Posted on 29.03.2021

ACSO responds to the Civil Justice Council consultation on guideline hourly rates

The Association of Consumer Support Organisations (ACSO) has responded to the Civil Justice Council (CJC) consultation on guideline hourly rates (GHRs).

Matthew Maxwell Scott, executive director of the ACSO, said: "Given it has been 11 years since the rates were last increased, the CJC's review is necessary.

"A rise in the GHRs will reduce the gap between a consumer's legal costs on an indemnity basis and the legal costs that their solicitor will be able to recover from their opponent on the standard basis. This benefits consumers by lowering any shortfall amount that they may be liable to pay, as in many areas of law they have to pay the difference between their legal costs as incurred and the amounts recovered. Reducing this shortfall thus helps reduce barriers to access to justice.

"From a consumer perspective, it is important therefore that any increase in the GHRs realistically reflects market rates. To achieve this, greater consideration should be given to appropriate inflationary measures to ensure the GHRs properly reflect the rates charged to consumers."

Maxwell Scott also noted that care must be taken to ensure the GHRs for lower-Grade fee earners are revised upwards at a similar proportion to those at Grades A and B. This will encourage solicitors to allocate more Grade C and D fee earners to represent consumers, where appropriate, and will reduce the potential unintended consequence of reducing the amount of work undertaken at these levels because of the diminished margins available.

Maxwell Scott concluded by highlighting the importance of regularly reviewing and adjusting the GHRs according to an appropriate inflationary measure such as the services producer price index (SPPI). "Without regular reviews the gap between the solicitor/client costs on the indemnity costs and the between-parties costs on the standard costs may widen again, to the detriment of the consumer."

ACSO members can download the submission in full from the members' area of the website.