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AG counts losses in outsourced legal cases

Bayford said a new outsourcing policy framework developed in 2024 would bring greater accountability
 
Bayford said a new outsourcing policy framework developed in 2024 would bring greater accountability

Appearing before the 62nd Public Accounts Committee (PAC) examining government books for the financial years 2022 and 2023 on Monday, Bayford said a review of outsourced legal services uncovered a system that lacked structure, transparency, and fair distribution of work amongst private law firms.

“It was not done in a structured fashion. There was no equitable distribution of cases to private law firms. One firm was getting the majority of cases,” Bayford said.

Highlighting the extent of the imbalance, he disclosed that the government outsourced 25 civil litigation matters between 2021 and 2026 at a total cost of P11.1 million. Of those cases, four were handled by a single law firm at P6.5 million.

Bayford further revealed that they found little evidence of effective monitoring of outsourced matters, contributing to delays and rising legal costs.

“We discovered that there was little or no monitoring in the past. We realised that there were delays in these cases, although information suggests that some could have been wrapped up quickly. As lawyers, our time is our stock in trade,” he said.

PAC members expressed concern over the growing legal fees paid to private law firms, warning that the outsourcing arrangement appeared vulnerable to abuse.

Committee chairperson Taolo Lucas questioned how the AG intended to safeguard public funds and prevent future irregularities in the allocation and management of outsourced cases.

In response, Bayford said a new outsourcing policy framework developed in 2024 would bring greater accountability and structure to the process.

“We have realised that in the past these private firms were given these cases and allowed to work without monitoring. So we have said there is going to be regular, periodic reporting. They should work with an attorney from the AG’s office,” he said.

The PAC also scrutinised the Attorney General’s expenditure on legal costs during the years under review after discovering that an initial budget allocation of P8.7 million had eventually increased to P16.9 million.

Bayford attributed the significant increase to the unpredictable nature of litigation and the difficulty of accurately estimating legal costs in advance. He explained that the government often finds itself requesting supplementary funding during the financial year to meet legal obligations arising from ongoing court cases.

“We do not always know how much will be needed during the course of a particular period and, as a result, we end up requesting supplementary budgets to pay legal costs,” he said.

Additionally, the Attorney General agreed with PAC member and Gamalete legislator, Boniface Mabeo, that the government continues to spend large sums of money on cases that could have been avoided altogether. For example, Bayford pointed to the growing number of court disputes involving scarce skills allowances, arguing that many of the matters should never have reached the courts because there are already legal precedents and judgments addressing similar issues.

He said that whilst the AG routinely advises ministries on legal risks, government lawyers are often brought into disputes long after critical decisions have been made.

“In most cases, we are roped in very late when the matter is already in court. It is true that government is losing a lot of money, and it is a concern, especially during these difficult economic times,” he said.

Bayford said efforts are underway to encourage ministries and government departments to seek legal advice earlier to prevent costly litigation and identify legal risks before disputes escalate.

“We have encouraged ministries to engage us on time so that we provide legal advice on time and flag legal risks well in advance,” he said.

He further revealed that the current arrangement makes it difficult to determine which ministries are responsible for the highest legal costs because the budget vote is held centrally by the AG.

However, he indicated that future reforms could see ministries managing their own legal cost votes, making it easier to track expenditure and in some cases where it is found that there was negligence, hold accounting officers accountable for litigation-related spending.