At the end of June 2017 we regulated 231 practices (233 in June 2016) with a combined turnover of over £214m (£198m in 2016). We also license 1,372 individuals as at June 2017 (1,323 in June 2016).
We only undertake regulation, and that accounts for all of our income and expenditure.
Income in 2016 and 2017
Regulated practices pay an annual fee to fund the work of the CLC and make a contribution to the Compensation Fund. Both are based on the firm’s turnover. Individuals also pay a fixed licence fee. Increases in the turnover of CLC firms allowed us to make a 20% reduction in practice fee rates in 2016 that will hold steady in 2017.
In 2016, total income was £3.5m.
In 2017, based on half-year results, we project that the total revenue received will be £3.3m.
Expenditure 2016 and 2017
The CLC only undertakes the regulation of specialist conveyancing and probate lawyers. We are not engaged in any other activity. Accordingly, all of our expenditure arises from our regulatory responsibilities, as overseen by the Legal Services Board. The CLC also pays levies to fund the work of the Legal Services Board, Office for Legal Complaints and Financial Conduct Authority. Our application of the funds received in 2016 and 2017 is set out in two charts below.
Income and expenditure will both be lower in 2017 than in 2016 as a result of the CLC moving away from the direct provision of education and the reduction in practice fee rates. Direct comparison between 2016 and 2017 is not entirely possible because of the changes to education, which has had some effect on the changes to the percentage share of funds for the CLC’s other activities. The activity categories are explained now.
Assessing first applications to be regulated by the CLC and managing licence renewals to maintain the high standards of the CLC community.
- Monitoring and Inspection
Routine and risk- or intelligence-based inspection visits to regulated practices, desk-based monitoring of compliance with CLC standards.
- Enforcement, Disciplinary and Interventions
Addressing non-compliance, active management of firms on the watchlist, including referral to the CLC’s Adjudication Panel and their proceedings as well as interventions to close firms where necessary for consumer protection and the related follow-up work.
- Standards, Policy and Strategy
Developing, communicating and maintaining regulatory policies and standards, promoting and supporting achievement of best practice. Setting the course for the CLC, taking account of the changing environment and legal market place and evolving best practice in regulation. Carrying out Research.
2016 was the last year in which CLC provided education to CLC qualifications. From 2017 onwards, the CLC derives no income from the provision of education, which had been undertaken on a cost recovery basis. Some costs remain in relation to the setting and maintenance of education standards and the management of the relationship with the awarding organisation, SQA, and the accredited education providers of CLC qualifications.
- Finance and Administration
Managing the resources provided by the regulated community.
Non-executive oversight and steering of the CLC’s work, including external and internal audit.
Payments made by CLC on behalf of the regulated community to fund the work of the Legal Services Board, Office for Legal Complaints and Financial Conduct Authority in respect of CLC-regulated practices.
- Compensation Fund
The fund of last resort for clients of CLC firms. Administered by the CLC on behalf of the regulated community.
- Practice Fund Reserve
An allocation to organisational reserves to enable the CLC to deal with unexpected demands on its resources from time to time.