The head of the provincial organization that funds legal aid — which recently announced major cuts to services due to a $26-million deficit — said he would welcome an external audit of his agency.

“We’re committed as an organization to open government, and so I wouldn’t have a problem with that, I’m very confident in our financial position,” Legal Aid Ontario president and CEO David Field told the Star in an interview Tuesday.

Field was speaking days after LAO announced it was scaling back on services, including no more legal funding for individuals charged with crimes, but who are not facing jail time.

The move would affect thousands of people who can’t afford a lawyer and who could still be fired, slapped with a hefty fine, or have difficulty travelling if convicted of a crime.

Critics have charged that the agency, which has a $440-million annual budget, mishandled its money and is spending far too much on “inefficient” internal growth, rather than spending more on community legal clinics and covering legal fees for private criminal defence lawyers.

“We provide the attorney general with ongoing financial information about our situation, our financial statements are audited by the auditor general on an annual basis, and we have a team of internal auditors who report to the board of directors,” Field said.

“And so I’m confident that this has not been the result of mismanagement, but really what we’re looking at it is a demand in our services, and not a bloated bureaucracy or anything like that.”

Other changes announced by Field in a memo Friday include freezing salaries within LAO and reducing legal clinic operation budgets by $1 million.

“This calls for a full and independent audit,” Margaret Parsons, executive director of the African Canadian Legal Clinic, told the Star, adding she was blindsided by Friday’s announcement.

“Where is the oversight? I don’t think the cuts should be on the backs of services. Poor people should not have to bear the brunt of this. The community should not have to bear the brunt of their gross mismanagement.”

A spokeswoman for Attorney General Yasir Naqvi reiterated in a statement to the Star Tuesday that the ministry remains concerned about the agency’s financial situation, though did not directly respond to a question as to when Naqvi knew LAO was facing a deficit.

“LAO’s board is an independent decision-making body. That being said, the attorney general recently met with LAO and expressed his expectation that LAO’s current challenges need to be managed in a way that maintains front-line services,” said spokesperson Clare Graham.

“We will continue to closely monitor this situation and are readily available to provide LAO with any guidance they need at this time.”

To qualify for legal aid, a person must fall below its current household income threshold, which is about $13,000 for a single person with no dependants. Field again stated Tuesday that LAO plans to raise the threshold by 6 per cent starting in April 2017.

Even with the increase, the threshold has long been criticized as being far too low, and was called out in June by Superior Court Justice Ian Nordheimer in a case of a man charged with drug offences who was denied legal aid because he made about $16,000 a year.

Nordheimer stayed the charges until the government picked up the tab for the man’s lawyer, noting that LAO’s thresholds “do not bear any reasonable relationship to what constitutes poverty in this country” and wrote that Statistics Canada calculates the low-income cut-off for a single individual in a large city as closer to $25,000.

“I can’t disagree with Justice Nordheimer, our $13,000 is not high, by any measure,” Field said. “It’s just that the regulations and funding are set by the province and we work within that envelope provided.”

He noted that the provincial government has made a 10-year commitment to bringing the threshold up to the Statistics Canada level. Field also said that LAO will be continuing to work with the federal government to increase funding for legal aid work with refugees at asylum hearings.

There was a recent shortage of people facing jail time who were poor enough to qualify for legal aid, leaving LAO with money left over; the agency responded by expanding access to legal aid for individuals not facing jail time.

Field said in his memo that “the mix of expanding financial eligibility and new types of services, however, resulted in unprecedented demand.” He told the Star Tuesday he hopes the agency will one day return to offering those expanded services.

“I’m hoping this is temporary and that over the course of the next couple of years, I’m hopeful we’ll be able to return to providing services in those areas,” he said, adding he was “disappointed” the agency had to make the cuts it did.

Anthony Moustacalis, president of the Criminal Lawyers’ Association, has criticized LAO for increasing its internal costs by hiring a large 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.

Field said one of the reasons LAO increased its “capacity” was because of what he described as a job action taken by the CLA several years ago when the tariff for legal aid was being negotiated.

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“During that time, we really were vulnerable to job action on the part of the bar and we felt that in order to provide continuity of services to our clients, we needed to increase our capacity.”

Moustacalis said Tuesday it was a “withdrawal of service,” that criminal lawyers decided not to take on homicide cases because the tariff was so low. He said the bar today has no intention of taking similar action.

“I’ve always said they’re hiring for a contingency that no longer exists,” he said, explaining that the criminal lawyers would like to sign a new agreement with LAO that would recognize their participation in the system and provide for a cost of living increase.