Follows string of high-profile firm collapses
Solicitors and law firms are facing a sharp rise in fees after the SRA proposed a £25 million increase to its annual funding requirement, as a run of law firm collapses continues to drain the regulator’s compensation fund.
The SRA’s draft Business Plan for 2026-27, published last week, sets out plans to raise its overall budget by 29% to £111.5 million. Individual solicitors would see the SRA portion of their annual practising certificate fee rise from £190 to £240, while firm fees, which are calculated on turnover, would also increase.
Compensation fund contributions are set for even steeper rises. Individual solicitors would pay £120, up from £70, and regulated firms would pay £3,600, up from £1,950 in the current year.
The regulator cited mounting pressure on the fund following the collapse of PM Law Group, which has already generated claims in excess of £20 million. That follows the collapse of Axiom Ince in 2023, which cost the fund more than £40 million, and the failure of Sheffield firm SSB, over which the Legal Services Board formally censured the SRA.
New chief executive Sarah Rapson, who took the top job at the regulator last November, said reform was unavoidable. “Put simply, we need to change how we work,” she said. “We can’t meet today’s demands and achieve what is needed by doing more of the same.”
The Law Society acknowledged the pressure on the fund but pushed back on the scale of the proposed increases. President Mark Evans described the hike as “deeply concerning” and argued that solicitors were being asked to clean up after regulatory failures they had no part in. He said any increases of this magnitude would need to be backed up by a “credible and transparent plan” from the SRA to demonstrate meaningful improvement.
The consultation on the draft Business Plan and funding proposals is open now.