On 8 January 2021 the Civil Justice Council announced its consultation on the Guideline Hourly Rates. You can find more information about the consultation and how to have your say here.
It is now more than 10 years since the Guideline Rates were last reviewed and there is a growing body of case law which recognises that they are now outdated. The Table below shows the current guideline rates against the rates adjusted for inflation against the rates currently proposed by the CJC:-
|Guideline Rate (Band 1 / 2)||Guideline Adjusted for Inflation||CJC Proposed Rate|
|A||£217 / £201||£280 / £260||£261 / £255|
|B||£196 / £177||£253 / £228||£218 / £ 218|
|C||£161 / £146||£208 / £188||£178 / £177|
|D||£118 / £111||£152 / £143||£126 / £126|
So it seems that the recommendations will blur the line between National Bands 1 and 2, perhaps in part to take into account the greater flexibility afforded by communications technology. However, the recommendations fall short of bringing hourly rates to the levels they would have been if they had increased in line with inflation.
It is also notable that the proportional increases are highest for the top Grade and lowest at the bottom (a 20.2% increase for a National 1 band A against 6.8% for a National 1 band D), but when compared to the 2010 Guideline Rates the CJC Recommendations represent a real terms cut to hourly rates from their 2010 levels of up to 20%:-
|2010 Guideline Rate||CJC Proposed Rate in 2010 money||% reduction|
|A||£219 / £201||£198 / £193||10% / 4%|
|B||£196 / £177||£165||16% / 7%|
|C||£161 / £146||£135 / £134||18% / 9%|
|D||£126 / £126||£95||20% / 15%|
Any increase to the guideline rates is to be welcomed, as they are still commonly used as the starting point for consideration of the hourly rates. In reality, an increase to the guideline rates is likely to mean better recoveries for successful parties when costs are assessed. However, they do represent a real terms cut for all regional practitioners, especially those in urban centres and particularly at the more junior end.
Matthew Rose is a Solicitor in the Costs and Litigation Funding Department at Clarion Solicitors. You can contact him on 0113 222 3248 or by email to email@example.com