CAROL COULTER, Legal Affairs Editor
ALL LEGAL services for the State should be subject to competitive tendering, according to the Public Accounts Committee.
The committee found, in a report on legal costs published yesterday, that the State spent up to €500 million a year on legal services, most of which are not put out to tender.
All accounting officers in State and public bodies should be informed of such a requirement, and the accounts of these bodies should provide the total amount spent on legal services, it said.
The report found that up to the end of 2010, the cost to the State of the Morris tribunal was €57.89 million, the Mahon tribunal €105.6 million and the Moriarty tribunal €41.39 million, with five barristers earning over €5 million each.
The committee recommended that the taxation of costs system be overhauled so that clear guidance is available to the public and legal professionals on current market rates for such costs.
Costs both to the State bodies and third parties should be decided in advance either by negotiation or through using court rules, it recommended.
The legislation governing tribunals of inquiry should be reformed along the lines outlined in the Tribunal of Inquiry Bill 2005, which followed recommendations from the Law Reform Commission.
It reiterated the recommendation of the Competition Authority in 2006 that restrictive practices in the two legal professions should be removed, and expressed regret that this had not been done and will now only be imposed through the IMF-EU Memorandum of Understanding, which requires such reforms by the end of the third quarter of this year.
The committee also reported that five of the barristers working for the Mahon (Planning) and Moriarty tribunals earned in excess of €5 million, with two of them earning almost €10 million.
Referring to the manner in which fees were negotiated and increased, justified on the grounds of a need for continuity, the report points out that legal personnel changed without tribunals collapsing, saying: “The committee finds it difficult to understand why a stronger line was not taken in 2002 in opposing increases in fees for tribunal lawyers.”
It described as “extraordinary” the fact that senior counsel at the Moriarty tribunal were paid for 304 days in 2008, when the tribunal sat in public session on average for 20 days for the past three years. It pointed out that the tribunal recorded attendance but not arrival or departure times. The Morris and Mahon tribunals did not have attendance records for their legal teams, it said.
The committee was critical of the Mahon tribunal for not releasing the two extra judges it sought, on the understanding they would sit in parallel sessions, when it emerged that this was not practical.
Referring to the legal services obtained by other State and public bodies, the committee expressed concern that taxpayers should not end up paying high and uncontrollable costs in relation to advice on Nama. It commented that there was a difficulty in establishing what the market rate for legal services was due to the absence of a transparent competition process.
It was critical of the fact that the procurement of legal services was exempted from the EC directive on the subject, and recommended that all legal services to the State should be procured in accordance with the 2004 Public Procurement Guidelines for competitive tendering.
Legal Fees Top Earners
Jerry Healy SC€9,490,181
John Coughlan SC€9,285,628
Jacqueline O’Brien SC€6,707,917
Desmond O’Neill SC€5,279,311
Patricia Dillon SC €5,591,889
Patrick Quinn SC €4,975,377