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7% tax brings in over $100 million a year. 'Where did all the money go?' asks BCGEU's Darryl Walker.
Vancouver (6 Nov. 2009) - While the B.C. government cuts funding to legal aid services and forces the Legal Services Society (LSS) to reduce administrative costs by closing regional offices, tens of millions of dollars in money earmarked for legal aid services is disappearing into the province's general revenue fund, says the B.C. Government and Service Employees' Union(BCGEU/NUPGE).
B.C. imposes a 7% tax on legal services in B.C. – supposedly earmarked for legal aid services for low-income people who cannot afford them.
In an article published in 2007, Frits Verhoeven then-president of the Canadian Bar Association (CBA), estimated that the tax "brings in well over $100 million per year."
However, the province has not transferred more than $67.8 million to the Legal Services Society for legal aid services since 2007, according to the society's service plan.
Where did it go?
"Where did all the money go?" asks BCGEU president Darryl Walker. "By our estimate, the government has been holding back up to a third of the revenue that should go to legal aid. Now they are forcing the society to close regional offices, and are under-funding legal aid services to low-income families."
In 2001, the LSS operated 19 branch offices around the province. When B.C.'s Liberal government cut 40% from the legal aid budget in 2002, the society was forced to close 12 branch offices. By 2010 only two regional offices will remain - in Vancouver and Terrace.
BCGEU says the budget cuts have meant that the scope of services has been restricted and eligibility criteria tightened, excluding many more people from accessing legal services. In January 2009 the LSS was forced to cut further - laying off 38 staff from its Lower Mainland office, despite a huge increase in referrals for services.
"The government must be made to explain how they can continue to cut legal aid services while keeping up to a third of the legal services tax revenue that is earmarked for the service," Walker says.
NUPGE
The National Union of Public and General Employees (NUPGE) is one of Canada's largest labour organizations with over 340,000 members. Our mission is to improve the lives of working families and to build a stronger Canada by ensuring our common wealth is used for the common good. NUPGE
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B.C. legal aid services hit by new round of cuts