The complex land banking scheme fraud case, dubbed “Operation Cotton”, was halted by Judge Anthony Leonard QC at Southwark Crown Court because the five defendants had been unable to find any self-employed  barrister with the right expertise willing to take on the case under the reduced rates.

 A Legal Aid Agency spokesperson said:  “We are committed to ensuring availability of suitably qualified criminal defence advocates to deal with all VHCCs which are pending.” As Counsel went to press, no advertisements had yet been placed for additional recruits to the PDS since the appeal hearing. The Agency said that any recruitment process would be publicised and that VHCCs remain open for members of the self-employed Bar to act in.

A Ministry of Justice (MOJ) spokesperson said: “Barristers have refused to work on this case – and a number of other VHCCs – because they do not agree with savings the Government is making to legal aid.

“The Government will take the necessary steps to ensure representation by putting in place measures to cover all VHCCs that would otherwise be disrupted, given the current circumstances. It remains open to the Bar to take these cases in the meantime.  The Government hopes that the Bar will meet their representation requirements on these and any future VHCCs.”

The spokesman added that the Lord Chancellor adopted a neutral position in relation to the appeal in this particular case.

 Justice Minster Simon Hughes MP, a barrister, told BBC Radio 5 Live’s Pienaar’s Politics that the cuts were “difficult” and he would rather not have them, but that  “on this sort of case, the QCs would be paid  £100,000” and “junior counsel would be paid about £60,000”.

“They are not underpaid, they are not small amounts of money... We are not talking about people at the beginning of their career scrimping around, hard-up for money.

 “This case, we believe, could have had lawyers to represent the defendants. It would have needed a bit of time. In the end the judge decided he was not willing to allow that time to happen.

“Measures are being put in place by the department to make sure that we don’t have cases not going ahead because there isn’t a lawyer.”

Barristers have said that the MOJ has over-estimated the earnings for this case by 30-50% and pointed to the stark contrast with the annual salary offered by the PDS to QCs.

According to calculations released separately by the South East Circuit: “It costs taxpayers £27,750 more to employ a PDS QC to do a VHCC than to get a self-employed QC to do it – at the rates before they were cut by the MOJ. Whilst the PDS QC has a salary of £125,000, the self-employed QC has to pay his own expenses (chambers rent, pension, travel, clerks fees, admin. support, clothing, insurance etc, computer) out of his fee, making the equivalent salary at least 35% less – about £60,000 – to do the most demanding and complicated fraud and terrorism cases.”

Nigel Lithman QC, Chair of the Criminal Bar Association, said in his weekly update to members: “The CBA, Bar Council and Circuit Leaders made it crystal clear to the MOJ that although it was a matter of individual choice, they anticipated the Bar would not do the work cut by 30% and could not agree to deliver that as part of any deal.”

“We were given the assurance that the PDS would not be expanded beyond the recruitment interviews that had already taken place. Any attempt to do so now would be seen by the Bar as a ‘widening of the goal posts’ and a breach of the good faith and reasonable position shown by the Bar leaders in recommending an acceptance of the deal.”