Civil Proceedings and Family Proceedings Fees (Amendment) Order 2015

Lord Howarth of Newport Excerpts

Wednesday 4th March 2015 Lords Chamber

I want to make one last point and that is that equal justice is to the body politic what equal health treatment is to the human body. Would there not be an uproar if we started to do anything remotely comparable with the provisions in this order to the NHS, where equality of treatment is unassuageable? So I speak with all others in hoping that, difficult though it may be, the Government may find some way of not proceeding with these measures.

[Lord Howarth of Newport (Lab)]

My Lords, I add my thanks to the noble Lord, Lord Pannick, for tabling this amendment. I also thank him and other noble Lords for speaking in criticism of this statutory instrument. Their speeches have been principled, lucid and compelling.

It appears that I may be the only non-lawyer to participate in this debate, and I hope it will not be regarded as superfluous or intrusive if I speak simply as a citizen. To me, access to justice is fundamental to the very nature of British citizenship. The rule of law and equality before the law are, or should be, bedrocks of our constitution and our liberal society. The essential principle, which we must preserve, is that no one should be prevented from bringing a reasonable case to court for lack of financial means. This order violates that principle. The imposition of a 5% fee on claims ranging from £10,000 to £200,000 is, as noble Lords have noted, a potential increase of the order of 600%. To be required to pay £10,000 upfront as the entry fee to get into court will in practical terms be impossible for many small and medium-sized enterprises, as it will be impossible for individuals who seek to recover debts due to them or to get personal injury compensation or compensation for clinical negligence.

As has been noted, a coalition of lawyers and other expert groups has advised us that:

“These proposals will significantly reduce the ability of individuals and small businesses with legitimate claims to pursue these through the courts ... These increases represent a significant barrier to access to justice ... Increasing fees to fund court infrastructure risks ‘pricing out’ those on low and medium-level incomes, leaving access to justice in the hands of a wealthy few”.

The Ministry of Justice’s assessment of the impact of this measure is scandalously inadequate, and not for the first time. We vigorously criticised the impact assessment associated with the LASPO Bill because it was simply not good enough. In the case of the impact assessment for this measure, the Regulatory Policy Committee said in January 2014 of an earlier articulation of the impact assessment, in terms, that the impact assessment is not fit for purpose. The impact assessment that was published alongside this order in January this year is equally unfit for purpose. The criticisms do not appear to have been heeded. For example, in the section that covers key assumptions, sensitivities and risks, the impact assessment says:

“It has been assumed that fee changes will not affect court case volumes … It has been assumed that there are no detrimental impacts on court case outcomes nor on access to justice from any increase in court fees. It has been assumed that there are to be no impacts on the legal services used to pursue or defend claims”.

In the section on impact, the Explanatory Memorandum tells us:

“Some proceedings to which these fee changes apply may involve businesses, charities, voluntary bodies or public sector organisations.—We“—

that is, the Ministry of Justice—

“do not routinely collect information on people and organisations involved in court proceedings and we are not therefore able to calculate the impact that the fee increases are likely to have on these organisations”.

In the next section, on regulating small business, the impact assessment tells us:

“Some proceedings to which these fees relate will be initiated by small businesses. We do not have detailed information on the characteristics of those who bring money claims before the courts; how many of these proceedings may be initiated by, or against small businesses; and the types and value of claim they typically make. We do not therefore know what the impact of these fee increases is likely to be on small businesses”.

The Parliamentary Under-Secretary of State for Justice, Mr Vara, in seeking to advocate this measure to the House of Commons, said that,

“we must also look to those who use the courts to contribute more towards their running where they can afford to do so”.—[Official Report, Commons, First Delegated Legislation Committee, 23/2/15; col. 3.]

The Minister reiterated that thought today.

The problem is that they do not know whether potential users of the courts will in these new circumstances be able to afford to do so. I understand that there are no fee remissions for SMEs. To legislate in avowed ignorance of the impact of the legislation on those who may seek to avail themselves of legal remedy is reckless. It is breathtakingly irresponsible. The policy is also based on an improper premise that the costs of public services should be fully funded by their users. Again, the Parliamentary Under-Secretary told the House of Commons:

“The normal rule for public services is that fee income should cover the full cost of delivering such services”.—[Official Report, Commons, First Delegated Legislation Committee, 23/2/15; col. 3.]

Of course, it is the Government’s intention and it is part of what is provided for in this order that they should go beyond covering full costs; they should in certain cases exceed full costs. I quote from Paragraph 7.2 of the Explanatory Memorandum:

“The Government decided to take a power to charge fee income from courts above the full level of cost for certain proceedings”.

Two reasons are given:

“It did so to make sure that the courts are adequately funded in order that access to justice is protected”.

So they priced the courts out of people’s reach in order to make sure that access to justice is protected. It goes on to say, and this is really revealing:

“It also wanted to reduce the cost of the courts borne by the taxpayer”.

Whatever may be the case in certain areas of government, there is plainly not an expectation that the cost of public services should be covered by fees charged to their users. Obviously it is not the case in the National Health Service or where schools are concerned and whatever may have been the tradition and the practice in the justice system I suggest that this cannot be a paramount principle. The paramount principle is to ensure access to justice. I believe that the overwhelming majority of our fellow citizens accept that there is a social contract. They may not use that language but they understand and accept that they must pay the taxes needed to ensure that there is equal access to justice.

There has been too much cant in too many pronouncements from Ministers at the Ministry of Justice. I immediately except from that charge the noble Lord, Lord Faulks. He may be briefed to utter cant but he would never originate cant. However, I am afraid to say that his colleague in the House of Commons has been less fastidious. He said in the ministerial foreword to the response to the consultation that was published in January 2015:

“I am proud that we live in a country which operates under the rule of law, and where we have such a strong tradition of access to justice … It is vital that these principles and qualities are preserved so that people can continue to have ready access to the courts when they need it”.

That is his commentary in response to the consultation on the very measure we are debating this evening.

The Lord Chancellor himself, Mr Grayling, at the Global Law Summit, to which reference has already been made, said that we continue to innovate and develop our policy at the Ministry of Justice but always consistent with the principles of Magna Carta. It simply is not so. The Parliamentary Under-Secretary, in talking about the financial context of this policy, again in the response to the consultation, talked about having reduced spending on legal aid so the scheme is more affordable. This is the Alice in Wonderland logic the ministry employs. By more affordable of course he means for the taxpayer, not for the citizen who needs to have recourse to the justice system. He boasted that,

“we have reduced staffing levels in our headquarters functions, and in the headquarters of our agencies”.

However, what he did not mention in that document was the money that the Ministry of Justice has wasted on information technology. I quote from the Guardian of 30 June 2014:

“The Ministry of Justice has written off £56m spent on an IT project after discovering it was late, over budget and duplicated by another department”.

The write-off was equivalent to about a quarter of the amount being cut from the legal aid budget.