Legal quango rebuked for poor financial management

1 Feb 10
The Legal Services Commission has come under fire from a committee of MPs for poor financial management
By Lucy Phillips

2 February 2010

The Legal Services Commission has come under fire from a committee of MPs for poor financial management.

A report by the Public Accounts Committee, published today, condems the quango for ‘poor financial management and internal controls and deficient management information’. The non-departmental body is responsible for buying civil and criminal legal aid from barristers and solicitors in England and Wales.

PAC chair Edward Leigh said: ‘The Legal Services Commission has been doing a far from competent job of buying legal aid from lawyers. It spends large amounts of money – more than £2bn in 2008/09 – but its financial controls and management information have been lax.’

The commission’s weaknesses in financial management resulted in solicitors being overpaid by £25m in 2008/09, for which its accounts were qualified by auditors, the PAC reports.

The group of MPs also criticises the ‘muddled’ relationship between the commission and its sponsoring department, the Ministry of Justice, which spends £2m a year overseeing legal aid procurement. ‘We found confusion and uncertainty about the respective roles of the two organisations, which had led to the duplication of effort on some issues and a lack of clarity about who should be responsible for others,’ says the report.

The commission is also slammed for its failure to plan and evaluate reform to legal services.  Proposals to introduce price competition across the sector were recently abandoned because of opposition from legal professionals.

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