Raid on client accounts will hit high street law firms hard and increase fees, warns Law Society
07 Jan 2026
Less than 1 minute read
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The Ministry of Justice (MoJ) will put high street law firms at risk and force legal fees to rise for those that survive if it goes ahead with proposals in its consultation published today (7 January), which would divert funds from Interest on Lawyers’ Client Accounts (ILCA) to the MoJ budget.
Law Society of England and Wales president, Mark Evans, said: “The MoJ has decided to take money from the interest earned on law firms’ client accounts to boost its own budget. Yet, as its own consultation reveals, it has no clear idea how this proposal will work in practice and no understanding of the serious consequences this will have on high street firms and access to justice throughout England and Wales.
"Firms will close, fees will rise and clients will be impacted if the MoJ goes ahead with the proposal.
“The cost of doing business in the legal sector is already high, with recent rises to National Insurance contributions meaning businesses are paying more. The proposal comes at a time when small firms will have to manage new regulatory burdens on anti-money laundering supervision and tax adviser registration. High street law firms will face a perfect storm of new bureaucracy, undermining the UK government’s efforts to achieve growth and revitalise local economies.
“Despite the short timeframe for the consultation and the MoJ’s efforts to keep the proposal under the radar, the Law Society will be consulting widely with its members across the country.”
The Law Society is the independent professional body that works globally to support and represent solicitors, promoting the highest professional standards, the public interest and the rule of law.