The Law Society has called for the Legal Services Board (LSB) to forget about regulating the legal market and begin downsizing.

The Society says most of the reforms in the Legal Services Act are now coming to fruition, with the establishment of a Legal Ombudsman and Solicitors Regulation Authority authorised to license alternative business structures.

Responding to the LSB’s strategic plan (2012-15) and business plan (2012-13), the Society says the LSB is showing no clear path to reducing its scope now its main duties have been carried out.

It suggests the language used in the LSB plans indicates an ‘inappropriately proactive’ approach for an oversight regulator. The Society says: ‘The LSB’s interest in acting as an economic or market regulator, in a similar way to the utility regulators of Ofcom, goes well beyond the purposes intended for the LSB.

‘The LSA envisaged the primary roles of the LSB in this area as being to ensure that approved regulators effectively separated regulatory from representative functions, and to ensure that the regulatory functions were carried out to an adequate standard.’

The response says it is ultimately for the market to create structures to offer whichever services they wish, overseen by front-line regulators.

It also says there is no need for the LSB to carry out further assessments of firms so long as the SRA meets this need. Overall, there is ‘considerably more scope for achieving economies’ at the LSB.

The LSB’s operational budget for the current financial year was £4.9m, which will be cut over the next two years. It has 30 staff members in Holborn, central London, plus nine board members and a chief executive.