Scottish lawyers’ fee income lags behind rest of UK

The Royal Bank of Scotland’s 2015 Financial Benchmarking Report on law firms found that for a Scottish equity partner the median fee income was £334,000 last year, an increase of £2,000 on 2013’s figure of £332,000.

The next lowest regional group, equity partners in the south west of England, brought in £422,000.

The highest average was in London, at £870,000, followed by the north east of England, where equity partners’ median fee income was £616,000.

Scotland also recorded the lowest average profit per equity partner at £84,000, down from £90,000 in the previous year.

Again, London topped the table with £271,000 followed in second place by the south east of England, where profit per equity partner was £119,000.

The north east and north west came in third place at £112,000.

RBS’s report found that Scottish law firms saw an average five per cent uplift in revenue in the period.

Relationship director for RBS, Ann Crusher, said: “It is perhaps surprising then that profit per equity partner at a median level of £84,000 is flat with that of 2013. Like other regions, the suggestion is that increased staff numbers has impacted profitability.”

Scottish firms, on average, saw their profits increase by nine per cent over the year – though much of that rise was a result of improvement from smaller practices.

The larger law firms saw a one per cent increase in the year, again the lowest in the UK.

But this may be attributable to the lower average number of chargeable hours per fee earner in large firms, which was 806, significantly below the UK median of 1,000.

At £130, large Scottish firm also had the lowest recovered rate per hour in the UK although smaller firms came in second place with a figure of £143.

The median fees brought in per fee earner at Scottish law firms was £108,000, representing a fall of £6,000 on last year’s number.

51 firms in Scotland took part in the research, with 31 classified as small, which referred to firms whose fee income was lower than £1.5 million.

The report looked at firms with less than £35m of fee income.

A Law Society of Scotland survey of its members found that 61 per cent were optimistic about the future of the profession, compared to just 53 per cent in 2013.

Other findings included:

Read the RBS report here: 2015 Financial Benchmarking Report – Law Firms.