Legal aid purchasing under fire

1 December 2009

1 December 2009 | Allie Anderson

Procurement practices at the UK Legal Services Commission (LSC) are putting value for money “at risk”, according to the National Audit Office (NAO).
A report by the public spending watchdog last week found the LSC’s £1.1 billion annual spend on criminal legal aid – assistance for people suspected of or charged with a criminal offence – is not being used effectively.
In particular, gaps in knowledge about its supplier base prevent it from being able to improve efficiency, quality of service provision and control costs.
The LSC, a Ministry of Justice agency, has a good understanding of legal aid providers on a local level, the report said, but it fails to draw this information together centrally.

It therefore does not have a “firm grasp” of the cost structures of legal aid suppliers and how these vary depending on where they are based, making it difficult to assess whether it is paying a fair price.
The government plans to move towards a best value tendering system for the procurement of criminal legal aid, under which prices would be determined by supplier competition.

As a result of this, the LSC insists it does not need to hold detailed information about suppliers. But the report said the LSC’s failure to properly use vendor data would put the implementation of competitive tendering at risk.
Amyas Morse, head of the NAO, said in a statement: “It is very important that the commission understands the market from which it is buying and the cost effectiveness of its own practices, but at present, that is not the case.
“It needs to address this as a priority to make sure it is paying a fair price for legal aid services that both sustains a competitive supplier base and provides value for money.”

The NAO recommended that the LSC collate and analyse the supplier information it already holds locally, while also conducting further research on its vendor base.

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