Housing associations cut legal spending
Nearly three quarters of social housing providers are expecting to spend less on legal fees in the next financial year according to figures from Inside Housing’s first annual legal fees survey.
The anonymous survey of 24 social landlords revealed that 72 per cent expected to cut spending on legal fees in 2010/11 and pointed to a growing trend of landlords negotiating much tougher deals with law firms.
Landlords have spent 34 per cent less on legal services since 2007/08 with spending dropping from £28.9 million to £18.5 million last year.
Landlords pointed to public sector cuts as being a driver for change; 71 per cent of respondents said that they expected government cuts to affect the amount they would spend on law firms.
Twenty nine per cent of respondents said public sector cuts had a ‘significant’ impact on their legal spending, a further 29 per cent said the cuts would not affect what they spend while the remaining respondents said the cuts would affect their legal spending either ‘slightly’ or ‘very slightly’.
Nearly a quarter of social landlords either have joined or will form consortiums to cut the cost of buying legal services.
Four housing associations, Metropolitan Housing Partnership, Peabody, Phoenix and Servite Houses have formed a legal consortium called the Housing Associations’ Legal Alliance which expects to save 20 per cent on legal fees next year.
Leo Fattorini, director of legal cost consultants Kennedy Carter Legal, said he had negotiated fee discounts of up to 50 per cent when setting up similar procurement clubs for local authorities.
For the full results see our legal supplement, free with tomorrow’s edition of Inside Housing.
