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GAZETTE
V I
E W P O I N T
APRIL 1994
L a w S o c i e t y E x p e n d i t u r e:
G e t t i n g V a l u e f o r M o n e y ?
There is increasing emphasis
nowadays in virtually every walk of
life on openness and accountability
and, in relation to professional
organisations that are spending their
members' money, questions inevitably
arise about whether those who are
footing the bill are getting value for
money. The Law Society, as a
representative organisation financed
through the subscriptions of its
members, is no exception. It too is
called upon, from time to time, to
render an account of its stewardship.
The Society is required under its bye-
laws to publish audited accounts to its
members each year and the members
are entitled, at a general meeting, to
discuss the accounts and ask
questions. Recently, as a result of the
initiative of a particular group of
members, an item of special business
on the finances of the Society was
requisitioned for the half-yearly
meeting of the Society held in
Connemara. As those members of the
Society who were present will recall,
the ensuing debate at the meeting was
lively and informative.
In the last ten years, the cost of a
member's registration fee (practising
certificate and member's subscription)
has increased by over 97% (from £274
in 1984/85 to £541 (excluding group
life assurance scheme) in 1994/95). In
the corresponding period, the
Consumer Price Index increased by
only 39%. It is clear, therefore, that
Law Society expenditure has been
outstripping inflation. Members are no
doubt interested in why this is so and,
at the meeting in Connemara, some
members sought explanations for the
current comparatively high levels of
expenditure.
The audited accounts for the year
ended 31 December, 1993, show that
income from registration fees
amounted to about £1.7m while
expenditure on running the Society
(excluding the Law School and the
Compensation Fund) came to £2m.
The balance was made up from
income derived from other sources -
principally the commercial activities
engaged in by the Society - so that,
overall, there was a small surplus.
However, expenditure over the years
(including capital expenditure) has
been exceeding income and
accumulated debt as at the end of
1993 was almost £800,000. In his
letter to the profession in January, the
President of the Society outlined the
steps that were taken to deal with this.
Capital expenditure would in future be
financed in the main by means of
fixed term borrowing and total
Society indebtedness would be
gradually reduced. The President also
spoke about the need to improve
facilities at Blackhall Place and also
to improve services for members.
These desirable objectives
necessitated a further increase of £75
in the registration fee for 1994 - an
increase of 15%. Not unexpectedly,
this increase precipitated discussion at
the half-yearly meeting and the
meeting passed a resolution calling on
the Society to continue to pursue
vigorously policies that would bring
about an overall reduction in cost to
members.
Running a statutory regulatory body,
that also has a representative role, for
a growing profession of 5,000
solicitors is an expensive business
and, in our view,
when regard is had
to all relevant considerations,
a
registration fee of £575 is not
unreasonable. The Society is obliged
under statute to discharge its function
of registering and licensing solicitors
to practice. It must also carry out a
disciplinary role, upholding the high
ethical and behavioural standards that
the members rightly set for
themselves. At a time of increasing
difficulty and default in the
profession, this regulatory role is
demanding ever-increasing resources.
The evidence suggests that complaints
against solicitors are growing and the
Solicitors Bill will add further to the
volume when the new jurisdiction
relating to shoddy work and
overcharging is fully operational. The
appointment of a legal ombudsman -
also a feature of the Solicitors Bill -
will also undoubtedly impact further
on the administrative costs of the
Society, quite apart from the fact that
the Society itself will have to fund the
office.
The Society, of course, also provides
services to members and represents
the interests of members in relation to
all matters affecting the profession. In
recent times, the Society has been
taking steps to improve the quality of
legal practice in this country. A
Practice Management Committee has
been established and that Committee
is developing practice management
'standards' and intends to promote
these throughout the profession. A
series of seminars will be held
throughout the country. The recently
launched
Solicitor Link
service also
aims to assist practitioners who are
seeking to amalgamate or otherwise
reshape their practices. Members will
also have observed a much-expanded
Continuing Legal Education
programme which, to date, has been
highly successful. These are just a few
of the more recently developed
services that have been added to the
traditional range of services on
professional practice matters
including, of course, the excellent
library services.
In its representational role we believe
that the Society has acquitted itself
well in recent times, particularly in its
negotiations with the Government on
the Solicitors (Amendment) Bill. The
Government's decision to remove
from the Bill provisions that would
have allowed banks and other
financial institutions to do probate and
conveyancing has been greatly
welcomed in the profession. It is clear
also that the Society has been working
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