The Legal Services Commission is experiencing ‘significant delays’ in processing payments to firms after administrative blunders affected thousands of criminal case files, the Gazette has learned.

Payment problems have occurred in relation to 4,000 files which were not allocated the necessary reference by HM Courts Service (HMCS) as the cases were moved from magistrates’ courts to Crown courts.

Without these references, the files do not tally with providers’ means assessment and appeals tool (MAAT) numbers, meaning that the LSC has been unable to process payments in the usual timeframe.

Providers have also been told that even where HMCS has now provided a reference number, the LSC has still been unable to make payments due to software problems.

Last week, the LSC set up a special process for firms owed more than £10,000 in legal aid fees that are facing ‘financial hardship because of payment processing issues’.

The arrangement applies to litigator fee claims for work in the Crown court ‘and is available for the minority of claims that are affected’.

To receive any payment under the process, it is necessary for providers to show ‘evidence of hardship’ to their relationship manager.

Hugh Barrett, executive director of commissioning at the LSC, said: ‘We regret that for a number of Crown court cases, significant delays in payments have occurred.

'The LSC is working closely with HMCS to remedy this matter urgently… We appreciate that the delays in payments may cause cashflow issues for some of our providers, and that is why we asked them to inform us of this fact so we can prioritise payments to these firms.’

Barrett added: ‘Excluding these cases, we are currently paying bills submitted to the LSC well within our eight-week target, at around three weeks on average.’

'An HMCS spokeswoman said there had been ‘initial difficulties’ relating to Crown court means testing, but it was ‘working with courts to address any training issues and will continue to work with the LSC to ensure that affected cases are dealt with as a matter of priority.’

A Law Society spokesman recommended that firms should seek recovery from the Courts Service for any loss suffered.