Finian McGrath (Dublin North Central, Independent)

I welcome the opportunity to contribute to the broad debate on this Bill. I hope the Minister will listen to the genuine concerns of citizens of this State and members of the legal profession who have served this country well. We are honoured to have had many great and visionary people serve in the legal profession. While a small minority of people have damaged its good name, the vast majority have done an excellent job. Some people involved in the legal profession in Northern Ireland have paid the ultimate price, including Mr. Pat Finucane and Ms Rosemary Nelson who stood up for human rights and justice and suffered the consequences for doing so. It is important that such people are remembered in this debate.

Northside Community Law Centre, which is an independent law centre, has served its community for more than 36 years through the provision of free legal services to individuals and groups in the local community. It, like me, recognises the need for changes to the legal profession to make it fit for purpose in the 21st century. However, we are concerned that particular provisions of this Bill will adversely affect the independence of the legal profession, will result in decreased access to justice and will, in practice, lead to higher legal costs.

The independence of the legal profession is crucial. Northside Community Law Centre is concerned that the provisions in this Bill allowing for ministerial-State control of the proposed new regulatory authority will result in a serious diminution of the independence of the legal profession. An independent legal profession is an essential feature of any democratic State or nation which allows members of the legal profession to challenge the organs of State to ensure fair and just exercise of executive and legislative functions.

I am concerned about the proposed provisions in regard to the selection and appointment of members of the authority and the control which the Minister will have in regard to many of its functions. I am also concerned that these will provide the Minister for Justice and Equality with too great a reach into the regulation and oversight of the activities of the profession and may be vulnerable to abuse. I am further concerned about the costs of the authority and the system of regulation provided under the Bill to the profession and, ultimately, to clients. It is important to note that any measures that result in further costs being passed on to clients will adversely affect access to justice, in particular for those on low incomes.

I am concerned that the partnerships and multidisciplinary partnerships to be introduced by the Minister on foot of proposals from the authority will seriously affect access to justice for people on low incomes. Partnerships of barristers and of solicitors and barristers and multidisciplinary practices, MDPs, will destroy the independent referral bar and would be contrary to the best interests of the public and the administration of and access to justice and competition. They are likely to lead to an increase in costs and conflicts of interest and to affect adversely the ability of disadvantaged clients to access the counsel of their choice, which they can have under the current system. Moreover, the so-called cab rank rule will go and the ability of independent law centres such as the Northside Community Law Centre, Coolock, to instruct counsel to take on cases at no cost to clients who cannot afford to pay will be seriously eroded. This will damage access to justice and I also am concerned that partnerships of whatever kind will not lead to a reduction in costs. These are the major concerns expressed by the Northside Community Law Centre, Coolock. I take this opportunity to thank and commend Colin Daly and his staff there on the excellent work they have done right across the north side of Dublin and in the broader community, as they have served us well.

When one considers the details of the legislation, one notes the Bill provides for the establishment of a new regulatory authority, a complaints procedure and a legal costs adjudicator. The new authority will have 11 members and will report directly to the Minister and relevant committees. The law governing legal services has been reformed at regular intervals since 1954 but as this Bill presents one of the most far-reaching and important attempts, it therefore is critically important for the Minister to get it right. For the first time, barristers will be covered and organised by specific legislation as heretofore legislation has concentrated on solicitors.

The memorandum of understanding between the Government and the EU and IMF commits to removing protections to sheltered sectors and this applies to the legal profession. When the previous Government met to establish a deal with the EU and IMF, there was some surprise at the specific wishes from the troika in this regard. It later transpired that the EU Directorate General for Competition, DG COMP, was given specific briefings by the Irish Competition Authority with regard to its wishes for competition across sectors and this was pushed through to the troika by the relevant officials. It would appear the Government is behind schedule on this issue as reforms were to have been in place by the last quarter of 2011. However, the Bill had only been published at this time and the Government is likely to come under pressure to speed up this element. It should be noted, however, that the current Bill goes far beyond the requests of the troika and the Competition Authority in respect of the establishment of authorities and numerous practices. Therefore, it is important to note the most controversial elements of the Bill are included at the Government's behest as opposed to outside influence.

The Bill also contains progressive elements as regards training and access to the profession by ending the monopoly currently enjoyed by the King's Inns on the training of barristers. I welcome such sections and do not make that point lightly. I strongly welcome the sensible measures included in this legislation and this provision opens up more opportunities for others to study and access courses leading to qualification. However, on closer inspection, elements of the Bill have been poorly structured. The Government was obliged to take the unusual step of issuing an erratum slip due to confusion and omission in respect of sections 77 and 78. It also should be noted that the table of laws to be repealed by the Bill is incomplete at this must be corrected at a later time.

As for opposition to the Bill, it has been evident since the outset of the debate that the Bar Council of Ireland and a number of leading law firms have expressed grave doubts about the Bill and its objectives. This is a legitimate concern which should be listened to. There are questions over the separation of powers. The Oireachtas, the Executive and the Judiciary-legal profession are the three pillars of the State. Great care always has been taken to ensure these operate independently of one other and without fear or favour to another pillar, which is essential. While the Competition Authority and the troika suggested an independent regulator to oversee the current work carried out by the Law Society of Ireland, the Bill proposes to set up a completely new authority that reports to the Minister. This suggests that Irish law firms or barristers are not entirely independent of the State. A Minister may be considered to hold authority over this board and its decisions may be reflective of the desires of the Government. The fear exists that this will in the first instance reduce the willingness of the legal profession to take action against a Minister or the State and second, may encourage multinational firms to seek law firms operating out of the United Kingdom to handle any cases in which the State is to be challenged.

I will provide a list of key issues regarding independence for the Minister's benefit. First, the Minister will appoint the authority. Second, the Minister will sign off on any advisers to the authority. Third, remuneration and expenses of the authority are to be decided by the Government. Fourth, the strategic plan of the authority must be approved by the Minister. Fifth, the Minister must approve any code of practice or amendments to same and sixth, the Minister may examine the accounts of the authority at any time. The Government argues that this question does not arise as the Minister only has control in a reporting capacity and will not be in a position to exert influence over the profession at large. While it is possible to see the Government's point of view, the Bill presupposes that all Ministers always will act in good faith. The Bill opens the door to potential abuse should a Minister in the future choose to do so. It might be argued that a solicitor seeking to question a Minister about activities - Members should think of former Ministers for Justice such as Ray Burke or Sean Doherty or back to other parts of our history - might find himself or herself open to additional investigation and red tape from a body that is controlled by a Minister and populated by people appointed by that Minister. Therefore, the issue cannot be entirely disregarded.

In respect of the cost of the authority, the new authority undoubtedly will incur significant costs to run. The Government had promised to reduce the number of State bodies and authorities but this in effect will see the establishment of a new and large authority. The cost of running the authority is to be passed on to the legal profession. However, in reality this cost will be passed on to the consumer and could mean higher legal costs will ensue, which is the precise opposite of what the Bill is intended to achieve. The authority itself appears to be an unwieldy body and it can safely be assumed that staff currently performing a similar function in the Law Society of Ireland will be transferred to the new authority. Further new staff also will be required and as a result, compliance costs are set to rise significantly - some estimates suggest by between €10 million and €20 million. A simple and effective solution for the Government would be to propose a statutory cap on compliance costs to ensure the new system costs no more in compliance than the current regime. By doing so, the authority automatically would be incentivised to keep down costs but in its absence, there is no real reason for the new authority to control compliance costs. Although efficiency will be a major concern for the new body, it is clear that with 11 board members and in excess of a further 30 members of committees, this will be a body of many layers but not a lean or highly efficient one.

As for the legal costs adjudicator, this new role will replace the former High Court Taxing Masters in respect of the issue of costs. However, under the Bill the function of the adjudicator will be broadly the same and it is difficult to discern how the adjudicator will differ on decisions from the sometimes exorbitant costs that were perceived to be a problem under the regime of the High Court Taxing Masters. It also is intended that meetings before the adjudicator will be held in private and some would question this from a transparency perspective. In respect of solicitors' costs, the Bill provides that once a solicitor has been engaged, he or she must provide a client with a detailed set of costs. This is a positive step that will allow clients to plan for the costs involved. However, this will only occur once the solicitor actually is engaged. While this is not a problem for clients with some resources, most ordinary people will need an accurate prediction of costs before they can decide to engage a solicitor. Therefore, the Bill may fail to improve access for many citizens or allow them make an informed choice on the best solicitor or the cost of an action.

As for the State legal services, I note one of the biggest consumers of legal services is the State itself. Costs are a direct consequence of what a legal professional considers to be a fair market rate and therefore, the level of fees the State is willing to pay to engage legal services has a direct trickle-down impact on the cost of all services. A major problem exists in that the Government still does not tender for a large proportion of this work and without doing so there must be serious concerns with regard to value for money. That is a legitimate point in respect of State legal services.

New business structures are proposed by the Bill in the form of legal partnerships and multidisciplinary practices. These new structures tend to work against small firms or single solicitor practices and will only benefit the larger firms. The big boys and girls rule again. One of the problems Irish law firms face is the idea of current partnership rules. As things stand, partners to a law firm have unlimited liability for that firm. For this reason, most partners in firms ensure the family house is in the name of a spouse rather than their own and so on. This has been dealt with in other countries by the introduction of limited liability partnerships. Most English law firms currently selling services into Ireland operate on this basis and find it an attractive means to recruit new partners and emerging talent.

The idea of a multidisciplinary practice does not hold much weight as there would be serious questions as to why an engineer, for example, would want to partner a solicitor who has unlimited liability. Given the circumstances from which Ireland has just emerged, it is equally reasonable to question the wisdom of promoting such multidisciplinary practices. Independence within professions provides a certain amount of ongoing oversight for clients. However, would it have been wise during the housing boom to have a solicitor, engineer and auctioneer form a multidisciplinary practice? The aim of transparency, as contained in the Bill, could find itself lost if such practices were to emerge on a large scale and the consumer were to be severely limited when making choices on who to engage for what services.

These are my concerns in respect of this Bill. I will listen to my colleagues when I make my final decision on the Bill. It is important we have a comprehensive discussion on the Bill, and I welcome some of the main sections in it. However, I urge the Minister to listen to the constructive views of many of my Independent colleagues in this House who have spoken on the legislation. We have listened to all sides. I have an open mind on the issue. I just want to ensure we have a quality legal profession in this country that serves the interests of the State and its citizens.

See this speech in context