Chris Kenny, chief executive of the Legal Services Board
Chris, firstly can you tell our readers a bit about your own background?
I started my career in the public sector including roles at the Treasury and the Department of Health where I worked under Frank Dobson. I then moved on to OFTEL for four years followed by three years at The Association of British Insurers where I spent much of my time arguing against the FSA on behalf of the organisation’s membership. I then undertook various consultancy projects which included helping to set up the Legal Services Board. I’ve been here since 2008 but I’m actually leaving towards the end of the year.
Can you summarise the work the Legal Services Board does?
In short, we are here to make sure legal regulation happens in the public and not the profession’s interest. The LSB oversees 11 regulatory bodies and we work hard to check what they do is both rigorous and independent. We also try to make sure the legal market is more competitive by pushing innovation and new models. In addition, we aim to get a good deal for the consumer via the commissioning of relevant research and by working with both the Legal Ombudsman and the Legal Services Consumer Panel – the latter is appointed by us. However, our aims, objectives and work are best encapsulated in our eight regulatory objectives:
~ Protecting and promoting the public interest;
~ Supporting the constitutional principles of the rule of law;
~ Improving access to justice;
~ Protecting and promoting the interest of consumers;
~ Promoting competition in the provision of services;
~ Encouraging an independent, strong, diverse and effective legal profession;
~ Increasing public understanding of the citizen’s legal rights and duties; and
~ Promoting and maintaining adherence (by authorised persons) to the professional principles
What role do you think it plays in today’s legal market?
We like to think of ourselves as a ‘constructive irritant’. In terms of law firms and legal service providers, we try to make them think differently about what they might offer and how they can better serve the public; whilst for the regulators, it’s mainly about questioning whether they need quite so many rules. The legal market is a £29bn industry and is growing year on year, but it is data light compared to other similar sectors. We firmly believe that effective research can help - and can ultimately drive - better value and better access to legal services for citizens. So, it’s a big part of what we do and the role we play.
Can you tell us a bit about the LSB’s newly announced three year growth strategy?
It’s still very much work in progress as we’re now developing our 2015/2018 plan. At its core will be our thoughts on how regulators can help (rather than hinder) the legal services sector to develop, and how it can play its part in helping the wider economy grow.
We recently did some research work looking at the legal services that are most in demand from small businesses. The results showed that only 13% believed that lawyers currently provide a cost effective means to resolve legal issues; whilst two thirds know the services they provide are essential. On first glance, you could think this is a really bad state of affairs but on the flip side, it means there is real potential for long lasting commercial growth for those firms and organisations which embrace a clear vision and respond in the right way.
Our strategy will also include challenging the various regulators on whether all the current rules in place are absolutely essential and if they might just be an added cost burden. In our view, the priorities need to be about proper deregulation that doesn’t compromise any core principles but does eliminate any detrimental effects on the consumer.
Last year, the LSB issued a blueprint for reforming legal services regulation. Can you give us an overview?
It came out of an exercise which Chris Grayling launched around regulation. This was useful as it gave momentum to our own initiatives. The blueprint was a major set of proposals for the future of legal regulation and was a fundamental review of the way in which the 2007 Legal Services Act was working. It covered many areas including the simplification of the legislative framework for legal services, rights for consumers of all legal services to access the Legal Ombudsman and new freedoms for the Office for Legal Complaints to develop its services, as well as the development of a single regulator.
The simple fact is that the entire system is just too complicated. Proposals such as the single regulator would cost half as much as the current status-quo and would eliminate duplication of work and unnecessary liaison between bodies. Also, boundaries of roles are constantly merging and becoming blurred so it makes less and less sense to have these multiple bodies. The government has said that it will defer any decision on the single regulator question until after the general election. However, it’s been encouraging to see that both the Lord Chief Justice and Lord Neuberger - the president of the Supreme Court - both intimate that they would support it.
What do you think are the other main challenges and issues facing the legal sector?
Generally, it’s all about gearing up for growth. The recession did hit the legal sector more slowly than other industries; I think most people would agree that more often than not, bad news for business means good news for lawyers. However, conveyancing and M&A specialists were certainly badly affected so driving these kinds of areas forward is a challenge.
On a wider note, the recession has also bred a new type of consumer who is more demanding, less cash rich and willing to challenge the services they receive. Consumers are more confident about saying ‘no’ so it’s vital to show that you’re offering value for money without compromising on quality. Also, many firms are taking costs out of the system by better use of IT and by utilising all parts of their workforce; for example, paralegals and legal executives are doing the kind of work that historically would have been undertaken by a qualified solicitor. All of these factors are driving change and challenging how businesses work internally.
What else is the LSB working on now?
As I’ve said, the big focus is our three year strategic plan which we need to push forward. This new agenda around growth and innovation, knowledge and research will help regulators, firms and the consumer by making them think about access to justice more widely. We need to consider how we can help people with whatever problem they face by finding ways of enabling them to be better served but that also takes into account economic realities.
How do you think it will change and evolve over the next 10 years?
I hope the market will evolve quickly, that regulation will be more proportionate and that there will be a more straight forward system in place. Things are heading in the right direction but I’d like to see progress accelerated and consolidated... sooner, rather than later.
What role do you think the LSB will continue to play?
Our genuine desire is to put ourselves out of business once the market is working properly and regulation is simplified. There’s some way to go but that’s the ultimate goal.