Legal Services Regulation Bill 2011: Second Stage (Resumed)

Question again proposed: "That the Bill be now read a Second Time."

I am glad to resume this debate. I was the last person to speak on it just before the Christmas break. I had some very strong things to say that day. I hoped that when we came back there would be a new year's resolution. I spoke then about the arrogance of the Government after ten months in office. Now we are back here after the Christmas recess, and after time for reflection I find nothing but total disrespect for the people on this side of the House and by extension, for the public. We are seeing Bill after Bill. The House was misled here about the water services Bill two weeks ago on the Order of Business, although I understand the Taoiseach is examining it. Now the Legal Services Regulation Bill 2011 is back before us without any proper consultation. The water services Bill was guillotined on Committee Stage, which I think set a precedent. This is the transparency, openness and honesty that we were promised by the people on the Government side of the House when they were on these benches. It is a total sham, but the people know that now. They are eagerly waiting for them in the long grass. They will wait as long as they have to, but by God will they get them.

We are now discussing this Bill and our Whip, Deputy Murphy, has written to the Taoiseach about the regulatory impact assessment for the Bill, so that we can have an informed debate about it. The Taoiseach wrote back and said that in an ideal world, an RIA is best completed in tandem with the publication of the Bill. We do not have an ideal world and we do not have an ideal Minister either. I said last year that he should be Minister for job creation. I think he created 45 or 47 jobs in this Bill in one hour before Christmas. I said he would meet them all at Christmas time in a State car and give them Christmas boxes as some of them were his friends. There was no frost this year so he could safely drive, and he could even have worked around. It is a pure mockery of the legislative system to bring this Bill before the House without any impact assessment. It has been going on in every Bill. The arrogance of getting into power with such a huge majority has gone to their heads. They think they can do what they like and disrespect us over here, and a Ceann Comhairle who aids and abets them is unfortunately being biased.

I cannot say anything about the Ceann Comhairle. I am sorry. I withdraw it. Deputy Buttimer is here.

On a point of order, could I ask the Member opposite to withdraw the remark about the Ceann Comhairle?

It is unfair. He should not do that. He showed complete disrespect to the House.

The Deputy is good at that himself.

Thank you for withdrawing your remark.

I am disappointed the Deputy did not get the heckler of the year award last year, but he will get over it. He got it for a few years.

The Government is putting an institution in place to regionalise water services and it is will have an impact assessment afterwards. The Minister for the Environment, Community and Local Government will have a consultation period in a couple of weeks, even though the Bill will be passed on Thursday. What kind of Government is this? How do we expect the public to have any respect for us if we vote for a pig in a poke and vote for something we do not know? This might have happened in countries without a democracy, but these Ministers have a huge dose of arrogance and a huge dose of disrespect for the democratic process. They are bringing Bill after Bill before the House and they are telling us we will discuss it afterwards with the stakeholders.

I know the Minister opposite, Deputy Shatter, is a new Minister and I wish him well. I voted for his Government, in fairness, but I regret it already. How long has this Bill been lying around in the Department? Have the senior officials examined it? Why could they not have the regulatory impact assessment ready with it? They make excuse after excuse, but it is just not acceptable. It is not good enough that we are expected to discuss legislation when we have not had proper, decent advice, and a consultation process carried out with the relevant stakeholders. There are many of them here, such as the Law Library and the Bar Council, and many of them are friends of the Minister.

This is a sham and a scam. It is a far cry from the transparency, openness and good governance that Government Members claimed they would bring. They have become nothing but lapdogs for the EU. They are summoned there every week and they will say "yes sir", "how much sir?" and "how many bags full sir?" They made it worse then when they were found out last week. The troika believed the Government had a mandate for this. It has no mandate for many of the Bills it is bringing in here. It is time the Government respected the other Members in this House and the electorate. I wish the Minister a safe journey to the Bundesbank tomorrow. I hope he brings the green jersey.

I would like to share time with Deputy Buttimer.

I warmly welcome the spirit of the Legal Services Regulation Bill 2011. However, I draw the Minister's attention to section 8 (2) (a), that stipulates that the 11 members of the authority will be appointed by the Minister. This does not correspond to the make-up of similar regulatory bodies. For example, the Teaching Council Act 2001 prescribes for approximately 62% of teacher council members. I ask the Minister to review this section and allow for the incorporation of stakeholders.

I am disappointed that no provision was made in the Bill for the establishment of limited liability partnerships similar to those in England, wherein all solicitors in a firm have limited liability. I recommend that the legislation include a provision requiring the authority to investigate the possibility of providing the legal framework for their creation, taking cognisance of best practice abroad. This would undoubtedly reduce solicitor cost and client fees.

I am particularly interested in the changes proposed in the training and education section. The Bill allows other bodies to be accredited by the authority to provide the training services currently monopolised by the Law Society and the Honourable Society of King's Inns for solicitors. This is a most welcome change to current practice. I cannot help but feel that law students in some regards are currently being exploited. The number of students sitting the FE1 examinations has risen significantly in recent years. For example, in 1995 there was one single sitting of FE1 examinations for 251 candidates. There were two sittings in 2005, one in April and one in October, with 1,499 students sitting exams in April and 1,548 sitting the October exams. In 2010 these figures dropped to 1,121 students who sat the April examinations and 987 who sat the October examinations. The examinations are costly, at €110 per exam, and each candidate must sit and pass eight FE1 examinations in total.

The number of solicitors qualifying does not reflect the number of students who sit the examinations, even accounting for a percentage who may be unsuccessful. In 2005, 420 qualified as solicitors; in 2010 the number was 725. However, these numbers do not add up. One can only conclude, therefore, that a sizeable number of students completing their FE1 examinations cannot acquire an apprenticeship placement. This is very unfortunate and difficult for the students concerned as FE1 examinations cost a student a total of €880. No grant or subsidy is provided for them and the qualification gained on completion of the FE1 examination is recognised only by the Law Society.

In this regard, I welcome the requirement placed on the authority to investigate arrangements to facilitate the minimisation of duplication and consequent expenses incurred by a candidate in the taking of examinations in legal subjects. The current system is not student friendly. I look forward to the reports from the authority in this regard and, moreover, action being taken to ameliorate the position.

I welcome the opportunity to speak to the Bill, about which I have spoken to the Minister on a one-to-one basis on several occasions. To be honest, there is anxiety about it and I do not think it is a fear of change on the part of the profession either in the Law Society or the Bar Council or among their representative members. It is not an anxiety we can dismiss or leave aside.

From speaking to the Minister, he is open to suggestions and being constructive. The legislation has been lying around for 30 years; therefore, it is not being taken up on a whim. It is certainly not the intention of the Minister to override a profession for the sake of it. It is welcome that he is being constructive in that the many suggestions being made by members of the Bar Council and the Law Society will be duly considered and examined in a very proactive way.

There are fears about independence, which I am confident the Minister will allay as the legislation goes through the Houses. There are concerns about who will administer the €50 million compensation fund. The Minister has stated the Law Society will continue to be the arbitrator with regard to the fund as it pays into and administers it. The fund shows the competence and co-operative responsibility of the profession in dealing with odd cowboy or cowgirl, which there is in every profession.

I encourage all solicitors and barristers to make submissions. People should not rely collectively on the representative groups to make submissions. Plenty of individuals have good ideas and proposals which they should put forward.

With regard to the new body being established, it is important that we continue to have a filtering system which uses the years of expertise and in-depth knowledge of solicitors and barristers. From speaking with the Minister, I have no doubt that a mechanism will be created to allow for this.

Having spoken to a few people in my county, I have a particular concern which I hope the Minister will be able to allay. It is with regard to the proposal that solicitors may employ barristers. I know this is qualified by the use of the word "may", but we could end up with a premiership-elite legal system under which the top law firms employed the top barristers. This would have a knock-on effect as the top barristers would be cherry-picked by the top solicitor firms and those solicitor firms not in a position to compete because of the levels of remuneration or wages offered would end up as part of a two tier system. I draw a parallel with soccer clubs across the water where the top four or five clubs have the reputation and money to buy the top players. In this cherry-picking system the other clubs are at a disadvantage. Perhaps the Minister thinks there is nothing to be worried about, but further down the track a firm such as Arthur Cox would be in a position to employ the top barristers, while smaller firms would not be able to compete at that level. It would also create a perception, as in advertisements solicitors would be able to state they had such and such a barrister with such and such a reputation and experience which would place them at a comparative advantage.

A conversation is taking place among the law fraternity about the fact that it is difficult for young barristers trying to come through the system. It is a difficult profession in which to be involved. When conveyancing was at its height, it was a different world, but this is a different time and it is time for change. This change will bring certain opportunities, but it is important to keep perspective. The real issue is independence and, as the Competition Authority mentioned, providing the consumer with a voice. I do not state consumers did not have a voice, but this might have been the case in certain quarters.

I welcome the Minister to deal with this very important legislation, the title of which includes the words "legal" and "services". I commend the Minister for bringing the Bill before the House and his willingness to engage with Members. Deputy Joe McHugh was correct to state there was anxiety among members of the legal profession, but I know the Minister is willing to engage and listen to all sides of the debate, which is how it should be. I hope this applies across the board.

I do not have a vested interest in the legislation, as I am not a member of the legal profession and do not desire to take silk. I speak as an ordinary Member of the House who wants to see change and reform. Beginning with this premise, most reasonable people want to see change in the legal profession. Confidence has been eroded in the legal profession for a variety of reasons one of which is the costs and length of the tribunal. The practices and procedures of the legal profession have not evolved to the same extent as those in other sections of society. We have seen a significant increase in the number of complaints against legal practitioners which has been to the detriment of the public and the majority of honest, law-abiding citizens and practitioners. The legal profession, in the main, carries out great work and is very accessible but there is a desire for change even among those in the profession.

I welcome the objectives the Minister has set as the bedrock of this Bill. It is important, in terms of our legal services and system, that we have confidence in the profession, that consumer interests are at the centre of the legal services market and that we have an open and transparent regulatory process.

I am open to correction but I am concerned that many people outside the legal profession see it as being elite, out of touch and beyond the reach of many because of the high fees charged. I hope that perception will be changed as a result of this Bill and that we will restore confidence, restore morale among the practitioners and make essential legal services accessible.

The current model of regulation in the legal profession is an outdated version of self-regulation. The main lesson we should have learned from the financial crisis in the banking system and from every other systemic problem we have come across is that self-regulation and light touch regulation does not work and is not in the interests of the wider society. Vested interests cannot and should not be permitted to act as both advocates and regulators of the same group. It has not worked, does not work and will not work in this case either. I hope this Bill will end that era of self-regulation.

I very much welcome the Minister's proposals to establish the legal services regulatory authority. Despite all of what we are hearing, that body must have regard to protecting and promoting the public interest and the interests of consumers regarding the provision of legal services, and promote competition in the provision of legal services. That is a welcome move which will assist in re-establishing confidence in the legal profession.

We must examine the issues of access and outdated practices, which have not evolved to the same extent as in other sections of society. Restrictive practices which prevent direct access to barristers, force clients to instruct the number a barristers and require clients to pay junior counsel two thirds of what the senior counsel is paid do not operate in the interests of justice but in the vested interest of the professions. I welcome the proposals in the Bill to do away with restrictive practices and make it easier for people to access legal services.

The changes are in the interest of consumers but they are also in the wider interest of the profession. Abolishing these practices has support among lawyers. I note that a former Chief Justice, Mr. Ronan Keane, has expressed support for some of these changes. However, as Deputy McHugh stated, concerns have been expressed about the Bill by members of the profession. I have been contacted about it also. Many solicitors and a number of barristers have contacted me to express concerns about some elements of the Bill. They are concerned that the proposals will vest too much regulatory power in the Minister and that the independence of the legal practitioners will be undermined. We must pay close attention to those concerns. We must ensure we do not undermine the privileged lawyer-client relationship which is fundamental to our system of justice and to the fairness inherent in it.

Equally, we must distinguish between the independence of the lawyer-client relationship and who is responsible for regulation. Government is elected by the people, despite Deputy McGrath's utterances, to implement legislation, which includes establishing mechanisms for regulation across the legal, financial, health and other sectors. While it is expected that certain interests will be opposed to the proposed changes in regulation, that does not make them wrong. Regulation is essential but it must operate in the wider public interest, and I am sure the Minister agrees with that principle.

The Bill proposes fundamental changes to our legal services. Essentially, it proposes to establish a new legal order and do away with a system that has been in place for a long time. The reasons that is necessary are, in many cases, because of erosion of public confidence but also because of an increased number of complaints, the difficulties faced by many lawyers practising in small country offices, and to fulfil requirements under the EU-IMF deal which is contained in the Bill.

It is important that the new system being proposed has the full confidence of the public, Members of this House and the legal profession who will work every day in that system. It is important also that we proceed carefully with this Bill and that the Minister and the Government continue to engage not just with vested interests but also with those who express deeply held and legitimate concerns. We must work to determine if the concerns can be addressed in this legislation and that it can, if necessary, incorporate some changes at a later date.

We must not deviate from the intent of ending self-regulation and restrictive practices which do not operate in the interest of the consumers of legal services. I commend the Minister on his approach and hope he will continue to listen.

Reducing costs and enhancing transparency are important and welcome reforms. However, the creation of additional quangos that may infringe upon the independence of the legal system is a dangerous development. An ever more complicated complaints system when a ready-made office, that being the legal services Ombudsman, already exists on the books to deal easily with complaints adds another unnecessary bureaucratic layer.

Fianna Fáil welcomes significant parts of the Bill including those that introduce greater transparency and will make it easier for young people to qualify as either barristers or solicitors, thus ending the monopoly the Law Society of Ireland and the King's Inns have in the training of both branches of their profession.

The introduction of greater transparency is a welcome move that will allow free information on costs that should help reduce costs and allow consumers to gauge value for money. However, there is a number of problems with these reforms and a series of measures are needed to strengthen these provisions.

The proposed Bill also gives rise to a number of areas of concern which yet again reveal that the Fine Gael-Labour coalition is performing more U-turns on its pre-election promises. This is particularly evident in the proposal by the Minister, Deputy Shatter, to establish two new quangos entitled the legal services regulatory authority and the legal practitioners disciplinary tribunal. That threatens competition and access for people to high quality legal services.

Fine Gael and Labour came to power promising they would cull quangos. Fine Gael pledged to abolish 145 quangos in its document, Reinventing Government. The programme for Government committed to reducing the number of State bodies. Notwithstanding that commitment, the Minister, Deputy Shatter, is proposing to establish two new quangos. First, the legal services regulatory authority will be required to regulate the entire legal profession. Such a quango will be both large and costly. To carry out the functions of the Law Society and Bar Council it must be heavily staffed. We should make no mistake that this quango will cost the State money. The Minister has indicated that it will be paid for by the legal professions. The experience of other quangos is that, ultimately, the cost will be passed on to the consumer.

Fine Gael and Labour are in denial and are misleading people by saying this quango will not cost the taxpayer money. It would be more appropriate if the Bar Council and the law society would carry out their regulatory functions and be supervised by an independent statutory authority. That would be less costly and more efficient. It is a system that is used in the United Kingdom and in other jurisdictions.

The second quango, the legal practitioners disciplinary tribunal, is a quasi-judicial body which will preside over alleged cases of misconduct referred to it by the legal services regulatory authority. Cases are brought to the tribunal having been referred to it by the complaints committee of the authority. Effectively, the tribunal and the authority complaints committee will replace the existing internal disciplinary procedures, namely, the Barristers' Professional Conduct Tribunal, the Professional Conduct Appeals Board and the Solicitors Disciplinary Tribunal. The creation of the tribunal also renders obsolete the Legal Services Ombudsman Act 2009, which this party introduced, and having a single statutory independent body to deal with complaints. The Fianna Fáil Bill was similar to the UK model, which has been rejected by the Government in creating this legal services authority rather than an oversight body, as is the case in the UK.

The Deputy has 16 minutes remaining and will be in possession when the debate on the Bill resumes.

Debate adjourned.