On 7th January 2021 the Legal Aid Agency announced changes to the civil legal aid eligibility criteria, to ensure that recipients of payments from specific compensation schemes are not disadvantaged when applying for legal aid. The announcement can be found here.
The rules concerning financial eligibility for legal aid are set out in section 21 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012. In order to be eligible for means-tested civil legal aid, an applicant must pass both the income and the capital eligibility test. There are certain payments that are disregarded from the calculation of disposable income, gross income and capital. The amendments (below) add further payments which are also to be disregarded from this calculation.
The changes are made pursuant to the Civil Legal Aid (Financial Resources and Payment for Services) (Amendment) Regulations 2020/1584. By Regulation 2(3), and with effect from 8th January 2021, there will now be a mandatory disregard for the following schemes when applying for civil legal aid:
By Regulation 2(6), there will also be a discretionary approach applied to the following four schemes, with effect from 8th January 2021:
Under the previous regulations, individuals in receipt of a compensation payment or any connected payment may have been considered over the capital threshold, thereby ineligible for legal aid. These amendments are designed to ensure that individuals who apply for civil legal aid are not disadvantaged by payments they have received as direct or indirect victims of incidences such as state error, violent crime, terrorism or national emergency.
Mortgage cap removal
With effect from 28th January 2021, the legislation also removes the existing £100,000 cap on the amount of mortgage debt that can be deducted from a property’s value, so that all mortgage debt will now be deducted when assessing a person’s capital. As a result, more applicants will pass the financial eligibility criteria when applying for civil legal aid.
Article by Sorcha Dervin, a Pupil at Farrar’s Building.