MR RICHARD SCHOFIELD AND MR EBEN BLACK

6 MARCH 2008

  Q474 Chairman: I want to welcome to our Committee meeting this morning our witnesses from the Law Society and from DLA Piper Global Government Relations. We have Eben Black who is Head of Media at Global Government Relations, which is part of the law firm DLA Piper. You were, in a previous life, with the Sunday Times and industrial editor at The Sun.

  Mr Black: That is right.

  Q475  Chairman: Richard Schofield comes to us from the regulatory affairs section of the Law Society, Head of Regulatory Affairs, but that regulation is moving, I believe, elsewhere in due course.

  Mr Schofield: Regulation has already moved to the SRA[11] in anticipation of the implementation of the Legal Services Act. My role is on the representative side of the Law Society dealing with representative issues.

  Q476 Chairman: Do either of you want to make a preliminary statement to tell us about law firms and how they are getting involved, and are involved, in lobbying and touch on some of the key issues that we should be aware of?

  Mr Black: I think law firms are becoming more and more involved in lobbying and the reason is we are moving into an area of full service essentially. The idea is that clients will not want a simple straight forward traditional legal service but want other things as well to take them right from the beginning to the end of a particular project. Because this is very much the American model, with American law firms moving into London in greater numbers, we will see very much more in the future.

  Mr Schofield: I agree with everything that Eben said. Obviously law firms have many of the skills you would associate with effective and skilled lobbying in that they have a lot of detailed expertise in somewhat arcane areas. Also they have relationships, particularly with the regulatory branches of government, which they have built up over many years doing transactional work and applying some of that skill and knowledge to a broader lobbying audience in a similar way to American firms.

  Q477  Chairman: Can you tell the Committee the effect that the Legal Services Act has had on the law firms engaged who want to go into lobbying?

  Mr Schofield: The Legal Services Act itself will have no particular impact on that in that as now any law firm that engages in lobbying will be subject to the Solicitors' Code of Conduct and the full regulatory framework governing the profession, and the Legal Services Act will continue that. There will be developments around entities being regulated as well as individuals and firms where you might have people practising more than one discipline but that is more about how the entities are owned and managed rather than whether or not they will be regulated. They will continue to be regulated in a similar way.

  Q478  Chairman: Am I right in thinking that law firms will become multi-disciplinary? They could act for people drawing on the expertise of a multiplicity of experts and that is a step change, is it not?

  Mr Schofield: Yes, it is, but what the Legal Services Act is permitting is more around the ownership of law firms and who is allowed to be engaged in the management of them. Law firms now might well employ accountants, tax advisers, some even employ barristers, but those people are not allowed to own and are excluded from certain parts of the management, particularly the financial management, of the organisation.

  Q479  Mr Walker: I am quite interested in the growth of lobbying within law firms. As you know, in the US law firms do a lot of lobbying; in fact lobbying in the United States is probably far more professional than it is over here for that reason. One of the problems with lobbying is actually that it commands very low cash premiums compared to other forms of advice. Lobbying companies, when you compare them to lawyers, barristers, people working in the financial services sector, tend to charge much smaller fees. Is it really not the case that law firms are eyeing this up as a very lucrative way of charging £1,000 an hour fees not just for legal advice but also public affairs advice as well? It is quite a lucrative market for you to be in.

  Mr Black: I would say that our fee structure for the public affairs side of things is different to the legal structure. One thousand pounds an hour is not exactly the amount we are talking about here.