SRA: SQE £59 Million Fees Projected for 2026-27 Budget

• The Solicitors Regulation Authority projects £59.1 million in income from SQE candidate fees for 2026-27.
• The SRA has prioritized improving confidence in the SQE and enhancing the candidate experience.
• An independent technical evaluation of the SQE's design and operation is currently underway.
• The SRA is consulting on changes to SQE1's Functioning Legal Knowledge and will reduce its questions from 360 to 340 by January 2027.
• Recent SQE1 pass rates fell to 42% in July, down from 53% in January.

The Solicitors Regulation Authority's proactive measures, including the significant SRA SQE £59 million fees budget and the commitment to SQE confidence improvements, signal a critical period of adjustment and refinement for the solicitor qualification pathway.

The Solicitors Regulation Authority (SRA) anticipates generating substantial revenue from the Solicitors Qualifying Examination (SQE) in the upcoming financial year. According to its 2026-27 business plan, the regulator projects an income of £59.1 million from education and training, primarily derived from SQE candidate fees. This figure represents a modest 2% increase compared to the £57.8 million allocated in the preceding financial year.

While income is set to rise, the SRA's expenditure on education and training, largely associated with the delivery of the SQE, is also expected to climb. The budget for this area is £60.9 million, an increase from £58 million in 2025-26. The SRA has clarified that these operational costs are "almost entirely offset through fees paid by the SQEs candidates," indicating a self-sustaining financial model for the assessment.

A central focus for the SRA in the coming year is to bolster confidence in the SQE among prospective solicitors and the broader legal community. The regulator has explicitly stated that further progress is essential to enhance the candidate experience and build trust in the examination process, acknowledging that while improvements have been made, more work remains. This commitment underscores the SRA's dedication to refining the SQE's implementation and perception.

To address existing concerns and foster greater assurance, the SRA is actively engaged in a technical evaluation of the SQE, collaborating with independent assessment experts. This comprehensive review aims to provide "assurance on its design and operation" and pinpoint areas for potential enhancement. Following the evaluation, the SRA intends to carefully consider the findings and initiate relevant consultations, while also continuing to solicit feedback from candidates, employers, and the wider legal profession.

In a move towards increased transparency, the regulator has committed to making SQE performance data more accessible. This includes providing detailed information on outcome disparities among different candidate groups. This pledge comes after the SRA previously acknowledged a flaw in its candidate information collection methods, which prevented the publication of pass rates broken down by training provider, a commitment originally made for 2023. The SRA also plans to investigate optimal strategies for supporting candidates from diverse backgrounds in selecting appropriate training pathways and will monitor evolving perceptions of the SQE over time.

Furthermore, the SRA is already consulting on potential modifications to the Functioning Legal Knowledge (FLK) component of SQE1, prompted by feedback suggesting the assessment covers an excessive number of legal areas. In response to complaints about the exam feeling rushed and overly pressurised, the regulator has also announced plans to reduce the number of questions in SQE1 from 360 to 340, effective from January 2027. These changes coincide with recent performance data, which showed a decline in the overall SQE1 pass rate to 42% in July, a notable drop from 53% recorded in January.

The Solicitors Regulation Authority's proactive measures, including the significant SRA SQE £59 million fees budget and the commitment to SQE confidence improvements, signal a critical period of adjustment and refinement for the solicitor qualification pathway. The ongoing technical evaluation and planned consultations regarding the SQE are particularly relevant for law firms and legal educators, as these initiatives could lead to further alterations in the exam's structure, content, or assessment criteria. Such changes would inevitably impact future solicitor recruitment and the design of training programs.

These developments highlight the SRA's dedication to addressing concerns about the quality and fairness of the SQE, aiming to ensure it effectively serves as a robust gateway to the legal profession. However, the system continues to face scrutiny, with solicitor Noella Gooden cautioning that the current examination framework risks weakening the already fragile pipeline of talent entering legal aid work. This broader context underscores the importance of the SRA's efforts to enhance the SQE's efficacy and accessibility for all aspiring solicitors.

Law firms and legal educators should monitor the SRA's ongoing technical evaluation and planned consultations regarding the SQE, as these may lead to further changes in exam structure, content, or assessment criteria, impacting future solicitor recruitment and training programs. This also signals the SRA's commitment to addressing concerns about the SQE's quality and fairness.

Source: Original reporting via Legal Cheek