LSB calls for more work on plan that will force law firms to publish prices

20 June, 2016

Additional discussion and more evidence is needed before plans to make all law firms publicly publish their average prices can be backed, says the Legal Services Board (LSB).

Their announcement comes after a report from the Legal Services Consumer Panel (LSCP), which called on the Solicitors Regulation Authority (SRA) and Bar Standards Board (BSB) to commission mystery shopping exercises on the quality of legal advice at firms and force practices to publish their average prices.

The LSB said that “despite evidence of weak price transparency”, it felt the cost-benefit of official intervention to require publication of average prices needed to be explored further.

“It is not clear at this stage whether publication of average prices for particular legal services would be more helpful than misleading for consumers.

“Agreeing a methodology for these calculations could be challenging, while the collection of data and the actual publication of auditable/justifiable averages would create a burden for practitioners.

“Further discussion and evidence, including an assessment of the burdens on business and the practicalities of enforcing rules would be needed before the LSB could reach a firm view on this recommendation.”

The LSB added that research in the area of quality and pricing was “likely to be expensive” and would “only provide a snapshot in time for a small sample of practitioners”.

It said: “While they might gather evidence through mystery shopping and peer reviews in high-risk areas where it is cost-effective to do so, it is important to be realistic about the viability of such research as a routine tool for delivering consumer protection.”

In a letter to Elisabeth Davies, Chair of the LSCP, Sir Michael Pitt, Chairman of the LSB, said the issues raised by the consumer panel were “highly relevant” to the Competition and Markets Authority (CMA) study of the legal services market.

“We will revisit whether there is a need for us to take further action in this area once the CMA has published its findings and possible next steps in the summer,” he added.

Previous studies in to price transparency in legal firms has shown that the majority of practices do not publish average prices and fees publicly. This recommendation will be welcomed by the majority of solicitors, who in our experience prefer to keep their fees private.

Setting the right fee to meet the needs of your practice can be a difficult exercise, but with the assistance of Watson Buckle’s team of expert accountants and advisers the process can be made significantly easier and more effective. To find out more about our services, please contact us.