Using PEST analysis to identify external influences
A Legal Services Commission case study

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Page 4: Economic factors

The workload of the LSC goes up and down with the performance of the economy.  In an economic downturn, it is likely that there will be more cases of social exclusion. This is because there are more business failures, along with more redundancy and unemployment. This change in people's circumstances may result in debt and eviction. It may also lead to higher levels of crime, for example, shoplifting or criminal damage to property and theft.

The funds for the LSC are allocated in two flows. Its internal costs the administrative costs of running the service are fixed over a 3-year term. This figure is at present £117million. The fund for providing legal support is fixed on an annual basis. This means that the LSC has to be careful about spending money in order to achieve maximum benefits for its clients with limited funds.

The LSC is an organisation sponsored by the UK Government's Ministry of Justice. This means that the government sets out the overall aims for the LSC and it operates within this framework. It does not make a profit. Its job is to deliver services efficiently and within budget. This can be difficult because of economic changes.

Its success is measured by the service targets it hits, based on the strategic objectives set by the Prime Minister. The targets are set out in the LSC Performance Framework and include the number of people helped each year, how quickly they were helped and how efficiently the budget has been managed.

Legal Services Commission | Using PEST analysis to identify external influences