Potentially thousands of Ontarians who can't afford a criminal lawyer will have to represent themselves at trial, as a deficit at the provincial agency that funds legal aid means it has to cut back dramatically on services.

While Legal Aid Ontario will still issue legal aid certificates — which cover a person's legal fees — for criminal defence lawyers in cases where there is a "substantial likelihood of incarceration," it will generally no longer do so in other matters.

That means that impoverished individuals who may not be facing jail time but could be deported, fired or slapped with a hefty fine if they are convicted — and get a criminal record in the process — will be left to fend for themselves in courtrooms across the province.

The news was announced in a memo from LAO president and CEO David Field, issued Friday afternoon and obtained by the Toronto Star.

"Despite our best efforts to predict client demand for expanded services, our forecasts were well below actual demand," he said in the memo. "The end result was that we provided more services for clients than we had available funding for. We now need to take steps to bring client services in line with our funding."

LAO, which received $363 million from the provincial government in 2014-2015, was unable to provide a representative for comment Friday.

Field did not disclose the size of LAO's budget deficit; however, Attorney General Yasir Naqvi said in a statement he was concerned with the agency's financial situation.

"Since 2014, we provided LAO with over $86 million in new funding, so that a further 400,000 low-income people qualify for legal aid services. By next year, we will have increased LAO's funding by $153 million over four years," he said.

"Despite this fact, LAO has run a deficit this year. This is concerning. It is my expectation that LAO continues to offer the same level of services while they work to meet their internal challenges.

"While I believe that LAO has the expertise and the resources to address these challenges, the Ministry of the Attorney General is available to provide LAO with any guidance they need."

Anthony Moustacalis, president of the Criminal Lawyers' Association, said LAO has increased exponentially its number of staff lawyers — whose duties include handling guilty pleas and bail hearings — instead of turning to the private criminal-defence bar, who can handle those matters as well as trials.

"Legal Aid has had six years of internal, inefficient and largely unnecessary growth when there were already a large number of efficient and high-caliber criminal defence counsel who were taking (legal aid) certificate matters and were able to absorb the overhead through other clients," he said.

The household-income threshold to qualify for legal aid, although increased over the years, remains far too low, critics have charged. Moustacalis said there was a recent shortage of people facing jail time who were poor enough to qualify, leaving LAO with money left over; the agency responded, he said, by expanding access to legal aid for individuals not facing jail time.

Field, for his part, stated in his memo that "the mix of expanding financial eligibility and new types of services, however, resulted in unprecedented demand."

He said in his memo there are a "couple of limited exceptions" to the new limits to criminal-defence funding. The government agency will "retain the discretion" to issue a legal-aid certificate on a case-by-case basis for people from "vulnerable client groups" facing trial but not necessarily jail time.

Field also said LAO still plans to raise the household-income threshold by six per cent starting in April 2017. The threshold for a single person with no dependants is currently around $13,000.

"The announcement from Legal Aid Ontario today is a significant blow to the administration of justice in Ontario," said criminal defence lawyer Michael Lacy.

"The most vulnerable and disenfranchised in society are adversely affected by this. And the courts will be overwhelmed with self-represented accused who will no longer be eligible for a legal-aid certificate because the Crown is not asking for jail ... It's a no-win situation."

Within LAO, the agency will be freezing salaries at 2016/2017 levels, not filling staff vacancies where possible, reducing administrative costs, and reducing the number of future articling positions, Field said.

"LAO lawyers and articling students call upon the provincial government to fund Legal Aid Ontario's budget deficit. This deficit exists because the government expanded access to legal aid," said Scott Travers, president of the Society of Energy Professionals, the union for 350 LAO staff lawyers and 25 articling students.

"It is bitterly ironic that Legal Aid Ontario faces cuts now because low-income Ontarians used this desperately needed service so well."

In terms of legal clinics, LAO said it will not increase salaries and will be reducing clinic operation budgets by $1 million.

"Cuts like this would have a negative impact on access to justice for the most vulnerable in Ontario and would undermine the province's anti-poverty strategy," said Lenny Abramowicz, executive director of the Association of Community Legal Clinics of Ontario.

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"We plan on working with both Legal Aid Ontario and the Ministry of the Attorney General to ensure that these cuts are not implemented."

There was a brief mention in Field's memo about LAO's work with refugees at asylum hearings. The Toronto Star previously reported that the agency was trying to limit its spending on refugee and immigration cases due to its funding crisis.

Field said LAO will work with the federal government "on addressing next year's funding pressures" and examine ways to "better align our services with available funding."