Question to the Ministry of Justice:

To ask Her Majesty's Government what assessment they have made of the impact of a reduction in the provision of the Standard Monthly Payments to criminal legal aid firms on the number of criminal defence lawyers.

At present, 17% of all crime accounts are paid under the Standard Monthly Payment (‘SMP’) model. The remainder have opted for Variable Monthly Payments, which pays the actual value of the claim submitted each month. Firms can elect to be paid by either model, according to which may be most advantageous to them. SMPs relate to Controlled Work services only, and therefore reflect a proportion of a Provider’s total revenue.

The number of those accounts paid via SMP which have seen a reduction in payments since July 2020 represents 6% of all crime accounts. Where a reduction is necessary, this takes effect following the Legal Aid Agency notifying providers of this in advance. Firms facing financial hardship can discuss payment options further with their LAA Contract Manager.

The LAA have been in contact with providers to assess the impact on their businesses and can confirm that no Criminal Defence Providers have exited the market as a result of a reduction in SMPs.

The LAA has implemented several changes to maintain cashflow to firms and to allow firms to be paid more quickly – through these changes we can inject up to £51 million per year into criminal legal aid. We have begun a review into how criminal lawyers are compensated for their work and there is more information about this here: https://consult.justice.gov.uk/criminal-legal-aid/criminal-legal-aid-review/

In addition to the support schemes offered by the government, we have continued to pay providers on time and introduced a number of measures to speed up payments to providers. All of the measures taken by the LAA are set out on our gov.uk page and there is further information about this here: https://www.gov.uk/guidance/coronavirus-covid-19-legal-aid-agency-contingency-response#financial-relief-page