Ministry of Justice (MOJ) Target Lawyers Client Accounts [Only Part]
Monday 19 January 2026 at 14:34
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Government Proposals on Client Account Interest
The UK Ministry of Justice has launched a consultation on an Interest on Lawyers’ Client Accounts (ILCA) scheme. Under the proposals, a significant share of interest earned on solicitors’ client accounts potentially 75% from pooled accounts and 50% from individual accounts would be remitted to the government to help fund the justice system. This would include reallocating funds that many firms currently rely on as part of their income.
2. PROFESSIONAL & PRACTICAL CONCERNS
Solicitors’ representative bodies and commentators warn that the plan could seriously destabilise the profession. Many firms especially small and high-street practices depend on client account interest to maintain cash flow, cross-subsidise low-margin work like legal aid, and stay solvent. Without this interest, firms may be forced to raise fees, cut services, or face closure. The Law Society has stated the proposals risk undermining firms’ financial health and ability to operate, adding compliance and administrative burdens.
3. BROADER IMPACT IF IMPLEMENTED
If enacted as currently drafted, these changes could shrink consumer choice, reduce access to justice, and accelerate the decline of smaller legal practices. While the government points to similar schemes abroad, critics emphasise that unlike in other jurisdictions, the UK scheme would funnel funds into general MoJ spending rather than dedicated access-to-justice purposes, raising both ethical and practical objections.
Ministry of Justice (MOJ) Target Lawyers Client Accounts [Only Part]
The UK Ministry of Justice has launched a consultation on an Interest on Lawyers’ Client Accounts (ILCA) scheme. Under the proposals, a significant share of interest earned on solicitors’ client accounts potentially 75% from pooled accounts and 50% from individual accounts would be remitted to the government to help fund the justice system. This would include reallocating funds that many firms currently rely on as part of their income.
2. PROFESSIONAL & PRACTICAL CONCERNS
Solicitors’ representative bodies and commentators warn that the plan could seriously destabilise the profession. Many firms especially small and high-street practices depend on client account interest to maintain cash flow, cross-subsidise low-margin work like legal aid, and stay solvent. Without this interest, firms may be forced to raise fees, cut services, or face closure. The Law Society has stated the proposals risk undermining firms’ financial health and ability to operate, adding compliance and administrative burdens.
3. BROADER IMPACT IF IMPLEMENTED
If enacted as currently drafted, these changes could shrink consumer choice, reduce access to justice, and accelerate the decline of smaller legal practices. While the government points to similar schemes abroad, critics emphasise that unlike in other jurisdictions, the UK scheme would funnel funds into general MoJ spending rather than dedicated access-to-justice purposes, raising both ethical and practical objections.
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