Law, medicine most anti-competitive - study

Lawyers and doctors came out worst in the detailed study of eight professions published yesterday. Colm Keena reports

Mr Alan Gray, the managing director of the consultancy firm that conducted the study, said it had found that there were: "very severe restrictions" on competition between solicitors; "extensive restrictions" on competition between barristers; a "number of extensive restrictions" affecting competition between doctors; and " significant restrictions" on competition between vets and between dentists.

Mr Gray said the study found there were relatively few restrictions to competition between engineers and to competition between architects. Regarding opticians, he said there were a number of restrictions which had a potentially negative effect on competition.

The 663-page report by Indecon economic consultants identified restrictions on competition in the areas of: entry to the professions; advertising by members of the professions; the prohibition in some professions on members setting up limited companies and working in multidisciplinary practices with other professionals; and issues to do with demarcation and conduct.

The report said that removing the restriction on some professionals forming limited companies could increase investment in the provision of services, such as primary healthcare services.

Mr Gray said the study pointed out that in other states, action against restrictive practices in the professions had led to decreases in pricing in the order of 20 to 30 per cent. Significant price drops were particularly likely where a number of restrictive practices were removed. The chairman of the Competition Authority, Mr John Fingleton, said the effects of any changes introduced could take time to work their way into the system.

The report made particularly strong findings on solicitors and barristers. It found that the Law Society's monopoly on the provision of certain courses for trainee solicitors was likely to restrict the number of entrants to the profession. It also meant that Dublin was the only location where such training was available.

The report said removing certain restrictions on solicitors who qualified in other jurisdictions coming to practice in Ireland would enhance competition. It also said that solicitors should be allowed advertise "superior specialist services" and should be allowed make "cold call" approaches to potential clients. Personal injury services would be an exception.

On conveyancing, the report said that restrictions on solicitors from other EU jurisdictions offering such services should be lifted, and that a system of licenced conveyancers could be introduced. It also said solicitors should be allowed form limited liability companies and should be allowed practice with members of other professions.

On barristers, the report said that the King's Inns' monopoly on the provision of a number of legal courses was likely to restrict the number of entrants to the profession. It also said the fact that trainees were not paid was likely to act as a barrier to the profession.

Rules that prevented barristers from advertising and that prohibited clients getting direct access to barristers, were likely to restrict competition, the report said.

It also criticised a restriction whereby barristers who are employed by companies are not allowed address the courts and, furthermore, are obliged to use a solicitor to get access to a practising barrister who would then represent the company in court.

The report also said that barristers should be allowed form companies and work in multidisciplinary practices.

On medical practitioners, the report said many of the regulations covering the medical profession were appropriate for the protection of the public. However, it said there were extensive restrictions that inhibited competition and investment without providing proportionate benefits.

The limitation on places in medical schools cut competition as did the current system used to control the transfer here of doctors from non-EU countries. It also said the system for creating and filling public sector consultancy posts was too slow and not responsive enough to demand.

On GPs, it said no limit should be placed on the number of medical card contracts that could be awarded to GPs in any particular area. This would facilitate the creation of new GP practices and allow the number of practices to respond to market demand.

The report said there should be scope for patients making direct contact with consultants, ie without having to first go to a GP. It also said that doctors should be able to advertise their fees and services, as well as the establishment of new practices.

The report also said that GPs should be allowed incorporate their practices, i.e. create limited companies, as this would allow for the investment of capital in primary healthcare services.

On dentists the report said that a system for registering qualified dental technicians and "denturists" would increase competition in the sector by allowing people other than dentists to sell dentures to customers.

It also criticised the rules in relation to non-EU dentists coming to practice here, and the limitation on the number of places in Irish dental schools.

It further criticised restrictions on advertising by dentists and the rule whereby dental hygienists have to work under the supervision of dentists. Again it said that dentists should be allowed establish limited liability companies.

On vets, the report criticised current training arrangements, which it said acted as a constraint to entry to the profession. It criticised restrictions on advertising, and restrictions on the scope of practice of veterinary nurses.