"While the Legal Services Commission has made
considerable progress, it still faces difficulties in reducing the
level of error in payments to legal services providers. The
Commission also needs to make significant improvements to the
quality of the data supporting the reported balance of outstanding
debt.
"In an environment of spending
cuts, the Commission will need to make difficult decisions on the
costs and benefits of further work to improve in these
areas."
Amyas Morse, head of the National Audit Office, 27
October 2011
The Comptroller and Auditor General, Amyas
Morse, has qualified the 2010-11 accounts of the Legal Services
Commission because of overpayments made by the Commission to legal
aid providers, estimated at almost £51 million.
The C&AG has also limited the scope of his
audit opinion in respect of the valuation of the receivables
balance, which is the debt owed to the Commission by people
receiving legal aid, and the related impairment provision (the
amount estimated to be non-recoverable). This is because the
Commission has been unable to provide sufficient evidence to
support the value of the recorded debt balance.
The Legal Services Commission is responsible
for the provision of legal aid in England and Wales through the
Community Legal Service Fund (for civil cases) and the Criminal
Defence Service (for criminal cases).
The NAO, as part of its annual audit of the
Legal Services Commission, identified an estimated total
overpayment to legal aid providers of £50.7 million in 2010-11;
this is down 34 per cent from an estimated £76.5 million in
2009-10. Of the estimated total error, £29.5 million were payments
made to legal aid providers working on cases which were eligible
for legal aid, but where legal aid providers over-claimed for the
work they did. The remaining £21.2 million of erroneous payments
were made to legal aid providers where legal aid had been provided
to claimants whose eligibility could not be demonstrated.
The Commission has made substantial
improvements in reducing the amount of overpayments made to legal
aid providers. These have resulted from an increased focus on
higher risk areas and enhanced assurance work. However, there is
still scope for further progress; and ongoing work to reduce
irregular payments will be made more difficult by the significant
cost reductions that the Commission needs to make.
Publication date: 27 October 2011