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Big bang for the buck in legal aid budget

An independent cost benefit analysis of Australia’ legal aid services demonstrates the sound economic sense of providing affordable justice, argues Gabrielle Canny.

Photo: AAP/Margaret Scheikowski

Photo: AAP/Margaret Scheikowski

What price do we put on justice in Australia?

It may not be a question that gets asked all that often, but it’s an important one.

Access to justice is a fundamental right, but unfortunately it’s not always front of mind for most people until they find themselves facing a legal problem.

Providing legal aid to people in our community who wouldn’t otherwise be able to afford legal representation is essential to the smooth operation of our courts and legal system in Australia.

That’s why National Legal Aid, the body made up of all the Legal Aid Commissions around the country, including South Australia’s Legal Services Commission, has gone on a deep dive into quantifying the benefits of Legal Aid services.

We commissioned PwC to provide a report on the benefits of providing access to justice – and what their analysis showed is truly staggering and too important for governments and the community at large to ignore.

PwC’s analysis estimates Legal Aid services deliver over $600 million in benefit to the country each year, highlighting the vital need for continued investment in legal assistance.

The analysis shows a Benefit Cost Ratio (BCR) of 2.25 when considering the $267 million in annual Commonwealth funding that the Legal Aid Commissions around the country administer.

So for every $1 invested in Legal Aid services by the Commonwealth government, there is a benefit of $2.25 delivered, in terms of avoided costs to the justice system, to individuals, and to government – this is an enormous Benefit Cost Ratio when it comes to public finances.

This $2.25 benefit for every dollar in funding shows that for governments and for our society, it’s really a case of how can we afford NOT to continue to invest in the legal assistance sector?

When you consider that business cases for the North South Corridor and most major road and infrastucture projects get the go ahead with a BCR of just above 1:1, it shows just how sound an investment legal assistance is.

Particularly when you look at the breadth of work that the Legal Aid Commissions undertake to support the community.

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Whether it’s in family law, civil law, the NDIS, assisting people with disability, veterans, and people experiencing domestic and family violence, the total number of services we provide is enormous.

For every $1 invested in Legal Aid services by the Commonwealth government, there is a benefit of $2.25 delivered, in terms of avoided costs to the justice system, to individuals, and to government

In 2021-22, the Legal Aid Commissions around the country collectively delivered over 1.5 million services – including over 680,000 information and referral services, over 410,000 duty lawyer services, and over 300,000 legal advice services.

These numbers represent real people seeking the legal help they need – people facing domestic violence, relationship breakdowns and separations, disputes over parenting arrangements, issues with the NDIS, entitlement to pensions and social security benefits and migration law issues.

Without Legal Aid Commissions providing the breadth of support and representation we do, our legal system simply would not function.

PwC’s analysis found that the approximately $601 million in benefit each year included the improved operational capacity of the courts, the benefits derived by individuals who achieve improved legal outcomes, and the benefits derived by government and society when an individual achieves an improved legal outcome.

Put simply, resolving disputes and keeping people and matters out of court saves money – for the people involved and for taxpayers at large.

But importantly, there are also broader societal benefits, by helping people avoid the stress and potential mental health impacts that can arise out of protracted legal problems and court proceedings.

And with the country’s health system and mental health system under severe strain, it is important that other sectors such as ours do all we can to not compound that strain – and by helping people to settle legal issues fairly, we can avoid the potential suffering that can arise.

So as we fast approach the time where Commonwealth and State governments will hand down their budgets and as they consider their priorities for the years ahead, it’s abundantly clear we’ve got 600 million compelling reasons to continue investing in Legal Aid.

Gabrielle Canny is CEO, Legal Services Commission South Australia

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