By mid-March, the Bar Chairman had talked at nine seminars in six cities, spoken with almost 2,000 barristers and clerks, visited nearly 50 sets of chambers, and clocked up over 1,300 miles on the road. Members of the Bar of all levels of seniority were drawn into each meeting and in some cases quite literally packed the rooms to the rafters. In London, one event was not enough and we have had to run the seminar on two further occasions. At the end of each session the audience was invited to fill in simple questionnaires enabling comments and observations to be made. Feedback from the seminar has included the following comments:
- “We’re not businessmen and now is the time when we need business advice.” (Birmingham)
- “The ability to bid for block work through a ProcureCo will grow dramatically over the next two years. The BSB is likely to be a cheaper regulator than the SRA and it should acquire the power to regulate BoPs and LDPs.” (London)
- “We need to compete on a level playing field.” (Cardiff)
A member of the BSB joined the Leader of each Circuit and the Chairman of the Bar on the panel to explain the business implications and opportunities presented by the Legal Services Act 2007 (“the 2007 Act”) and the BSB’s rule changes. They discussed some of the opportunities for chambers to be competitive in a rapidly developing market, and the audience spoke frankly about their views on the current and future state of the Bar. Unsurprisingly, some individuals were more optimistic about the changes than others.
Issues raised in the discussions
Many in the audiences have asked: “How can we compete with solicitors for block-contracts when the Bar doesn’t have the infrastructure?” or “How can block-contracting be profitable for chambers when competing with firms of solicitors?” There are no definitive answers to these questions but information received during chambers’ visits indicates that in civil and commercial work, chambers can be 60–80 per cent more efficient to operate in cost terms than comparable firms of solicitors, which gives the Bar a very strong competitive edge on price, to say nothing of quality.
The infrastructure currently missing to enable the Bar to compete can be provided for by a procurement company (appropriately, if unimaginatively, called “ProcureCo”). ProcureCo is a generic term used for a company, or other incorporated entity, which administers and procures legal services. Some types of ProcureCo can be used under the rules as they exist today in order to bid for block contracts with large purchasers of legal services. The Bar Council will be publishing sample contractual terms and a complete guide in early April.
The Bar Chairman was also asked, “How is it in the interests of the referral Bar to bid against the very people who feed it work?” and “If we compete on the grounds of high quality and not just competitive tenders, do we not run the risk of alienating those firms who have in-house HCAs?”
How individual firms of solicitors will react to the referral Bar competing directly with them is currently a matter of conjecture. Many, and in particular those at the Criminal Bar, have forcefully expressed the view that the Bar simply has no options. As one very senior member of the profession and former Circuit Leader put it: “It is compete or die by a thousand cuts.”
The junior Bar
On 11 March the Bar Council’s Young Barristers’ Committee hosted a roadshow seminar for barristers under 10 years’ Call. The seminar included videolinks from Birmingham, Leeds, Liverpool and Swansea (for a full report see the May issue of Counsel). As they will have to live with the changes for decades to come, it is vital that the Young Bar understands the changes and opportunities; that they feel engaged with the decision
A number of other themes emerged during the course of the roadshow and the Chairman’s discussions with barristers, clerks and practice managers in chambers. The growth in work handled by higher court advocates and the increase in CPS in-house advocacy were often raised as sources of concern and frustration. There was demoralisation due to the Ministry of Justice’s proposed cuts to legal aid. Fears were expressed about the future of the self-employed Bar. But some barristers and clerks spoke positively of the opportunities that increased direct access might offer the Bar, while others talked of creative ways to bid for work with local authorities and the Legal Services Commission.
The role of the Bar Council
There are no easy answers. The Bar Council aims to guide the Bar through the challenging years ahead. The BSB will begin consulting with the Bar later this year on whether it should become a regulator of entities (such as barrister-only or barrister-majority partnerships), or whether it should leave entity regulation to the Solicitors Regulation Authority. We urge everyone to participate in that process.
Maintaining the momentum
The Chairman of the Bar and the Bar Council still need to hear more from the Bar. By the time the 25th Annual Bar Conference is held in London on 6 November 2010 we hope to have an even better understanding of how the legal services market is developing, and where the future of the Bar lies for many practitioners. If ever there was a reason to attend the Bar’s flagship event this must be it. In the meantime the Circuit Leaders have committed to maintain the momentum of discussion and debate by setting up local forums in which members of the Bar can participate on a regional level. Details are on the Circuit websites or they can be found by contacting the Circuit Administrators.
The Bar Council has prepared a set of documents which explain the BSB’s changes and the business model concept we have come to know as ProcureCo. If you did not manage to pick up these materials from any of the roadshows, they can be downloaded from the Bar Council’s website (www.barcouncil.org.uk/news/latest/502.html).
Paul Mosson is the Head of Member Services. Ariel Ricci is the Executive Assistant to the Chairman of the Bar Council.
The new working practices
In November 2009 the BSB made historic changes to the way in which barristers can supply legal services by accepting the following recommendations:
- Barristers should be permitted to become managers of Legal Disciplinary Practices (“LDPs”), regulated by the Solicitors Regulation Authority (“SRA”) without having to requalify as solicitors.
- The decision to permit barristers to be managers of LDPs should apply only in principle to LDPs which include up to 25 per cent non-lawyer managers. The BSB recognises that LDPs which contain one non-lawyer manager will be redefined as Alternative Business Structures (“ABSs”) in the context of the regime for licensable bodies that is expected to be effective in 2011. However, any wider decision to permit barristers to work in ABSs should be deferred until the effects of the transitional LDP regime can be reviewed and assessed and following further consultation in 2010.
- Barristers should be permitted to practice in more than one capacity at the same time, eg as both managers of LDPs and as independent practitioners. Detailed guidance will be developed in relation to this.
- A number of possible conflict of interest issues arise if barristers become shareholders in LDPs. Barristers should be discouraged from such investments until proper guidance in relation to conflicts and perceptions of conflicts of interest is developed by the BSB.
- Barristers should be permitted in principle to form barrister-only partnerships (“BoPs”), pending the creation of an appropriate regulator for such entities, currently not in existence, and consultation by the BSB in relation to becoming such a regulator.
- Barristers should be permitted in principle to practice through other barrister-only companies and limited liability partnerships (“LLPs”). However, further work is required to determine if the BSB should regulate these entities.
- The cab-rank rule will apply to BoPs, as well as the self-employed Bar. The BSB considers that all advocates should be subject to the cab-rank rule and will be raising this issue with other regulators.
- The BSB should consult on whether or not it should become an entity regulator of the new legal entities, and, as part of this consultation, look at whether a modified cab-rank rule can be applied to barristers practising as managers of LDPs undertaking advocacy work.