Government proposals to reduce the number of criminal law firms have not deterred new firms from setting up, according to specialist legal aid consultants.

Simon Pottinger, founder of JRS Consultants, predicted that the number of firms with a criminal legal aid contract is likely to have increased rather than diminished following the latest tender exercise, due to the emergence of new small firms coming into the market.

He has advised several new sole practitioner and two- or three-partner firms which are about to open up in West Yorkshire and the north-east, after being awarded contracts.

‘These are duty solicitors who have been associates in other people’s firms and now want to set up their own business,’ said Pottinger. ‘Instead of working hard to get 50% of the fee themselves, they see the opportunity to make more money on their own,’ he added. ‘They are taking an entrepreneurial risk’.

In other parts of the country, Pottinger said existing firms have also opened new branch offices in order to gain work in new areas.

‘Nobody we know has decided to pull out of the publicly funded criminal market,’ he said.

David Gilmore, founder of DG Legal, said he had advised 11 criminal law start-ups which bid for contracts in the recent tender exercise, also ranging in size from one to three partners.

‘The government and the LSC have tried on a number of occasions to reduce the number of criminal firms, but abandoned their plans,’ he said. ‘Despite the proposals to reduce the market, outlined earlier in the year, I don’t think the profession is entirely convinced that major reform will happen.’

Gilmore added: ‘The proposals do not seem to have put people off starting up new firms.’

An LSC spokesman said that all applicants involved in the criminal tender process have now been notified of the outcome, including those which appealed against initial rejections. However, he said the LSC would not publish the number of firms with criminal contracts until the conclusion of ongoing civil tender exercises.