The collapse of not-for-profit immigration advice provider the Immigration Advisory Service (IAS) will leave thousands of clients without representation, the Law Society warned today.

IAS’s legal aid contract allowed it to take on 26,700 new cases a year.

It is not yet known what will happen to these cases.

IAS went into administration over the weekend.

It has not yet issued a statement, but there is speculation that the charity was unable to turn work in progress into revenue, because the Legal Services Commission does not pay firms until work is completed in immigration cases.

The delay in receiving payments can create serious cash flow difficulties for firms, as the Law Society and others have repeatedly warned.

One expert suggested serious questions should be asked about the LSC’s competence to monitor publicly funded organisations, given that it granted the IAS a significantly expanded contract only a year ago.

IAS is the second not-for-profit immigration advice service to go into administration in the past year.

The Refugee and Migrant Justice group collapsed in June last year, leaving 10,000 asylum seekers, including nearly 900 children, without representation and 300 specialist staff without a job.

A Law Society spokesman said: ‘While Parliament debates further cuts in legal aid, today’s news of the collapse of IAS has left thousands of clients stranded.

'This is the true impact of funding cuts.

‘The government claims that not-for-profit organisations like IAS will fill the gaps in public service provision.

'The fact that this is the second such collapse in the sector shows that these claims are little more than wishful thinking.’