Public Disorder: Compensation

Baroness Sherlock Excerpts

Tuesday 13th March 2012 Lords Chamber

[Lord Henley]

My Lords, my noble friend has asked quite a number of questions. Although I can assure him that we have urged the police authorities to ensure that compensation is paid as swiftly as possible to all those who are entitled, we want to make sure that it is paid only to those who are entitled. He is right to address the point that the 1886 Act—which, obviously, was passed some time ago—does not cover business interruption. That is why we think that there should be a review of the Act, and we will consider all options in due course. As I stressed earlier, we believe that some 90 per cent of those who suffered, whether businesses or otherwise, had insurance, and as likely as not that insurance would have included business interruption. The 1886 Act comes from another era when these matters were not considered. As for the planning point, I will take that on board and consult colleagues in the Department for Communities and Local Government.

[Baroness Sherlock]

My Lords, I declare an interest as a member of the Riots Communities and Victims Panel. The Minister has just told the House that 90 per cent of individuals making claims to insurance companies have been paid, and the Association of British Insurers has a similar figure—85 per cent—for small businesses, and yet only half of those claiming under the RDA have been paid. Can the Minister account for the difference? Does he think there is any truth in the rumour that the reason there is such a big difference is that police authorities are setting such a high standard for the evidential basis and the paperwork, which is way in excess of that required by commercial insurance companies? Does he think that that is causing the delay?

[Lord Henley]

My Lords, the noble Baroness makes a valid point, and I pay tribute to the work that she did earlier on these matters. However, it is also important to look at the fact that those who were not insured were the sort of people who probably did not have adequate records about what they had in their shops—and I am thinking particularly of shops—and one therefore needs to conduct the loss-adjustment process very carefully. As she will know, people often make what one might describe as overgenerous claims when they do not have the appropriate records of what they had in their particular shop or business, and those things need to be looked at carefully. However, as I made clear in my response to my noble friend, it is important that we make sure that the police deal with these matters as quickly as possible. That is what we have been urging them to do and that is why we have set in motion a number of measures to speed up the process.