The Solicitors Regulation Authority has more than halved the value of outstanding claims to the compensation fund in the last year, latest figures have revealed.

By the end of the third quarter of this year, the SRA had 509 claims in progress with £20.3m payments pending.

At the same time last year, there were 746 claims in progress – potentially costing the fund £44m.

The pending value of open claims has dropped 27% since the end of June 2014 and by 46% since March.

The compensation fund is paid for by solicitors to recompense clients of firms who have been left out of pocket by breaches of the code of conduct.

The falling value of open claims reflects a significant increase in payments from the compensation fund this year.

In the three-quarters of 2014 so far, the fund has paid out more than £20m in total.

This compares with less than £17m refunded in the whole of 2013.

The SRA has recently changed the eligibility rules for claims made to the compensation fund. This will limit eligibility to individuals and businesses or charities with less than £2m income.

The regulator is likely to reveal the results of a two-year review of the fund in 2015 – with a focus on the impact of alternative business structures and larger entrants to the legal market.

In 2014/15 the SRA will collect around £8.4m for the fund compared to £13.4m in 2013/14. Every PC holder is required to pay a flat fee of £32, with firms paying a contribution of £548.