Criminal Defence Service Bill [HL]

My Lords, I beg to move that this Bill be now read a second time. The Bill is designed to make the criminal legal aid system fairer and more efficient both by transferring responsibility for the grant of representation and by introducing a new system of means testing for criminal cases. Before I speak in any great detail about the proposals we have before us today, it may assist the House if I briefly place the Bill into some historical context. Your Lordships will be aware that proposals for a system of legal aid were first advanced by the Rushcliffe Report in 1945. They were enacted in the Legal Aid and Advice Act of 1949. The founding principles of legal aid were simple. In a time of historic welfare reform that saw the birth of both the National Health Service and the modern welfare state, it was decided that a ““judicare system”” should be established whereby lawyers would cater for the needs of the poor as well as the wealthy. The system would guarantee that the poor would be able to receive legal advice and representation so as to prosecute and   defend their legal rights and to ensure that they would achieve equality in doing so. Both counsel and solicitors would, at the same time, benefit from fair remuneration for their services. The Access to Justice Act of 1999 delivered a range of reforms. It created the Legal Services Commission to replace the old Legal Aid Board. It established the Community Legal Service better to focus resources on priority family and social welfare matters and help to take great strides in tackling social exclusion. It also created the Criminal Defence Service to replace the old criminal legal aid arrangements. Within that framework, the Government have continued to introduce other innovative measures aimed at improving the performance and cost-effectiveness of legal aid. But throughout its history—the 1960s, 70s, 80s   and 90s—the cost of providing legal aid rose exponentially. Expenditure this year (2004–05) is expected to reach £2,036 million. That is £511 million more than in 1997–98 and represents an increase of some 34 per cent at a time when inflation was running at a mere 1.3 per cent. I am sure that we accept that this trend cannot be allowed to continue. It is vital that, even after taking account of a number of measures that we are taking to improve efficiency, we take more strategic action to ensure that legal aid is placed on a sustainable basis for current and future generations. The growth in expenditure has led to an imbalance. We now spend a disproportionate amount of money defending people accused of crimes compared to the amount that we spend helping and advising the most disadvantaged and vulnerable people in our society. The Bill is one means by which we are seeking to redress that imbalance and to create a fairer deal for   the taxpayer, while ensuring that defendants are properly advised and represented. It will ensure that publicly funded legal help and advice can go to those who need it most to resolve their disputes and problems, and will refocus resources on priority need. Legal aid must ensure that representation is available for criminal cases sufficiently serious to require it and when defendants cannot afford it. But we believe that it is only right that those found guilty who can clearly afford to pay for their own advice and representation should pay for it themselves. Legal aid must be reformed so that it responds to what justice requires and so that it continues to be an effective, fair system that provides access to justice for all who need it and gives the taxpayer value for money. Your Lordships may recall that the CDS Bill was first published in draft in the third Session of the last Parliament and underwent pre-legislative scrutiny in the spring of last year. The draft Bill and a description of the supporting policy, as it existed at that time, were also published as part of a wider public consultation. The Constitutional Affairs Select Committee published the report of its inquiry into the draft Bill on 27 July 2004 and the Department for Constitutional Affairs responded in November 2004. Subsequently, the Criminal Defence Service Bill, which had an accompanying framework document detailing the supporting policy, was introduced into another place in December 2004 but the Bill failed to complete its passage in the curtailed Session before the general election. Before I move on to summarise the powers under the Bill and outline the scheme it is intended that they should create, I shall say a few words about the evolution of this policy. The Bill and the new scheme that will be set up under it were developed taking into account not only the findings and recommendations of the Constitutional Affairs Select Committee but also a wide range of input from key stakeholders. That input was received as part of the formal consultation process and as part of a continuing and useful engagement on the part of the professions. By necessity and design, despite the slightly protracted timetable, the policy in this area has not stood still. In the time since its first introduction, the Government and the Legal Services Commission have worked together to evolve and refine the way in which the final scheme will operate. Those who have followed the progress of the Bill will recall that the early models proposed for its implementation relied heavily on the participation and investment of the professions. Our proposals were not widely well received and we accepted at that time that we needed to devise a scheme that minimised the risks to the supplier and substantially reduced the burden of bureaucracy on the defendant and his or her representative. In short, in bringing forward the Bill, and in developing the proposals for its implementation, the Government have listened and responded. What we have published in the new framework document now has a broad level of support from the legal professionals who will be most affected by its introduction. Despite the large amounts of progress made in developing the detail of the policy, the Bill and the powers it is intended to confer remain unchanged, with   the exception of a small number of technical consequential amendments. The Bill contains two enabling powers that facilitate the transfer of responsibility for the power to grant representation from the courts to the Legal Services Commission and the reintroduction of a test of financial eligibility; a means test. Both powers relate to criminal cases only. I should add that the Bill extends to England and Wales only. Clauses 1 and 2 confer these powers by amending Schedule 3 to the Access to Justice Act 1999. Because its overall effect is fairly opaque when read in isolation, we have appended to the framework document a text of Schedule 3, as it would read when amended by the Bill. I hope that the House will find it helpful. Clause   3 takes the power to impose contribution orders, and is required for the purposes of the future Crown Court scheme and for the arrangements for dealing with   unusually high cost cases. Clause 4 makes consequential amendments to other legislation. The scheme to be developed under the powers provided by the Bill will take the following shape: the   grant of legal aid will cease to be an almost wholly judicial function and will become the responsibility of   the Legal Services Commission. Financial accountability for the means and the merits tests will lie with the LSC, subject to the appeals process. In practice, this will mean that the court staff, who already have substantial experience of the grant of legal aid, will remain responsible for its day-to-day operation in an arrangement to be governed by a service level agreement with the Legal Services Commission. There would be an appeal to the court against a decision to refuse representation based on the interests of justice test. Transfer of grant will ensure consistency and certainty in grant behaviour and will ensure that the Legal Services Commission gains far greater control over expenditure in this area. There will be an early means test as soon as a legal aid application is made, based on an assessment of gross income and on a number of eligibility allowances designed to reflect average costs of living, calculated on the individual circumstances of the applicant. There would be no contributory element, apart from in exceptional circumstances involving high cost cases. We will introduce a limited number of eligibility allowances to ensure that the scheme is fair, sensitive to individual circumstances and reflects capacity to pay. Means information would be collected from defendants at the earliest opportunity after entry into the criminal justice system on a consolidated application form covering both the early advice and assistance scheme and the grant of representation. Under the new two-tier scheme, defendants would be able to apply for legal aid under an extended advice and assistance scheme running up to and including the   first hearing, at which time a means-tested representation order would come into force. Eligibility for this scheme would be determined on merits only; applicants would not be tested for means. This will ensure that the new system does not introduce delay and that it takes advantage of the natural pauses that already exist within the criminal justice process. We do not believe that what we are proposing for the Magistrates’ Court would be an efficient or fair model for means testing in the Crown Court. In the short term, we therefore plan to strengthen further and enhance the existing system of recovery of defence costs orders in terms of their administration and enforcement, as well as making greater use of the courts’ existing power to restrain people from disposing of their assets. The Bill confers the power to introduce formal means testing into the Crown Court. The eventual scheme will rely on a combination of powers within existing legislation and new powers taken by the Bill. The Government will publish a more detailed model for the Crown Court scheme in due course and repeats its firm undertaking to consult further and widely on these proposals. Your Lordships will note that the new scheme as a whole is described in a good deal more detail in the framework document that accompanies the Bill. The Government believe that the Bill, and the new scheme, strike the right balance between fairness to the   defendant and administrative simplicity. The new arrangements will be predictable in outcome and easy to understand for defendants, solicitors and the court-based teams responsible for administering them. They will ensure that those who can afford to pay for the cost of their own defence will do so, if convicted. Most importantly of all, they will ensure that a sustainable legal aid system continues to exist to protect the rights of current and future generations. On that basis, I have no hesitation at all in commending the Bill to the House. Moved, That the Bill be now read a second time.—(Baroness Ashton of Upholland.)