Legal aid charge 8% interest

Maxizmum

I was eligible for legal aid for a divorce a few years ago and accumulated almost £5k of solicitors fees even though I did most of the work myself to keep any costs down. I was on low income with no savings and 2 small children to support when their father chose to pay nothing. It wasn't until a year after the divorce was settled that I discovered that my legal aid 'loan' was increasing by 8% interest at £1 a day, horrified I borrowed from family to pay off the balance. I want to ask how the rate of 8% can be justified when the Bank of England rate is so low and usually only the most vulnerable use legal aid?

[Deleted User]

It doesn't need to be justified.

It's the deal on offer and lower than most other alternatives. 

[Deleted User]

Maxizmum said:

I was eligible for legal aid for a divorce a few years ago and accumulated almost £5k of solicitors fees even though I did most of the work myself to keep any costs down. I was on low income with no savings and 2 small children to support when their father chose to pay nothing. It wasn't until a year after the divorce was settled that I discovered that my legal aid 'loan' was increasing by 8% interest at £1 a day, horrified I borrowed from family to pay off the balance. I want to ask how the rate of 8% can be justified when the Bank of England rate is so low and usually only the most vulnerable use legal aid?

The rate is set by the Ministry of Justice and Robert Buckland QC, MP is the current Secretary of State for Justice so he would be best placed to answer your question.  When Shailesh Vera was the Parliamentary Under-Secretary of State for Courts and Legal Aid back in 2016 he said, "the current level of ‘simple interest’ was ‘appropriate in discouraging vexatious or unnecessary legal action and encourages early repayment’."

sourcrates

8% simple interest is about standard across the board as it is the amount a court would apply, and as stated above, is set by the ministry of justice.