Member Article

A Budget For Law Firms?

Ahead of the Chancellor’s highly anticipated annual Budget announcement, Kathryn Taylor, managing partner at Gordon Brown Law Firm looks back on last year’s discussion to see if, on closer inspection of his promises, was there really anything in it for law firms?

Last year, George Osborne announced greater funding for apprenticeships. Over the last few years Gordon Brown has invested heavily in apprenticeships in all areas of the business including HR, Accounts and Administration. We aim to dispel the myth that apprentices are just cheap labour and have actively developed and trained our recruits, moving them up our internal career ladder – some of who are now fee earners. Law firms should not underestimate the value of loyal, home-grown talent that develops with a business. In my view, the pledge given of more funding for apprenticeships in the Budget was welcome news for our sector, representing a real opportunity for growth. I would urge all firms to consider taking the time to nurture their own talent via this route as the 2015 announcement approaches.

Another budget amendment was the removal of the requirement for those with defined contribution pensions to buy an annuity – a real game changer. Under the new rules, the individual’s accumulated pension pot can be taken as cash lump sum, eventually becoming part of their estate.

This change has been of particular importance to law firms with private client departments involved in inheritance tax planning. Care Home Fee planning was predicted to be another growth area, where careful consideration needs to be given by the client as to the likely impact of receiving a large cash lump sum. As annuity providers are no longer looking after the clients’ money, Solicitors have likely been encouraging more clients to consider who will perform this task, particularly in the event of a loss of capacity. Law firms should continue to see this as an opportunity to expand the number of Lasting Powers of Attorney they undertake.

The announcement of support for manufacturing by way of a £7bn package to business energy bills was undoubtedly welcome news for corporate and commercial property lawyers. This area of the legal market has seen the slowest recovery from the recession and anything that enables businesses to grow and establish themselves is welcome news. However, access to funding continues to remain a real problem for all businesses including law firms, and many argue that until greater support is offered in this area, growth in the business sector will be hampered.

In summary, last year’s Budget wasn’t the answer to all law firms’ prayers – the proof, as they say, is in the pudding. But a few glimmers of hope remain to latch onto and as far as I’m concerned, it’s certainly a step in the right direction.

Now to see what the next Budget announcement will bring.

Kathryn Taylor is managing partner at North East based Gordon Brown Law Firm – for more information visit www.gblf.co.uk.

This was posted in Bdaily's Members' News section by Kathryn Taylor .