Empowering consumers in the legal services market
The Legal Services Board (LSB) is consulting on a draft policy statement on empowering consumers.
The statement sets expectations for the Solicitors Regulation Authority (SRA) and other frontline regulators to support consumers to better understand and engage with the legal services market.
The LSB intends to use its powers under section 49 of the Legal Services Act 2007 to issue the statement in connection with its oversight role of the approved regulators.
The LSB proposes to set expectations for the SRA and other frontline regulators around:
- public legal education (PLE)
- information about price, quality, service, redress and regulation
Given the diversity of the legal services market, the LSB will work with regulators to ensure that legal service providers offer helpful information to consumers about:
- the cost and quality of their services
- redress and regulation
The Market Transparency Co-ordination and Oversight Group, chaired by the LSB, was set up to provide a forum for this collaboration.
The LSB has proposed a set of general principles and outcomes, as well as more specific expectations for frontline regulators to pursue.
This approach is meant to provide a flexible framework for regulators, while ensuring minimum standards of transparency across the market.
The LSB proposes regulators should pursue the following outcomes:
- consumers have the knowledge and capability to recognise when their problem is a legal issue and know how to get legal assistance where necessary
- consumers have the knowledge and capability to engage effectively with the legal services market
- when choosing a legal services provider, consumers can access useful information about a provider’s services, price, quality, regulatory status and access to resolution of complaints that enables them to make an informed choice as to the provider most suited to meet their needs
The LSB expects regulators to put effective measures to ensure compliance, and have appropriate mechanisms in place to evaluate and report on the effectiveness of their actions.
When developing work on consumer empowerment, the LSB proposes that regulators should have regard to the findings of the Competition and Markets Authority’s legal services market study.
In considering whether specific approaches are required for providers in different practice areas within their regulated communities, regulators should consider:
- the needs of consumers, including those of consumers in vulnerable circumstances – for example, where consumers are digitally excluded and do not have access to information online
- the types of provider and services offered – for example, some services are more ‘commoditised’ (such as conveyancing and wills and probate) than more bespoke areas (such as legal aid) where it may be more difficult to compare providers
The LSB proposes to allow regulators to adopt different approaches to deliver expected outcomes, taking into account of different professions they regulate, but encourages collaboration where:
- there may be overlapping consumer needs
- practice areas are covered by more than one regulator, or
- economies of scale are sought, particularly on testing solutions
The LSB also proposes specific expectations for regulators in the following areas:
Public legal education
The LSB proposes that regulators should put in place an effective PLE programme to help people to understand when they have a legal problem and how to access the professional help.
This is in addition to making contributions to cross-sector initiatives, such as Legal Choices.
Information about price
Regulators will be expected to take steps to ensure the provision of useful pricing information for consumers.
They should consider factors such as:
- the pricing/charging model
- hourly fees (where charged) by grade of staff
- indicative fixed fees, factors that may affect these and the circumstances where additional fees may be charged (where offered)
- typical ranges of costs for different stages of cases (where appropriate)
- the scale of likely disbursements (such as searches or court fees)
- other key factors that determine price (including disbursements)
Information about quality
Regulators will be expected to enable the provision of information on quality of service for consumers.
The LSB proposes to consider the following type of information:
- providers’ disciplinary and enforcement records, including any sanctions
- published decisions made by the Legal Ombudsman on complaints about providers
- quantitative data on a provider’s performance (for example complaints data, success rates, error rates)
- customer feedback, ratings and reviews
Information about service, redress and regulation
The LSB also proposes that regulators should ensure that consumers are provided with other useful information, including:
- contact information
- a description of the services that the provider offers, including areas of practice
- the mix of staff that deliver the services
- key (and discrete) stages of services
- indicative timescales of completing services and factors affecting these
- the provider’s regulatory status, registration details
- the provider’s complaints process and access to the Legal Ombudsman
- details of the provider’s professional indemnity insurance cover
We have a keen interest in promoting access to justice and we’re committed to making sure that legal services meet society’s needs.
The LSB’s draft statement reflects the importance of public legal education in addressing the sector’s challenges related to access to justice and consumer engagement, which we agree with.
However, a wider public policy intervention will be needed to deliver this important policy outcome.
We encourage the LSB to extend the partnership working beyond the legal regulators to develop impactful cross-sectoral initiatives.
Empowering consumers to engage more effectively with the legal market can help to alleviate some of the underlying obstacles to obtaining professional legal advice.
Given the diversity of the professions and practice areas covered by different frontline regulators, a flexible framework for the regulators is needed to make sure regulation:
- is proportionate
- is targeted
- delivers tailored approaches to take account of the needs of clients, especially those in vulnerable circumstances, and the type of provider and services offered
Before considering new measures, we urge the LSB to allow time to fully evaluate the Transparency Rules’ impact to better understand the:
- current level of consumer engagement with existing information
- nature and extent of any challenges the public face
Rather than proposing specific expectations, the LSB should:
- set general expectations regarding information provision
- encourage frontline regulators to do further research and consumer testing to refine the measures over time in consultation with legal providers and other stakeholders
The LSB should require regulators to rigorously assess new proposals to understand the benefit for clients and the impact on the market, especially on small firms and sole practitioners.
Given that Black, Asian and minority ethnic solicitors are “over-represented” in such practices, regulators should consider potential implications for diversity and inclusion.
Before considering promotion of digital comparison tools (DCTs) amongst consumers, adequate consumer protection measures need to be introduced to make sure that:
- the DCTs market operates fairly
- consumers, law firms and practitioners have trust and confidence to engage with such tools
- November 2021 – we shared our response to the LSB's consultation
- April 2021 – we engaged with the LSB’s work and contributed to the discussion on the type of quality indicators that could be useful to provide to consumers
- February 2021 – the LSB published a discussion paper on quality indicators seeking views on:
- what information on quality consumers find helpful
- the best channels for getting this information to them
- potential policy options
- January 2021 – the SRA launched a pilot exploring opportunities for firms to seek feedback from their clients and manage online customer reviews
- December 2020 – the CMA’s progress review concluded that, although some positive progress has been made on improving price transparency, the LSB and other frontline regulators should:
- continue work building on existing transparency reforms to enhance consumer engagement
- make more progress on transparency around quality indicators
The consultation closes on 8 December 2021.
We’ll continue engaging with the LSB and the SRA to explore the issues around consumer empowerment through further research to examine the:
- benefits for clients
- viability and effectiveness of possible solutions in various practice areas