Hansard

Good morning, convener and committee members. I begin by declaring that I am a Scottish solicitor, but I am not in practice.At the heart of the bill is the removal of the current restrictions on how solicitors can organise their businesses. The bill will allow solicitors to form partnerships with non-solicitors, to create businesses offering a range of legal and non-legal services and to seek investment from outside the profession. However, the bill is enabling rather than prescriptive; therefore, traditional business models will remain an option.As the committee has heard over the past month or so, there have been demands from within the legal profession for the flexibility that the new business structures will allow. After extensive consultation and debate, the profession voted overwhelmingly in favour of alternative business structures at the Law Society of Scotland's annual general meeting in 2008. The view that was taken by the majority of the profession who voted was that those structures would make it possible for law firms to develop new ways to deliver more effective and efficient services in the interests of their clients and the continued success of the Scottish legal system. Furthermore, our public consultation found a majority in favour of the reforms.Solicitors in England and Wales will soon be able to operate in alternative business structures and access external investment under the Legal Services Act 2007. That will put Scottish firms at a competitive disadvantage and will threaten the long-term sustainability of the Scottish legal profession unless Scottish firms are able to operate on a level playing field.The bill will create a tiered regulatory framework in which the Scottish Government will be responsible for approving and licensing regulators that, in turn, will regulate licensed legal services providers. The bill also includes measures to reflect changes in the governance of the Law Society of Scotland; statutory codification of the framework for the regulation of the Faculty of Advocates; provisions to enable the Scottish Legal Aid Board to monitor the availability and accessibility of legal services; and provisions to allow non-lawyers to apply for rights to obtain confirmation to the estates of deceased persons.I am aware, however, that not everyone shares the view that the bill will have a positive impact. Over the past month, I have met some of those who have expressed reservations about the proposed reforms and have listened to the evidence that has been given to the committee, and I have found those meetings very helpful. Although I believe that some of the concerns that have been expressed are unfounded, I fully understand why the proposed changes have provoked apprehension and why there is concern about preserving access to justice as well as the effectiveness and independence of the Scottish legal profession. Indeed, the very first section of the bill emphasises the importance that we attach to those matters. However, if there are suggestions as to how we can strengthen that commitment still further without undermining the aims of the bill, we will consider them extremely carefully.Third-party ownership is understandably viewed with some trepidation. Some believe that allowing non-solicitors to own a stake in legal firms is a threat to the independence of the legal profession and the core principles that have been at the heart of the practice of law in Scotland for centuries. We have spent considerable time developing safeguards against those potential threats, such as the introduction of regulatory objectives in section 1, as I mentioned, and professional principles in section 2, and robust provision has been made to ensure that only fit and proper persons are allowed to own firms that provide legal services. It has also been suggested that outside ownership could threaten Scots law by allowing those with little knowledge or understanding of our legal system to become involved in it. I repeat that the continuation of a strong, independent Scottish legal system is something that the Scottish Government supports strongly, and the bill does not jeopardise that.In most areas of legal work, including conveyancing, litigation, succession and family law, anyone who wishes to offer a legal service in Scotland will need to do so using Scots law. There are, of course, areas such as commercial work in which there is a choice of jurisdiction to a degree. However, in those areas, Scottish solicitors already face competition from English firms and, potentially, from new entrants licensed under the legislation in England and Wales. Widening the options for Scottish law firms is the best way to ensure that they remain independent and able to compete effectively.Some have questioned the level of support for the reforms from the legal profession and have suggested that changes are simply being imposed from above. With respect, that is not the case. Despite some points that have been raised in previous evidence-taking sessions, support for the proposals was expressed by the Law Society's membership in a vote that took place in accordance with its established democratic processes. In addition, we remain keen to have constructive discussions with those who might have concerns about the bill, as I have done recently.A few questions have been raised about the training and qualifications that are required by those who provide legal services, with suggestions that the bill will allow unqualified individuals to practise law. I stress that the bill makes no changes to the areas of work that are reserved to solicitors under the Solicitors (Scotland) Act 1980. As regards non-solicitor employees of legal practices, such as paralegals, the present position is that they are able to work in those reserved areas under section 32 of the 1980 act. The bill simply provides that such individuals will be able to do so in the new entities as designated persons. A further safeguard in the bill is the requirement for a head of legal services. He or she must be a solicitor and is to manage designated persons with a view to ensuring that they comply with the regulatory objectives and professional principles.A final point that has been put to me is that increased competition from large firms entering the legal services market will put small and rural firms out of business. As a former self-employed solicitor and partner in a small business, I can definitely understand that fear, particularly in the current economic climate. However, I can also see the opportunities that the bill presents for such firms. Where small practices might struggle to survive in towns and rural areas, a one-stop shop offering a variety of professional services might present a solution that allows lower overheads and the combination of business experience and expertise. That could give small professional practices, whether legal or not, an opportunity to flourish and continue to provide key services in communities throughout Scotland.As the committee might be aware, we are considering introducing to the bill a number of areas at stage 2. In brief, those are McKenzie friends, which have been the subject of much discussion and debate in recent months; possible amendments to rights of audience in the supreme courts, subject to the recommendations of the on-going Thomson review; various technical amendments to the 1980 act; and the regulation of will writers. We are consulting on that last point, but we are extremely sympathetic to the view that non-solicitors who are involved in preparing wills should be regulated.I am more than happy to expand on any point that I have mentioned. To the best of my ability, together with my officials, I will answer the committee's questions on the bill in general.