British Columbia's poor might soon have a tougher time getting free legal aid for their day-to-day struggles. Public Eye has exclusively learned the province's legal services society may have to shutdown its poverty law programs next year. The reason: according to an internal memo by society executive director Mark Benton, a higher-than-projected provincial deficit could threaten the agency's government funding for fiscal 2010/11, which was forecasted to be $68.5 million.
Thanks to ultra-low interest rates, additional funding from the Notary Foundation is expected to decline to "negligible" levels. And those rates could impact monies from the Law Foundation of British Columbia.
As a result, last month, the society's board "determined that civil services will require additional funding to continue next year."
Society communications manager Brad Daisley confirmed the term civil services refers to poverty law programs that provide information and advice on everything from housing and income security issues to health and employment law. But he declined to say which specific programs would be affected, noting, "budget and funding decisions have yet to be made."
News of the potential cutbacks prompted the association representing trial lawyers to call for the restoration of the society's government funding, which stood at $88.3 million in 2001/02 before Campbell administration cutbacks.
"The true measure of a whether we live in a just society is not how much we talk about protecting the poor and the weak, but rather what actions we take to ensure it," said association president Robert Holmes.
"It is clear that we are doing less and less to protect the weakest members of society and that we are eroding justice as a fundamental value."
The following is a complete copy of the aforementioned email.
From: Mark Benton
Sent: July 16, 2009 3:42 PM
To: #All Staff Mail
Subject: Mid-July update
I want to give you all an update on LSS's finances, the recent board meeting and the development of the LSS service plan.
First, I would like to welcome one new board member. On Friday, the Law Society appointed Tom Christensen, the former Minister of Children and Family Development, who is returning to legal practice after several years in the Legislature, in place of Victoria lawyer Rick Schwartz. Tom takes up his duties in September and there will be a special "thank you" for Rick at the next board meeting. The Law Society also renewed the appointment of Vancouver lawyer and board vice-chair David Crossin, QC.
I expect three additional appointments by the provincial government later this summer to replace Larry Goble, Bruce Hardy and Geoff Cowper, QC who have all completed the maximum term as directors. Janice Comeau's replacement is expected in November when she completes her sixth year on the board.
The board met on Monday to review LSS's current financial situation and its implications for our future.
They heard from Catherine McNeil and Eugene Wandell that LSS's fiscal circumstances are improving thanks largely to a downward trend in criminal tariff expenditures. In the first two months of the this fiscal year, the number of referrals in each of criminal, family, CFCSA and immigration was down slightly from what we had budgeted and down considerably from the same time last fiscal.
Meanwhile, our financial projections suggest the family tariff will end the year over budget due largely to extended family service referrals authorized in previous years that have yet to be billed. The criminal tariff is, however, expected to come in under budget and, assuming our financial projections do not change, this is a more positive financial picture for this fiscal year.
Also assisting LSS to meet its budget targets are the efforts of all LSS departments to find $1 million in savings for this fiscal year. For example, careful review of all contracting expenditures and travel costs will result in savings.
This does not mean our financial challenges are over. Ultra-low interest rates - which are projected to last for the foreseeable future - mean revenue from the Notary Foundation, and other interest-based revenue, this year and next will be negligible. The Law Foundation has a large reserve fund so its funding is presently stable, but as its interest revenue declines the Foundation's reserve fund will be gradually depleted and LSS revenues from the Foundation could drop as well.
There is also considerable uncertainty for any organization that is funded by government. Although provincial finance minister Colin Hansen announced a small surplus for the last fiscal year, the deficit for 2009/2010 is expected to be significantly larger than the $495 million the government originally predicted. Some economists have even suggested as much as $2 billion. The government will be introducing a revised budget on September 1 and we will know more then. A higher-than-projected deficit will, of course, put significant pressure on government finances in fiscal 2010/2011 and corresponding pressure on the budgets of any government-funded agency.
Based on this information, the board made two decisions about LSS's fiscal future.
The first was a direction that EMC come back to the board in October with options and a work plan for a less expensive infrastructure for legal aid services. This will most certainly include plans for reduced administrative costs through much simpler tariffs and reduced costs in providing access to legal aid.
The second relates to the use of non-government revenues. Given the drop in LSS's non-government revenues (which are interest based) and the expected depletion of the Society's accumulated surplus, the board confirmed that non-government funds should be used to advance the priorities the board established at their April planning session. These priorities are: expanded aboriginal services, research and development to support legal aid innovation, family services, community development, PLEI and criminal services. The board (and everyone at LSS for that matter) recognizes that civil law programs provide valuable services, but in the current fiscal circumstances, the board has determined that civil services will require additional funding to continue next year.
The board also confirmed its commitment to an independent LSS and to working collaboratively with the Attorney General and our other justice system partners to ensure we fulfil our mandate.
As mentioned above, the provincial government will be presenting a revised budget on September 1. As part of the preparation, the government will be giving some Crown agencies new budgets in late July or early August for this fiscal year. At this time, I do not anticipate any changes to the LSS budget given that our budget has already been approved by the Attorney General.
In conjunction with the revised budgets, the government has also asked all Crown agencies to produce revised service plans by the end of August. Harold Clark, Kathryn Spracklin and the rest of the team are hard at work on this project and will have the revised service plan for the board's approval next month. The updates will reflect material changes to LSS's financial/operating environment that have taken place since the service plan was completed in February 2009. Given the short time line, there will not be any changes to the society's goals, strategies and performance measures.
Once that is completed, work will begin immediately on the 2010/2011 service plan. I suspect we will not have a good sense of the our 2010/2011 budget until the late fall or early winter and as a result our planning timelines for the next fiscal year will likely be later than usual.
I expect to be meeting soon with the new Attorney General, Mike de Jong, QC, to discuss these and other matters.
And finally, a thank you to everyone involved in the production of the 2008/2009 annual service plan report which recently arrived from the printer and will be posted on the LSS website soon.