The head of a Birmingham chambers has warned legal firms to adapt and survive as radical proposals to shake up the legal aid system were unveiled yesterday.
Unveiling his proposals, Government trouble-shooter Lord Carter of Coles said they would stop lawyers earning "unreasonable" sums from the public purse and mean the end of the £1 million-a-year defence barrister.
Lord Carter said his wide-ranging package of reforms would save £100 million a year from the criminal legal aid budget, so it could be redirected to cash-starved civil and family work.
But he confirmed his proposals would not lead to a fall in the overall legal aid budget.
Legal aid currently costs £2.1 billion a year, or £100 for every taxpayer in the country.
The Government announced it would act as quickly as possible to put Lord Carter's report into action in England and Wales.
Jonathan Fox, chief executive of Birmingham-based St Philips Chambers, said the proposals would hit those practices which failed to accept the need for change.
"There are many firms that will benefit from a system of best value tendering, but those will be the forward-thinking organisations that already have procedures in place to adapt quickly to the changes. The legal profession is traditional in nature and there are a significant number of firms that either haven't recognised the need for change or have failed to keep pace with the market," said Mr Fox. "Firms that still rely on clunky outdated systems will simply fail to win legal aid work in this new era of tendering, which could see them go out of business.
"The legal landscape is changing dramatically and, hot on the heels of the Carter Review, we will see the next stage of the Legal Services Bill when the Joint Committee report is published on July 25.
"In this climate of change, providers of legal services have got to be prepared to adapt to survive. Law firms are definitely further ahead, but there is a real need for barristers' chambers to become more commercially aware."
Lord Carter's report appeared to indicate that nine out of ten barristers would actually earn more under the reforms.
Launching his 200-page review, the peer said: "We would like to see the end of the £1 million-a-year criminal defence barrister.
"To earn that amount of money I think you would have to do four weeks' work in one week.
"The existing system does permit people to make unreasonably large amounts of money.
"We believe the new system can actually find ways to constrain that."
Lord Carter said he had deliberately not taken steps which would have brought the greatest savings in the legal aid budget.
For example, he had rejected the idea of US-style "public defenders", under which people appearing in court have no choice over who brings their case.
"We believed we could not go there. We like the system we see and think it is working," he said.
"If we had only been interested in saving money, we could have gone down that route."
Lord Carter said he hoped his negotiations with the Bar had secured "agreement on the way forward".
But Bar Council chairman Stephen Hockman QC said: "I don't think that we feel we have a deal.
"But it is something which is worthy of discussion."
The Bar has been complaining about the fees structure for years and at one stage there were threats of a "strike" which could have crippled the criminal courts.
Kevin Martin, president of the Law Society which represents solicitors, said: "We need a system that is financially sustainable in the long term, and Lord Carter's proposals, if properly implemented, could offer that. But more work is needed.
"It is vital that fees are set at a viable level to achieve a sustainable system."
The Lord Chancellor, Lord Falconer of Thoroton, said he was acting immediately to bring in the proposals from as early as next April.
He issued a consultation paper which will aim to introduce the radical reforms "as quickly as possible", he added.