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LocalGovernmentLawyer The Legal Department of the Future February 2016 7 Going for growth Against a backdrop of further cuts to local authority budgets you might think that the vast majority of legal departments would be shrinking in size. But the survey found that almost exactly the same percentage of heads of legal 32 expect their teams to increase either slightly or significantly in size as expect them to stay more or less the same 35 or decrease slightly or significantly 31. Pursuing a growth agenda for a legal department at this time can be difficult however. One respondent notes that there is no political or management appetite for more lawyers in their authority and that lawyers are seen as blockers not enablers despite our best efforts. For others though the equation is simple more work undertaken in- house means more lawyers required. One head of legal cautions that extra posts will need to more than pay for themselves in extra income or saved external costs while another suggests that any growth in the number of lawyers will be for a fixed term to help the council deliver its agenda. Beyond that we are likely to have to bear the same level of cuts as other parts of the organisation they say. There is of course the previously mentioned challenge of filling posts in the most in-demand practice areas which heads of legal suggest are currently procurementcontracts planning property and child protection. How can legal departments compete with private sector firms in some of these areas for the best talent Pay rates available in local authorities mean we struggle to recruit in contractscommercial property teams acknowledges one head of legal. TCs in local authorities have stagnated in the recession and are now unappealing adds another. We need to do something to change this. The cutbacks to trainee posts during the recession are also said to have had a negative impact. Are fixed-term contracts which an increasing number of authorities appear to be offering part of the problem too particularly if there is no significant financial upside to compensate for the greater uncertainty One head of legal acknowledges that these deals are unpopular with candidates. This view is backed up by our experience of operating the Local Government Lawyer jobs board for the past six years where fixed-term vacancies attract significantly fewer views and applications than those offered on a permanent basis. In good shape The ability to reshape a legal department is a key part of the toolkit available to senior management whether the team is set to increase or reduce in size. In this respect more than a third of heads of legal 37 expect to use fewer locum solicitors and barristers going forward perhaps through the recruitment of additional permanent staff or the provision of extra capacity via shared service arrangements. This is almost double the number of respondents 19 who expect to use this pool of lawyers to a greater extent in the foreseeable future. Growth in staff numbers where it is happening meanwhile looks set to be at junior levels. Almost half of heads of legal 48 say they expect their numbers of paralegals to grow compared to 19 who expect them to fall. Similarly 32 predict that their cohort of assistant solicitors will increase while 23 believe they will fall. Reasons given for this include the attraction of growing your own improvements in technology and the increased use of workflows and standardisation to allow more transactional work to be carried out at a more junior level. The position is reversed however when it comes to senior solicitors with 19 of heads of legal expecting numbers to grow and 28 expecting them to fall. The situation is starker still at principal solicitorteam leader level where just 9 of heads of legal expect a growth in numbers and one in four 25 expect a reduction. In time this could present serious management challenges if there are limited opportunities for the junior lawyers to progress their careers. Controlling external spend A recurring theme ever since we started our research almost a decade ago has been the importance of controlling expenditure on external legal advice. Significantly the latest survey reveals that in many cases the relevant budget is not held by the legal team but rather by the client department which has to fund provision where the need is identified. This does beg the question of how much control is being exerted and whether full value is being extracted one head of legal admits that their council is yet to identify all external legal spend as some goes through the client direct. Fewer than one in ten of heads of legal 8 expect their budget for external advice to increase by more than 5 in the foreseeable future while more than half 54 expect it to fall by more than 5. We are looking to put work out only when there is a capability issue not a capacity issue says one respondent. More work undertaken in- house means more lawyers are required extra posts will need to more than pay for themselves in extra income or saved external costs. Fig 2