Direction of travel

It has been a difficult year for the Solicitors Regulation Authority (SRA) and it’s widely acknowledged, including by the regulator itself, that although there have been a lot of changes, there are yet more challenges to come.

Key changes

For the legal profession, and solicitors in particular, the last 12 months have seen significant changes, including the following:

• The government announced that the Financial Conduct Authority will take over the regulation of anti-money laundering from the SRA.
• The SRA appointed a new chief executive officer (CEO), Sarah Rapson, who announced focusing on improving operational excellence, collaboration and proactive identification, and pledged to ‘reset’ the regulator’s relationship with solicitors.
• The Court of Appeal delivered its decisions in Mazur and Dentons, cases that have reshaped the rules around how law firms delegate litigation work, supervise unqualified staff and manage anti-money laundering compliance.

The next 12 months are shaping up to be a period of further change for the regulator. The SRA has:

• published its draft business plan asking for a £100 increase in the practising certificate fee
• published its proposals in relation to continuing competence, adding further costs to legal services businesses, and
• begun the search for a new chair of the SRA board.

In addition, the Legal Services Board also has a new CEO, Richard Orpin, who will be keen to justify the relevance of that organisation against a backdrop of criticism regarding recent regulatory failures.

One change that we won’t see is the SRA taking over the regulation of legal executives. Ms Rapson made clear that, given all the other changes, it was not her plan to further increase the workload of the organisation.

Purpose of the SRA

It’s all too easy to overlook the actual purpose of the SRA. The SRA exists to exercise the regulatory functions assigned by parliament to the Law Society and delegated by the Law Society to the SRA.

Day-to-day management of the regulator is entrusted to the CEO, who is accountable to the SRA board that sets the direction of the organisation. If one compares the SRA to a human being, then the board is the brain of the regulator and the CEO and the employees of the organisation are the hands that do the work. However, the CEO does have a considerable degree of latitude in the execution of the directions of the board.

The SRA’s governance handbook (February 2026) makes clear that the mission of the regulator is “driving confidence and trust in legal services”.

New board chair

The current chair, Anna Bradley, will step down from the role of board chair at the end of 2026. The appointment is a critical one as the chair is responsible for making sure that the board works effectively to discharge its functions.

The profession should take a more active interest in who is appointed to this pivotal role. Although it has no formal say in the appointment, it is by no means without influence or a voice.

At the top of the new chair’s agenda must be a commitment to greater transparency and to robustly hold the CEO to account. The profession is understandably angry about the recent failures at the SRA, but it is angrier still that no one was held accountable for those failures.

‘New’ CEO

It is no longer necessary to describe Ms Rapson as ‘new’; she has now been in post for several months. But the SRA CEO faces a formidable task in rebuilding the profession’s confidence and trust and, to her credit, Ms Rapson has recognised the organisation’s shortcomings and set out a plan to address the regulator’s deficiencies.

Draft business plan

The SRA’s draft business plan consultation closed on 22 June 2026 and is expected to publish in October.

The business plan sets out three priorities for the regulator:

1. Proactive risk management: catching issues earlier through intelligence-led approaches and pilot supervisory methods.
2. Focus on the biggest risks: exploring ways to reduce risks associated with solicitors holding client funds, including better external assurance.
3. Operational excellence: upgrading IT infrastructure and internal processes to ensure decision-making is consistent and sustainable.

Identifying and addressing risk

The SRA plans to “enhance risk insight through stronger data and analytics”. The regulator already has a lot of data about the individuals and entities that it regulates, but the Carson McDowell report into the failures at Axiom Ince shows that the SRA was not using this data effectively (see their independent review of the regulatory events leading up to the SRA’s intervention into Axiom Ince.

Concerns that SRA staff had about entities, such as Axiom Ince and SSB Law, were largely ignored by those in a position to do something. The focus needs to be on getting the right data in front of the right people for the SRA to take the appropriate regulatory action.

The regulator intends to “strengthen risk-based prioritisation and early case escalation”. It’s a sensible aim, but it doesn’t reflect current practice. It is widely reported that the SRA has experienced a sharp rise in complaints. Compliance professionals across legal services also report a worrying number of cases that are closed without escalation, even in circumstances where, on the face of it, there are questions of dishonesty. Early resolution is welcome, but not at the expense of lowering the high standards of the profession.

Perhaps the most interesting proposal under this objective is to “establish a proactive supervision function to undertake engagement activity directly with firms to identify, understand and manage risks”. This sounds a bit like the Practice Standards Unit that was abolished by the SRA in the early 2010s (there have been calls from some quarters to bring this back). Regardless, large firms have benefited from having an SRA relationship manager to liaise with in respect of regulatory matters. Hopefully a more proactive supervision function will provide the same level of support for smaller firms.

Focusing on the biggest risks

There is no bigger issue than the protection of client money and the current SRA Accounts Rules are seemingly inadequate in providing the necessary protections to both consumers and law firms. Although this has been on the SRA agenda for some time, hopefully it will be an issue the regulator addresses sooner rather than later.

Yet it appears that this may not be the SRA’s main area of focus. The business plan identifies high-volume consumer claims as a major issue, and the SSB Law matter has exposed poor practice in this area. However, it is not yet clear whether those failings are more widespread. The reality is that the collapse of SSB Law has attracted significant political attention, which helps to explain why the issue is being prioritised.

The SRA has said that it also wants to enhance confidence in the Solicitors Qualifying Examination (SQE). The SQE is challenging but necessary to ensure high standards in the profession. A more important issue for the SRA to address than the level of difficulty is the cost of taking the SQE. Students leaving university are increasingly saddled with huge debts and the cost of the SQE is a barrier to those from the poorest backgrounds. The SRA must do more to make the SQE more affordable.

Operational excellence

In the last few years the SRA has had a high turnover of staff. At the lower level several experienced people have left (many to join the private sector) and it has also lost a significant proportion of its senior management. Ms Rapson has made a start in recruiting senior managers to try and enhance the expertise of the regulator.

Contrary to popular perception, the SRA employs many dedicated and hard-working professionals, a significant number of whom are admitted solicitors. Retaining that calibre of talent is a challenge, given that they can earn more in private practice. That so many choose to remain with the regulator is a measure of their commitment to the profession. The profession must also recognise that maintaining a high-quality regulator comes at a cost for those in practice.

This must be matched by the stated aim to “build a high-performance culture and drive operational excellence across the organisation”. High performance depends on clear measures of success. More importantly, those metrics should be made public, along with the SRA’s performance against them.

Greater transparency of that kind would go some way towards rebuilding the profession’s confidence in the regulator.