Legal aid users will have to front up with $100 and pay interest on debt under proposed changes by the Government to slash costs.
Justice Minister Simon Power today revealed proposals agreed by Cabinet to reduce legal aid costs by $138m over four years.
The changes, to be introduced to Parliament by mid-year, include re-introducing a user fee, charging interest on debt, tightening the eligibility criteria, and having the State-owned Public Defence Service take up more cases.
"We cannot continue to ignore the substantial cost pressures the system is facing, particularly at a time when New Zealand is being forced to borrow an average of $300 million a week," Mr Power said.
Legal aid spending has increased by 55 percent from $111 million to $172m in the past three years.
"That growth is forecast to result in a $402 million gap between forecast and baseline legal aid expenditure over five years."
Mr Power, who was critical of the Labour Government for scrapping a $50 user fee in 2006, plans to introduce a $100 charge including GST for family and civil cases.
He also proposed changes to eligibility, which could save the Government $48m in four years.
Only single people on less than $22,000 a year and people, with children, on less than $50,000 a year would be able to access legal aid. At present there is no threshold.
People who would not be eligible could apply, but would have to prove their case was likely to be expensive and they were genuinely unable to pay for a lawyer.
The Government also plans to tightened the merits test for family and civil cases, which would focus on the prospects of success of the case.
Up to 50 percent of criminal legal aid cases in Auckland, Hamilton and Wellington would be taken up by the Public Defence Service. Over time, it would expand to Tauranga, Hastings, Dunedin and Christchurch.
Fixed fees for cases that have standard cost structures, including criminal summary cases, most family cases, and some civil cases would also be introduced.
Mr Power said the proposed changes would balance cost reduction against access to justice.
"They're designed to encourage parties to resolve more minor matters between themselves rather than through the court system. It's important that legal aid is targeted to those who actually need it, and that taxpayers can have confidence in the way it's managed.
"I must make it very clear that where vulnerable parties have been harmed or are at risk of being harmed, the state will provide legal means to secure protection. There is no question of that."
He said there would still be a $243m gap in legal aid funding over four years, despite the changes.
"I would be reporting to Cabinet in September with further options to address the remaining funding gap after officials provide me with advice on a closer review of the purpose of legal aid and associated cost drivers predominantly in the Family Court."
