The Criminal Defence Services Act reintroduced the means-testing of legal aid for criminal cases. It took effect in the Magistrates’ Court in October 2006 and is expected to be introduced into the Crown Court at the end of 2007.

We only became aware of this legislation after it had been passed into law. To an organisation that spends a lot of its time working on the subject of poverty, what caught our eye about this legislation were the rules that determined whether someone would be eligible to legal aid. Money delivered via means testing, both as social security benefits and as tax credits, has been at the heart of this government’s attempts to defeat poverty by encouraging working-age adults into work and supporting them with state money when they are there. The in-work support available is especially generous for lone parent households.

Yet when we started to look at how the rules governing the means-testing of legal aid would impact on certain types of family, we quickly discovered that a lone parent with one child, working 40 hours a week on the minimum wage (£5.35 an hour) could be one of those people who would no longer be eligible for criminal legal aid. It is true that this lone parent only just fails the test of eligibility and that just small changes in circumstance could alter the outcome. Even so, it is an extraordinary conclusion.

We therefore looked further, using an official dataset on household incomes (the source among other things of the numbers on how well the Government is doing in reducing poverty) in order to work out some overall estimates of how many households are now no longer eligible for legal aid as a result of the means testing rules. Although such figures are always subject to some uncertainty, we estimate that around two-thirds of adults in working households and about a half of all adults in England and Wales (some 20 million people) are now no longer eligible.

What is striking about all this is how much at odds it is with the rhetoric that was used when the legislation was going through parliament. Then, to quote the phrase of the minister, Ms Bridget Prentice, during the Bill’s Second Reading, the target was those ‘well-publicised cases in which apparently wealthy individuals are able to claim legal aid’. Her ministerial colleague, Mr. Nick Ainger, went further. ‘On too many occasions’, he said, ‘those clearly able to afford the cost of their own representation and perhaps convicted of some of the most repellent and socially corrosive crimes are receiving the benefit of taxpayer's money through the legal aid system’. As examples of what he was talking about, he named a convicted murderer and a professional footballer accused of spitting.

There are several things about the way that means testing has been reintroduced into the magistrates’ courts that are troubling.

The first is whether this was what parliament intended. It is clear from Hansard that parliament did not object in principle to means testing for criminal legal aid. But there is nothing in the debate on the primary legislation to suggest that parliament knew that the implementation of means-testing would remove eligibility for legal aid from so many.

Part of the reason why this happened is the way in which legislation of this kind is enacted in two parts: the primary legislation covering the principle and the secondary legislation setting out the detail. In cases like this, where it is the detail that determines how many, and who, are to lose a right, or pay a charge, the two parts have to be considered together. It was during the scrutiny of the secondary legislation that the Government’s own estimate, that 46% of defendants would fail the test (a figure published in the Final Regulatory Impact Assessment) became clear. This seems as far removed from the original rhetoric as our own estimates are.

The deeper problem, however, lies with the type of argument which begins by identifying an ‘undeserving’ group who supposedly should no longer enjoy what was previously a universal right. Whenever such a claim is made – in this case about apparently wealthy individuals, especially if they have committed an odious crime –it must be subject to careful scrutiny and not just accepted as self-evident. Yet that rarely seems to happen nowadays, perhaps because we have become inured to the way in which individuals and groups are singled out by politicians and media. This parade of the ‘undeserving’ then provides a ready source of characters to play the part of the ‘enemy within’, against whom politicians can battle righteously, rather make the case on its merits. As happened here, once the principle is breached, it is then much easier to enlarge the group of people who will actually be affected as a result of the change.

This still leaves the question of why the regulations were implemented in a way that leaves so many people ineligible. That is not an inevitable consequence of means-testing. For example, the £10 a week ‘family element’ of the child tax credit goes to all but about 10 per cent of households with children, the cut-off for entitlement being a gross annual household income of around £50,000. If the Department for Constitutional Affairs had wanted to, it could have borrowed a really simple rule like this from HM Revenue and Customs. This would have had the considerable merit of producing effects commensurate with the case put forward for it.

The reason why it did not adopt a rule to exclude, say, just the richest 10 per cent is presumably because it would not have saved enough money. As it is, even when around half of the adult population is rendered ineligible, the Government estimates the saving to be £35 million a year. That works out at just £2 a head for every person we estimate to be no longer eligible – laughably bad value for money.

From the economic point of view, this is the essence of the argument against means-testing for legal aid. Certainly, the Government could amend the regulations in order to deal with the most embarrassing examples of people who are not eligible at the moment. But even if it makes these corrections, we do not believe it is possible to devise a means-testing scheme that saves much money without depriving large numbers of working people of eligibility to legal aid.

Peter Kenway
Director, New Policy Institute
www.npi.org.uk