LSUC approves fee freeze as potential deficit looms

With the passing of the Law Society of Upper Canada’s 2016 budget on Oct. 29, Convocation has kept lawyer and paralegal annual fees at 2015’s levels.

It also debated the potential use of a $1-million contingency fund and ultimately agreed that if future projects eat up that money this year, Convocation would consider running a deficit to ensure the new initiatives move forward.

Audit and finance committee co-chairman Peter Wardle presented the 2016 budget, saying one of the main priorities was to keep fees as stable as possible. Wardle said those fees, based on budget projections for 2017-18, should remain the same for the next few years as more lawyers and paralegals begin to practise. Annual fees for 2016 will remain at $1,866 for practising lawyers and $996 for paralegals. Wardle said the law society has managed to keep fees under control, comparing them to British Columbia where the amount is $1,992 for lawyers or Alberta’s $2,620.

“Our base fees increase as the professions continue to grow and that growth, of course, also increases the demands on the law society’s resources,” said Wardle, noting the budget includes a two-per-cent provision for salary increases with the equivalent of about nine new full-time administrative staff positions created in the past year after two years of staffing reductions.

The budget projects revenue and funding of $110 million, up from a little more than $107 million in 2015, but with expenses of just under $111 million.

Benchers held a retreat earlier this summer where a number of future projects or initiatives to further such things as mentoring or access to justice were discussed. Wardle said the budget committee anticipates those initiatives would consume about $200,000 of the $1-million contingency fund in 2016 but would have a greater budget impact in 2017 and 2018.

“If any new initiatives arising out of the strategic planning initiative come forward to Convocation and are approved during 2016, the financial consequences of those initiatives during 2016 will be met by the law society out of the contingency or by running a deficit,” said Wardle.

That idea spurred some debate, with several members saying Convocation shouldn’t consider running a deficit. “It creates a dangerous precedent,” said Bradley Wright.

“I don’t think it’s wise to have a statement as part of our policy decisions today on budget to, in advance, say we will run deficit budgets,” he said. “It leaves the door open to a level of potential unaccountability and a lack of discipline in the budgeting process.”

Wardle said because those initiatives are still in the preliminary development stages and are far from coming to Convocation for approval, no firm costs could be included in this year’s budget. He added the contingency should be more than enough to ensure any initiatives that do come forward for approval will not be hindered financially in 2016.

In the end, Convocation agreed to proceed with approval of the budget as it stood, and any funds used on projects or initiatives beyond the $1-million contingency fund will be considered when they come to the table.

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