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Conservatives hope to use their unexpected election mandate and what they see as the gift of Jeremy Corbyn as the opportunity for radical and irreversible reform of the welfare state. But the Government also intends to continue fiscal austerity. While budget constraints can inspire reform, change will founder if it is done on the cheap. The botched reform of family law provides a good example of this problem and also more evidence of the need for ‘clumsy’ solutions to complex problems.

In the last Parliament, various factors put legal aid provision for family law cases under scrutiny. Austerity meant that all departmental budgets outside protected areas faced significant cuts. Also, it was clear that the long standing requirement on lawyers and clients that the latter be referred to mediation before pursuing a legalistic route was being seen by lawyers simply as an administrative hurdle; only 1% of couples (as distinct from individuals) who divorced or separated went to mediation between 1996 and 2011. 

In April 2013 the government implemented legislation which massively reduced access to legal aid provision for court proceedings in most family law cases, while leaving legal aid for mediation in place. While this was hotly contested, the particular aim of encouraging clients to genuinely pursue mediation is a good one. There is evidence that mediation is both cheaper and more effective than going straight to court, with between 60 and 80% of all couples who agree to start mediation reaching an agreement. However, in pursuing deep cuts the reform has not only failed in its ambition to increase mediation but it seems to have created new social problems.

Because lawyers are insufficiently incentivised to take on legal aid cases in the first place the number of mediation assessments and starts actually fell significantly in the year following the reforms. And while the number has increased from its lowest point, the latest quarterly figures show that mediation starts are still at only 72% of the pre-cuts levels. This decline took government by surprise – in 2013/14, the Department of Justice underspent on mediation by almost £17 million.

Moreover, the number of people representing themselves in family law cases involving children rose by 19,000 in 2013/14. This slows down the legal process, increases court costs and is unlikely to lead to an agreed, fair and sustainable outcome. Most worryingly, a significant number of people who would previously have been going through court have disappeared off the radar of the legal system. It seems likely that this is resulting in some parents losing access to their children unnecessarily, or parents making agreements between themselves which may not provide sufficient protection for vulnerable or economically dependent parties.

Why has the policy failed? The specific problem is the unrealistic funding regime but, in trying to understand how this mistake could be made, three powers theory can help. As my regular reader will recall, three powers theory (based on cultrual theory) argues that there are three active ways of thinking about and pursuing change (solidarity, individualism, hierarchy), and that successful solutions to complex problems must combine them.  This isn’t easy because each power is in part driven by a critique of the others. Policy-making should thus seek solutions which combine the powers while holding them in creative tension, which is why theorists sometimes refer to such solutions as ‘clumsy’.

The government’s reform of family law certainly reflects its hierarchical goals, particularly achieving value for money. As MoJ Minister Lord Faulks said in a 2014 speech to the Civil Mediation Conference ‘the success of mediation and other dispute resolution methods in keeping unnecessary litigation out of the courts is a key cornerstone of an efficient and cost effective justice system’.

The policy also speaks to solidaristic, social value–based motives: mediation is less alienating than court proceedings; it has a high success rate; and it tends to result in more amicable resolutions. The government actively appealed to this perspective too; Simon Hughes (another Minister in the MoJ) argued that mediation can ‘keep families away from the negative effects that going to court can have’, and enable people to have ‘ownership of their agreements’.

However, there was a basic lack of realism in relation to individualistic motivations. Although in principle separating clients can go straight to legally aided mediation all the evidence shows that few have the inclination to do so. Clients will only consider mediation if their lawyer recommends it. But because under the new arrangements law firms can only earn £150 from a client signing up to mediation (plus a maximumof £200 for one side if a financial settlement is reached) law firms simply can’t make enough money from poor clients for this to be worth their while.

The system before 2013 was expensive and didn’t encourage mediation. The system post-2013 is cheaper but encourages even less mediation - while driving more people into self-representation and unenforceable arrangements. So what would a clumsy solution involve?

One answer would be a system in which legal aid lawyers’ fees were capped in family cases, where the financial incentive for lawyers to encourage and support client mediations was stronger and where a proper but simple system of monitoring would ensure that lawyers were genuinely encouraging full mediation rather than treating it as an administrative hurdle to access the courts. This reform would cost less than the old system but more than the new one and could achieve outcomes better than both.

By failing to address individualistic motivations the Government reforms have failed and in so doing generated new social problems. Thus three powers theory helps us identify a funding floor for reform. This is reminiscent of the classic welfare trilemma; you can have any two of the three big goals of targeting help to the poorest, incentivising work and saving, and reducing costs - but you can never have all three.

Fortunately the clumsy solution for family law is going to be tested. The social enterprise ‘Dialogue First’ has developed a model called ‘Lawyer-Supported Mediation’ (‘LSM’) which seeks to integrate the benefits of mediation with the commercial needs of lawyers and the clients’ initial desire for partisan support and advice. In the scheme employers – through their Employee Assistance Programme (EAP) – refer employees suffering separation to participating lawyers (law firms which have agreed to fixed and capped fees and being monitored for a high ratio of successful mediation outcomes). While government policy is failing, employers are stepping into the breach to try and secure better human outcomes. This is being driven by academic research published in 2014 showing between a third and a half of adults are at clinical risk of depression at the onset of separation with clear knock-on effects for well-being and productivity in the workplace.

If the experiment works, it could be applied to a reconstituted legal aid system. State backed lawyer supported mediation would cost more than the existing system but would still be considerably cheaper than the initial legal aid structure. Furthermore, a successful move towards mediation achieves other hierarchical goals such as more effective and legitimate institutions. Solidaristic motivations are still satisfied with the (previously rhetorical, now actual) move towards mediation, and the fixed low cost of LSM for clients is attractive for those concerned about universal access to justice.

Crucially, LSM also appeals to individualistic motivations by (a) incorporating the desire of individuals in difficult family circumstances to have a legal professional to protect their interests and (b) by giving law firms and lawyers a financial reason to promote this form of mediation at a time when traditional revenue streams have dried up.

Ultimately, the 18 month pilot of LSM which has just begun will be the test of how well it balances these competing worldviews. More broadly, this is a paradigmatic example of the importance of successfully developing clumsy solutions, and the human cost of failing to do so.



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