The Legal Services Commission—the body that distributes legal aid on behalf of the government—is to be abolished. It will be replaced by an executive agency within the Ministry of Justice. The chief executive has "resigned"—apparently with immediate effect.

The announcement will be seen as a sign that the commission has failed in the task it was given by the government 10 years ago. It has struggled for years to meet competing demands for a limited budget.

Over the years, the commission came under increasing attack from the legal profession. Its response was to try to push forward new ways of allocating funds that were largely incomprehensible to those outside the system.

Although it had been thought that the government might want to save money by taking legal aid back in-house, today's announcement was unexpected. The main purpose seems to be tighter control of the administration of legal aid.

Legislation will be required but it seems unlikely that this could be brought in before the general election. That said, this would appear to be a policy decision that the Conservatives would be happy to inherit.

The abolition of the commission was "welcomed" by its chairman, Sir Bill Callagahan. He paid tribute to Carolyn Regan -- who would be leaving "shortly" after three-and-a-half years as chief executive -- and said he looked forward to working with Carolyn Downs, the Deputy Permanent Secretary at the Ministry of Justice who will be interim chief executive while the commission is wound up.