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Law Council of Australia


Federal budget must increase legal aid funding

4 May 2018

Opinion piece by David Neal SC.

Last year’s federal budget saw the commonwealth’s contribution to legal aid commission funding fall to its lowest level in 20 years. In 1996-97, the commonwealth allocated $11.55 per capita in real terms to legal aid commission funding. In 2017-18, that figure was $8.40. And there is worse to come.

The forecast for 2019-20 falls to $7.98. The figures emerge from a 2018 PwC report for the Law Council of Australia.

Up to the mid-1990s, the commonwealth government provided 55 per cent of legal aid commission funding. By last year, that contribution had dropped to around 32 per cent. This has been a massive cut.

PwC calculates that it would take an additional $190 million in this year’s budget to return the commonwealth’s share of funding to the 50 per cent level. That is near enough to doubling the $217 million that the commonwealth currently spends on legal aid commission funding.

From a distance, the disintegration of the commonwealth government’s commitment to legal aid funding is hard to understand. Equality before the law is basic to our political framework. But the foundation is shaky.

Unlike the commitment to universal healthcare expressed in Medicare, universal coverage has never been a reality for “Legicare”; legal aid never covered 100 per cent of the population and was always tied to a means test.

But did anyone imagine that — in a country like Australia — legal aid would only cover 8 per cent of the population? Or that Australia would spend half as much, per capita, as Britain does on legal aid? And that figure postdates severe cuts in 2012 by the British government.

By 2014, the financial squeeze on legal aid commissions had produced means tests which restricted legal aid to 8 per cent of the population. But 14 per cent of the Australian population falls below the Henderson poverty line.

Would it be too much to ask that at least all of those below the poverty line get legal aid?

The budget stranglehold cut even deeper with category exclusions on top of the means test exclusions. From 2008, legal aid commissions across the country began to exclude representation for people charged with criminal offences in magistrates courts unless they were likely to go to jail.

This has meant that thousands and thousands of defendants face criminal charges in magistrates courts without legal aid. The costs to the individuals concerned — to say nothing of the system costs of dealing with thousands and thousands of unrepresented defendants, and the follow-on effects to their dependants — far outweigh the costs of providing that representation.

Other category exclusions were implemented in family law cases and there is an enormous gap in legal aid for civil cases. This gap was highlighted by the Productivity Commission report in 2014.

Among other evils, this gap has shielded the malpractices by banks and other financial institutions from civil suits by people they have defrauded.

It is not as though the federal government has not been aware of these facts for a long time. Since the 1996-97 cuts, legal aid campaigners have made submissions to endless government reviews of the legal aid system, commissioned their own reports by expert economic analysts, and presented case studies to successive federal governments pointing out the injustices in these arrangements and the economic benefits of investing in a well-functioning legal system.

In 2012, the Law and Justice Foundation published a massive Australia-wide survey on legal needs which documented dire problems: 50 per cent of the respondents had experienced one or more legal problems in the preceding 12 months and 50 per cent of the problems had moderate to severe impacts on their lives.

In 2014, the Productivity Commission identified the parlous state of legal aid in civil matters and recommended an immediate funding increase for civil legal aid. Later this year, the Law Council will publish The Justice Project Report which will document the plight of 13 groups with acute legal needs.

There have been enough reviews and economic justifications. No more reviews. The evidence is in. Funding is the issue. The starting point is an additional $390 million. This has two components.

First, an additional $190 million. This is moderate given that it would only return the commonwealth to its previous 50 per cent share of base funding.

In addition, there is a need for another $200 million as recommended by the Productivity Commission for civil legal aid. This would be shared: $130 million from the commonwealth and $70 million from the states and territories.

For years now, these pleas have fallen at the altar of the federal budget deficit. Clearly now, given the “humungous” $4.8 billion lift in tax revenue, the commonwealth government can recommit to the reality — not just the ideal of equality before the law.

So in next week’s Budget, Mr Treasurer, just write a cheque.

* David Neal SC is co-chair of the Law Council’s access to justice committee. This piece was first published in The Australian on 4 May 2018.



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