The Legal Services Board: independent public bodies review

The LSB should take immediate steps to bring together relevant actors within the existing regulatory framework so that it operates more effectively in protecting and promoting the interests of consumers.
The LSB is uniquely placed to support system-wide alignment and integration of the existing regulatory framework – to reduce duplication, align regulatory approaches, strengthen proactive frontline supervision, minimise low-value administrative burdens, and improve sector-wide use of data and intelligence.

For the longer term, the MOJ should carry out a comprehensive review of the regulation of legal services with consideration also being given to what activity should sit within or outside the current regulatory perimeters. This new framework should be developed by 2029 with a view to implementing a future regulatory framework during the next Parliament, with the LSB and existing regulators working closely together in anticipation of a more integrated regulatory framework.
Given the uncertainty surrounding future legislative reform, the LSB and other regulators should not defer action in anticipation of structural change. Their focus should remain firmly on implementing the recommendations in this report and delivering improvement within the existing framework.

The LSB should reset its strategic purpose by directing most of its resources towards strengthening consumer protection through its oversight of, and collaboration with, frontline regulators and the OLC.
Informed by insight from the LSCP, this should be embedded within its business planning and reflected in its more targeted, proportionate, and risk-based approach to the oversight of frontline regulators and the OLC. LSB activity that cannot demonstrably support the effective discharge of its oversight responsibilities and, through this, consumer confidence in legal services should be stopped.

The LSB should strengthen its prioritisation, regulatory oversight, and articulation of intended outcomes by advancing the following three interconnected strands of work:

• A more proportionate and effective supervisory approach: the LSB should move towards a preventative, risk-based model that avoids unnecessary prescription and recognises the differing scale, role, and capacity of regulators.
• Greater system-wide alignment and integration of the existing regulatory framework: the LSB should use the full range of its tools to reduce duplication, align regulatory approaches voluntarily, strengthen proactive frontline supervision, minimise low-value administrative burdens, and improve sector-wide use of data and intelligence.
• Clearer strategic focus and accountability for outcomes: the LSB should articulate a clearer, single strategic narrative with stronger prioritisation, clear links between activity and delivery, and measurable outcomes and impacts. This should include how success, progress, and value for money will be assessed. This will strengthen confidence in regulatory effectiveness and oversight.

The LSB should undertake a review of its convening role, to ensure a more strategic approach using the full range of engagement mechanisms with clarity as to when it should exercise leadership, when it should convene and facilitate collaboration, and when it should enable others to lead. This should include:

• The LSB clearly separating its performance oversight role from its broader collaborative activities, with protocols to protect its independence. It should also be explicit about which role it is performing during any engagement to ensure clarity and maintain trust. In particular, the LSB should avoid adopting a default leadership position where its role is more appropriately to facilitate dialogue, build consensus, or support co-ordinated action by others.
• A review of the new Chief Executives’ Forum to assess its effectiveness in fostering meaningful engagement, enabling the escalation and discussion of key risks, and delivering tangible value to participants. This review should seek input from attendees which considers whether the forum is operating as intended, including its ability to support a co-ordinated approach to emerging issues. Clear ownership, accountability, and timeliness for actions arising from the forum should be established to ensure a stronger focus on delivery and outcomes rather than discussion alone.

The LSB, frontline regulators and MOJ should establish a shared framework for identifying, assessing and managing market and consumer risk across the legal services sector, including an agreed statement of sector risk tolerance, recognising that a zero-risk approach is neither feasible nor desirable.
The LSB should co-ordinate an annual assessment of key risks and regulatory mitigations, supported by strengthened horizon scanning, proactive intervention, and clearer articulation of consumer protection objectives and associated trade-offs relating to access, innovation, and growth. In doing so the LSB should draw on the expertise, intelligence and data held by frontline regulators, focusing on identifying cross-system risks, providing effective challenge, and promoting transparency and accountability across the sector. This annual assessment should then be shared more widely to support informed discussion of sector-wide risks and priorities.

The LSB should refocus its policy activity to ensure it is clearly aligned with, and limited to, its regulatory oversight role.
As part of this, a clear and shared delineation of policy responsibilities across the MOJ, LSB, and frontline regulators should be established and communicated to reduce duplication and stakeholder confusion.
The LSB should clearly demonstrate to the sector and key stakeholders how it translates its oversight policy into effective action and demonstrable outcomes, ensuring its work delivers tangible impact across the sector. In doing so, activity should be clearly aligned with the priority areas identified through this review, rather than being driven solely by broader policy development, to ensure focus and relevance in delivery.

The LSB should commission an expert review with regulators to assess how effectively the overall supervisory approach is working in practice, including statutory approvals and enforcement interventions. This review should include consideration as to whether the new RPA supports a proportionate approach, adequately captures key risks, and recognises that a one-size-fits-all model is inappropriate. It should also identify where longer-term efficiencies and reductions in regulatory burden could be achieved for both the LSB and regulators.

The MOJ should consider how it can increase transparency in its oversight of the LSB, including whether aspects of its existing assurance and accountability mechanisms could be made publicly available.

The LSB should strengthen its corporate governance by ensuring the board remains focused on strategic oversight, outcomes, and delivery, with a clear distinction between governance and executive responsibilities. A refined scheme of delegation and clearer articulation of matters reserved to the board would empower the executive team, promote organisational agility, reduce unnecessary board workload, and ensure clear accountability. As part of this work, the LSB should undertake annual BERs, including a full external review every three years, conducted in line with Cabinet Office guidance. This will enhance transparency and accountability both internally and externally, supporting effective oversight.

The LSB should urgently rethink its organisational design and rebalance its use of existing funding requirements to ensure it has the necessary capabilities, aligned to the recommendations in this review.