- Independent economists undertake an assessment of the economic and other benefits flowing from the Law Commission’s law reform recommendations.
- The predicted economic gains from the five highest-value projects in recent years exceed more than £3 billion over ten years.
- The projects assessed have positively affected the lives of more than 27 million individuals in the UK
An independent economic analysis of the Law Commission’s work has found that Law Commission’s recommendations – if implemented – would be overwhelmingly beneficial to the economy, to society and to business. The economic value of just five of the projects would exceed £3 billion over ten years whilst all eleven projects analysed would positively contribute to the lives of more than 27 million individuals in the UK.
The economists undertook a contribution analysis to explore whether intended outcomes have been achieved across eleven projects all chosen from recent times. They examined how and why change has happened and assessed the contribution of the project to the change. Contribution analysis is an established tool for assessing impact and is used in situations where precise quantitative modelling is difficult.
Findings in detail
The report found that the economic gains from the implementation of the Law Commission recommendations were significant and considerably outweighed the cost of conducting the project and implementing the recommendations.
Over the ten-year period examined by the economists the gain to society, the economy and to businesses vastly outstripped the low costs of carrying out the law reform project. The total cost of the Law Commission is less than £5 million per annum and, typically, the Commission can be engaged in up to 20 law reform projects at any one time.
Even fairly technical reform projects can generate very substantial benefits. The £3 billion benefit referred to as flowing out of only five recent reports demonstrates this:
- The Mental Capacity and Deprivation of Liberty report (2017) would provide benefits worth £1.64 billion over ten years from improved health outcomes and harm prevention.
- The Event Fees in Retirement Properties report (2017) could lead to a rise investment in retirement homes worth £805 million over ten years.
- The Sentencing Code (2018) will reduce court time needed and legal costs, worth up to £256 million over ten years.
- The Taxis and Private Hire report (2014), which is still being considered by Government, could save £242 million over ten years by reducing regulatory burden.
- The Form and Accessibility of the Law Applicable in Wales report (2016) will save £194 million over ten years by making the law applicable in Wales clearer, simpler and easier to access and apply
The Law Commission’s work has the potential to affect millions of businesses, households and individuals across England and Wales. The economists estimated, for example, that the Consumer Insurance report (2013) alone would benefit approximately 27 million people and households. It is not possible to determine exactly whether people have been affected by more than one set of law reform. The 27 million figure has been calculated to be a conservative estimate of the total number of people positively affected.
Our project on the Form and Accessibility of the Law Applicable in Wales report has been calculated to affect 3.2 million people in 2019, and the Adult Social Care report would affect 1.8 million new persons in 2018-19 in addition to 0.9 million existing persons receiving long-term care.
The Rt Hon Sir Nicholas Green, Chair of the Law Commission said:
“So far as we are aware there has never been an analysis of this sort conducted anywhere else in the world. We undertook this economic analysis to measure the impact of our law reform work so that we could ensure that we are effectively using public money and to provide guidance to us in our future work.”
“The lessons learned can assist in ensuring that, in the difficult years ahead, we pursue law reform solutions which provide the greatest benefit to Government, to society generally, to the economy and to businesses.”
“The results of the analysis are startling. It has shown that our reforms are making a real impact, providing significant economic gain and benefitting millions of people.”
“As we start to think about our next Programme of law reform, we look forward to engaging with the public on future projects that we hope will have a similar impact.”