can create risk for providers, including claims around delivery to specification;

Fairer inflation risk management – the effect of inflation on contracts is met by the provider and the use of standard indices can help to produce consistency.

If a contracting system is introduced and designed as competitive, there may need to consideration of similar steps. Many of the steps taken to reduce the risk of suicide bidding would also help to ensure that providers do not mistake or misapprehend the value or cost of any contract bid. Early engagement with providers and detailed tender documentation, for instance, would assist effective and informed bidding. In its consultation on Best Value Tendering in 2009, a policy abandoned without implementation, the Legal Services Commission specifically addressed the risk of suicide bidding. 104 Supporting bidders was a key element of the mitigation against this risk, for instance, through supplier support activities and an area prospectus with detailed information on each area in which interested firms may bid. The ability to revise bids during the tendering process was also considered as an option, along with sanction for non-performance, and the ability to continue to provide legal aid at the Magistrates’ Court even if unsuccessful.

COMPETITION LAW

A further risk that competitive markets face, though relatively rare in practice, is around anti-competitive behaviour. This is prohibited in the United Kingdom under Chapters I and II of the Competition Act 1998.

Chapter I of the Act prohibits agreements which prevent, distort or restrict competition in a market, for instance, by fixing prices or volumes, price discrimination (where different prices for the same goods or services are charged to different buyers) or agreeing concerted action in a marketplace. Agreements can be formal or informal, in writing or verbal. Cartel agreements are a more serious form of anti-competitive behaviour and can be subject to criminal sanction. A cartel is formed when undertakings in a marketplace reach agreement not to compete on price. Cartel behaviour is often informally agreed, though there can be a

104 Best Value Tendering for CDS Contracts 2010, Legal Services Commission, March 2009

number or proxy indicators, for instance, firms in a market operating with very similar pricing structures, or raising prices by around the same amount at around the same time.

Chapter II of the Act prevents undertakings in a market from abusing a dominant position, a situation in which the undertaking can generally act independently of the market. Abusing such a position could involve charging excessive prices, reducing volume, price discrimination and the like.

Firms are subject to competition law as ‘undertakings’, and by extension, local faculties and indeed LSS are subject to the same, as associations of undertakings. The OFT guidance on trade associations states: 105

“The term used in both Article 81 and the Chapter I prohibition is an association of undertakings. Any body formed to represent the interests of its members in commercial matters may be an association of undertakings. An association of undertakings is deemed to represent the interests of those undertakings which have chosen to join, and it is therefore irrelevant how the association is organised. It is not necessary for it to have any formal constitution for its activities to fall within the scope of Article 81 and/or the Chapter I prohibition. An association of undertakings will fall within Article 81and/or the Chapter I prohibition if its decisions, rules, recommendations or other activities lead to an appreciable restriction of competition, regardless of the exact form that the association takes.”

The consequences of anti-competitive behaviour prohibited by the Act can be severe. Fines can be levied up to 10% of turnover, third parties affected by the anti-competitive behaviour can bring actions for damages, and in cases involving cartels, there can be criminal sanction or directorial disqualification. Most small businesses are exempt from the fines levied, though the other consequences of anti-competitive behaviour remain.

If contracting is introduced, firms competing in a legal aid marketplace would need to understand the broad impact of competition law. It would not be possible for LSS or for a local faculty to suggest a bidding price or particular types of collective action in a marketplace. Some care may also need to be taken in discussing any of the competitive elements of a procurement exercise with any other (actual or prospective) participants. The OFT has guidance for businesses on competition law requirements on its website. 106

CONCLUSIONS

The marketplace for criminal legal aid is idiosyncratic in many ways. There is competition for work, though not on price, which is set centrally. It is a single payer market, where the buyer

105 Trade Associations, Professions and Self-Regulating Bodies, Office of Fair Trading, December 2004 106 (http://www.oft.gov.uk/OFTwork/competition-act-and-cartels/competition-law-compliance/guidance-for- businesses/), last accessed 1 November 2013

is paying for services on behalf of third parties, the members of the public eligible for criminal legal aid. And it is a monopsonic market, with a single buyer and multiple providers.

MONOPSONY NOT INTRINSIC BARRIER TO COMPETITION

In many ways, the market for legal aid is distant from the ideal of perfect competition. However, the fact of a single buyer of services does not necessarily make the marketplace for criminal legal aid uncompetitive. Buyer reduction of prices or volume is likely to see seller responses, either reducing the number of new entrants to the market and existing providers investing to diversify or exiting the marketplace. It can be argued that a monopsonic purchaser offers some protection for sellers in a market, such as with buying boards that provided market certainty and security.

RISK OF SUICIDE BIDDING

Downward pressure on prices can create the risk of suicide bidding, where firms secure ongoing cashflow at the cost of future profit. Such bids can threaten the economic viability of the firm involved, or the quality and quantity of the goods and services provided. There are some ways to mitigate against this risk, for instance, adequate information to providers on the terms of the contract, ensuring that contracts are not let for lowest price or sanction for failing to meet performance criteria.

COMPETITIVE NEUTRALITY

Procurement law requires equal treatment of economic operators and, similarly, effective competition in mixed markets requires competitive neutrality, a ‘level playing field’ between providers, irrespective of their ownership. PDSO provision for criminal legal aid, or CLAO provision in a civil context, would not be subject to contracting. Indeed, it could not be subject to contracting. PDSO solicitors are SLAB staff members and part of the same legal entity: it would not be possible to bid for or hold a contract. However, for the organisations involved in the procurement process, there will need to be competitive neutrality: possible bidders may come from the public sector, however unlikely, or from the third sector, as has occurred in other jurisdictions, or from the private sector. In the private sector, there will likely need to be neutrality between traditional firms and ABS organisations.

REFERENCES

BIBLIOGRAPHY

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CITATIONS

LEGISLATION

Access to Justice Act 1999

Equality Act 2010

Equality Act 2010 (Specific Duties) (Scotland) Regulations 2012

Procurement Reform (Scotland) Bill

Public Contracts (Scotland) Regulations 2012

CASES

Alcatel Austria v Bundesministerium fuer Wissenschaft und Verkehr, Case C-81/98 [2005]

Allan Rutherford LLP Solicitors v. Legal Services Commission [2010] EWHC 3068 (Admin)

Amey AG v. Scottish Ministers [2012] CSOH 181

Azam & Co v. Legal Services Commission [2010] EWHC 960 (Ch)

Bent Mousten Vestergaard v Spøttrup Boligselskab [2001] Case C-59/00

JR Solicitors v. Legal Services Commission [2010] EWHC 3671 (Ch)

Law Society of England and Wales v. Legal Services Commission [2010] EWHC 2550 (Admin)

Parker Rhodes Hickmotts Solicitors v. Legal Services Commission [2011] EWHC 1323 (Admin)

Pieretti v Enfield LBC [2010] EWCA Civ 1104

Public Interest Lawyers v. Legal Services Commission [2010] EWHC 3277 (Admin)

R (Brown) v. Department of Work and Pensions [2008] EWHC 3158 (Admin)

R (Capenhurst) v Leicester City Council [2004] EWHC 2124 (Admin)

R (Fawcett Society) v Chancellor of the Exchequer [2010] EWHC 3522 (Admin)

R (Luton Borough Council) v. Secretary of State for Education [2011] EWHC 217 (Admin)

R (Law Society) v Legal Services Commission and Dexter Montague & Partners (a firm) v Legal Services Commission [2007] EWCA Civ 1264

R (Williams) v Surrey County Council [2012] EWHC 867 (QB)

Telaustria Verlags GmbH and Telefonadress GmbH v Telekom Austria AG [2000] Case C- 324/98