Summary of public section of the SRA Board meeting

Chair Charles Plant reported that the Board agreed it was very important that the SRA's two Midlands sites – at Redditch and Leamington Spa - should be brought together on one Midlands site at the earliest opportunity, to enable more efficient working. The SRA would continue to discuss with the Law Society the means by which this would be achieved.

The Board considered the revised strategy, which identifies the key priorities and high-level milestones for the SRA over the next three years.

The priorities (not in order of importance) identified are:

• to implement outcomes-focused regulation
• to deliver the SRA's Enabling Programme (which will bring improved business processes and technology to enable effective and efficient regulation)
• to move to a single site for the SRA's Midlands offices
• to build the SRA's reputation with the profession and consumers to become a recognised and respected regulator
• to be the ‘regulator of choice', when Alternative Business Structures come in, with firms choosing to be regulated by the SRA.

The Board agreed the strategy, with some amendments, including making it explicit that the SRA would be providing improved service levels. The revised strategy, with the operational plans to support it, will be brought to the Board in April.

The Board noted the end-of-year report, which included exception reports for any targets which were not achieved. The large majority of targets had been achieved.

The Board discussed a report on feedback to the consultation paper Moving towards a fairer fee policy.

The aim is to make the system fairer, including a fairer apportionment of cost between solicitors in local government, commerce and industry and those in private practice, with most of the regulatory activity of the SRA relating to the latter (60-80 per cent).

The Board heard that the changes were being made now as the Legal Services Act made it possible to shift some of the fee burden onto firms, and hence make the system fairer. Improved data on risk could be used in future to further develop the model.

The Board agreed in principle to the following elements of the proposed new fee model for 2010, but said that further work should be done to look at the detail, including the banding of the firm-based component, to ensure that firms are not penalised for being more efficient.

• There will be a firm-based component, calculated on the basis of turnover, through a banded approach (more work to be done on the banding), and based on the turnover figure captured in the 2009 renewal exercise.
• There will be an individual component, with 40 per cent of the total costs being allocated through the individual fee and 60 per cent through the firm-based fee. This 40:60 split is a starting point, and may change.
• The individual component will be a flat rate fee for all individuals across the profession, including all solicitors, Registered European Lawyers* and Registered Foreign lawyers* (*based in England and Wales) with a provision for a maternity reduction, and for RFLs based outside England and Wales to pay a reduced fee.
• The Compensation Fund will be funded through an individual and firm-based component. For 2010, the individual fee will be flat-rate for all individuals (including Government and in-house lawyers, as the Compensation Fund helps protect the reputation of the entire profession), and the firm-based fee will be a flat rate fee for all firms holding client money.
• There will also be a flat rate fee for each branch office based outside England and Wales.

The proposed model, with more detail, would come back to the Board next month. A further consultation paper will be issued on a transitional moderation process.

The Chair of each Board committee outlined the priorities and objectives for the next year.

The Board noted the update, and was told that the funding request to enable the continuation of the programme had been approved by the Law Society Council.