Civil Liability Bill [Lords]

Chris Philp Excerpts

3rd reading: House of Commons & Report stage: House of Commons
Tuesday 23rd October 2018 Commons Chamber

[Gloria De Piero]

My hon. Friend is absolutely right. Even if we use RPI, the Government still do not get to their proposed £2,000 new small claims limit. Instead, using the flawed RPI from 1999 would take the £1,000 to roughly £1,700. That is what we on the Labour Benches suspect is going on here.

[Chris Philp (Croydon South) (Con)]

The hon. Lady is making an argument about whether RPI or CPI should be used, but is there not a bigger point here? For almost all claims generally, outside this area, the small claims track limit is £10,000. If we are to be consistent, is there not a case for making it £10,000, the same as everything else?

--- Later in debate ---

[Gloria De Piero]

My hon. Friend is absolutely right. It is not an easy thing to take a case against your boss. You need a lawyer to hold your hand, an expert to talk you through, and the Government’s proposals are going to make that so much more difficult. She makes an appropriate point.

New clause 2 would ensure that children and protected persons, for example those lacking mental capacity, are treated the same as other vulnerable groups by excluding them from the small claims limit increase for whiplash injuries. Having made a welcome concession on Second Reading, and clarified in Committee that they would exclude vulnerable road users from the impact of the Bill and secondary measures on the small claims court limit, the Government appear to have forgotten others. Horse riders, pedestrians, motorcyclists and cyclists are rightly to be excluded from the changes, but some of the most vulnerable in our society, who are currently recognised by the courts as requiring special status, will be left, with everybody else, facing a new small claims limit of £2,000 or £5,000. As it stands, any settlement awarded to those who lack capacity to conduct their own proceedings, such as children or someone suffering with a mental disability, must be rubber-stamped by a judge because of the claimant’s recognised vulnerabilities. That will continue to be the case after these changes are introduced.

The law requires children and other protected people to have a litigation friend to conduct proceedings on their behalf. In the small claims court, those who provide this required representation are not and will not be paid for their time. Yet by increasing the small claims limit, there will be a significant increase in the number of people coming through the small claims court with higher-value and more complex cases, where they need a lawyer more than ever. We are asking a litigation friend to take on potentially complicated matters for those most in need, on their own, in their own time, for no pay. Injured horse riders, cyclists and pedestrians and motorcyclists will not be subject to a tariff. The small claims limit for them will remain at £1,000, meaning that they will get a lawyer to act for them for free in any case over that value.

Can the Government not see that children and protected persons need this support, too? How on earth can the Government justify protecting one vulnerable group but not another? Why is the horse rider worthy of exemption, but not a child or a person without the capacity to conduct proceedings? Are we really willing to let some of the most vulnerable people in our justice system be left simply to hope for the good will of others to protect their interests because we in this House have failed to do so?

I know that the Minister is aware of this issue from discussion in Committee with my hon. Friend the Member for Enfield, Southgate (Bambos Charalambous). The Minister suggested returning to this point and that he would be very interested to see an amendment tabled. So here is his chance: a ready-made amendment that makes a simple correction and is an opportunity for the Government to rectify what I presume is an oversight. It simply extends the exemption already provided to others. It removes children from the changes being made to the small claims limit or tariff, and ensures that protected groups are excluded from the increase, the same as horse riders, cyclists and pedestrians. It removes the double standard of some vulnerable road users being granted an exemption and others not. Ultimately, it does little more than extend the protections already afforded to some and allow the Government to show that they care for all.

[Chris Philp]

Thank you, Mr Speaker, for calling me so early in this debate. I rise to oppose the Opposition’s new clause 1, which seeks to prevent the Government or any other public body from increasing the small claims track limit in relation to these personal injury cases, particularly road traffic personal injury cases, above £1,500.

I strongly oppose the measure. I touched on one of the reasons for doing so in my intervention on the shadow Minister earlier. For the vast majority of general commercial claims and indeed personal claims, the small claims track limit is £10,000. The reason it is as high as £10,000 is that some level of materiality is applied to the claim in question. The view taken by Parliament in the past, rightly, is that matters below the £10,000 limit should be sufficiently simple for a small claims track procedure to be used without the involvement of often very expensive lawyers.

In response to my intervention, the shadow Minister, before she was distracted by another intervention, drew attention to the fact that these are personal injuries. I accept that point, of course. However, the fact of their being personal injuries is not germane, in my view, to the question, which is: is the matter sufficiently simple to be adjudicated via the small claims track rather than through lawyers? That is the question—not whether the matter is serious or not serious but whether the matter is sufficiently simple to be dealt with properly by the small claims track rather than through lawyers. That is why I think there is a strong a case, on the grounds of consistency, for a £10,000 rather than a £5,000 limit.

[Ruth George]

In road accident claims and particularly in employment liability cases at work, establishing who is to blame for an accident is far from simple. It is an extremely different sort of case from that of establishing whether a fridge was working or not when it was bought, or whether there is something wrong with a car. I really think the hon. Gentleman is not doing justice to the victims of personal injury accidents by the arguments that he seeks to make.

[Chris Philp]

Of course the £10,000 small claims track limit applies to a far wider range of issues than simply whether a fridge functions or not. The hon. Lady mentions as an example the question of culpability for a road traffic accident. Given that we are talking about much less serious types of injury if the limit is, say, £5,000, determining responsibility for that road traffic accident does not need to be an enormously complicated procedure. For those of us who have been involved in such road traffic accidents, the minor ones we are talking about here, determining responsibility is not a highly complicated matter. I accept that, in much more difficult cases where very serious injuries have been suffered, one must of course take a lot more legal care and attention. For very minor injuries, however, where by definition the accident is a minor one, I suggest that determining responsibility and culpability does not need to be an extremely complicated matter.

[Andy Slaughter]

With the greatest respect, I do not think that the hon. Gentleman knows what he is talking about. Given of the relatively low levels of compensation for injury, the effects of a £5,000 injury can be quite severe and debilitating over a period of time. The complexity of personal injury cases, which involve expert evidence and issues of causation, means that they are in a different category. Even the Government accept that, so he is batting on a rather poor wicket.

[Chris Philp]

The hon. Gentleman’s arguments are ones that the legal community often advance, whether in this arena or others, to justify very high levels of legal and judicial intervention, which is often very expensive. We need to maintain a sense of proportionality, lest legal costs and expenses get out of control.

[Robert Neill (Bromley and Chislehurst) (Con)]

Will my hon. Friend give way?

[Chris Philp]

I shall in just a moment. I have seen figures suggesting that 47% of the pay-outs made by insurance companies for these relatively minor road traffic injuries get consumed by legal fees. If such a high proportion of pay-outs is being consumed by expenses, it suggests to me that the entire system is out of proportion, and that some reform is therefore needed. I give way to the Chair of the Justice Committee.

[Robert Neill]

I am afraid that my hon. Friend is not making the best case on the Government side that I have ever heard. Does he accept that lawyers act in the interests of their clients and that when they do, they are bound by professional obligations? Is not a better point that we should assist people through the system by working up a very good and accessible online portal, which the Minister has sought to do, so that we find the means of balancing cost with people’s ability to seek access to justice? I gently say to my hon. Friend the Member for Croydon South (Chris Philp) that that is perhaps a stronger point that the Government have been able to advance. The Minister has taken care to delay the implementation of aspects of the Bill in order to get the online portal up and working, and I suggest that that might be a more fruitful area to consider.

[Chris Philp]

I am always delighted to take advice and guidance from such a distinguished, learned and experienced Member as my hon. Friend the Member for Bromley and Chislehurst (Robert Neill). He adds further weight to the case by drawing attention to the benefits of the online portal, which I hope could be used to further simplify such matters and enable claimants to manage them, rather than having to rely on lawyers.

[Jo Stevens (Cardiff Central) (Lab)]

I refer the House to my entry in the Register of Members’ Financial Interests. Is the hon. Gentleman aware that in most personal injury claims, there are fixed costs for lawyers’ fees?

[Chris Philp]

In many cases there are, but in many cases those costs inflate. I referred to the fact that 47% of the value of pay-outs get consumed by legal fees. I hope that the fixed tariffs provision, which is not the subject of any amendment but is in the Bill, will further simplify matters.

One reason why we have a problem that needs solving in this area—new clause 1 would inhibit that solution—is qualified one-way costs shifting, which was introduced a few years ago. I understand why it was introduced—the shadow Minister referred to David and Goliath—but under a system of qualified one-way costs shifting, unless the respondent can prove quite a high level of intention, deceit or malfeasance, the claimant’s legal costs are borne by the respondent in any event, even if the claim is dismissed. That creates significant moral hazard, as it means that claimants can bring claims, even if those claims have relatively little merit, safe in the knowledge that they, or indeed their advisers, will never have to bear the cost of the claim. It is a one-way bet, which means that claimants may as well just have a go and see what happens. The number of cases in which a claimant is shown to be so egregiously fraudulent that they have to pay the cost is extremely small. This one-way bet—this free option—that the legal system now provides is one of the reasons why there has been such an explosion in claim numbers.

[Craig Tracey (North Warwickshire) (Con)]

I should declare that I chair the all-party group on insurance and financial services. I agree with my hon. Friend’s opposition to the new clauses. Does he have any thoughts on why personal injury claims have risen by 40% over the last decade, yet during the same period, cars have become safer and accidents have reduced by nearly a third?

--- Later in debate ---

[Chris Philp]

My hon. Friend is right—he makes exactly the point that I was about to come on to. Over about a decade in which accidents have reduced by 30% and cars have become safer, the number of claims has gone up by 40%. He asks why, and I think it goes back to qualified one-way costs shifting. There is a huge financial incentive for claimants to have a go—encouraged, of course, by claims management companies—in the hope that they can make a successful claim. Defendants, typically insurance companies, have rather irresponsibly taken the view that because defending one of these claims—probably successfully—will cost £10,000 or perhaps more, they should simply choose to settle, which may involve paying out £3,000 or £4,000, without bothering to defend the claim. Obviously word has spread both in the claims management community and among the wider public that people can simply make a claim and the insurance company will settle, because it is cheaper for them to settle a bad claim than to fight it. That has created the most extraordinary perverse incentives. Insurance companies have been seriously at fault, as they have set up this situation by paying out for claims with no merit, for understandable commercial reasons, but they have made a big mistake, and we now have to correct it through the Bill.

My hon. Friend asks why the number of claims has increased so dramatically. It is because claims management companies have been phoning around, encouraging the public to submit fraudulent claims, and I will elaborate on that in a moment.

[Bambos Charalambous (Enfield, Southgate) (Lab)]

The hon. Gentleman makes my point for me in saying that insurance companies are paying up on a regular basis. They are not even defending these claims, yet the Bill is designed to protect them. What does he say about that?

[Chris Philp]

The companies are not defending the claims because qualified one-way costs shifting makes it more expensive for them to successfully defend a claim than simply to pay it out. The system simply is not working.

[Sir Edward Davey (Kingston and Surbiton) (LD)]

Does the hon. Gentleman think that any genuine claimants will be hit by this measure and will not receive the compensation that they should get?

[Chris Philp]

The right hon. Gentleman raises a fair concern. Of course, we need to make sure that we do not overcompensate and find ourselves in a situation in which genuine claimants are prevented from claiming. The way in which we are legislating strikes that balance and genuine claimants can still make a claim. My hon. Friend the Member for Bromley and Chislehurst referred to the use of an easy-to-operate online portal as a way of ensuring that claims can be handled easily, even by laypeople. The concern that the right hon. Member for Kingston and Surbiton (Sir Edward Davey) raises is reasonable, but I think that the Government have addressed it in their handling of the matter. However, I am sure that the Minister will comment further on the right hon. Gentleman’s point.

[Eddie Hughes (Walsall North) (Con)]

This might be a peculiar counter-intuitive point, but it is often the case that whiplash claims are associated with bad headlines in the press. People think that the numbers of claims are dramatically exaggerated. Perhaps it might be helpful if we send a message from the Chamber about discouraging fraudulent claims, which would mean that people with a genuine claim would be more likely to have their cases dealt with more quickly.

[Chris Philp]

As always, my hon. Friend makes a very good point. As Members of Parliament, we should send out a clear message to our constituents and the wider public that making fraudulent claims is not a victimless crime. They affect the insurance premiums that all of us and all our constituents pay. Fraudulent claims are extremely bad for society as a whole. They encourage a sense that people can somehow get money without really deserving it, which is morally corrosive as well as financially damaging.

[Jo Stevens]

I am sure that no one in the Chamber thinks that we should encourage fraudulent claims—absolutely not—but may I bring the hon. Gentleman back to some facts? Between 2015 and 2017, the number of registered claims for whiplash fell by 15%, while the number of claims being reported through the police also fell, which might have something to do with the 37% reduction in the number of road traffic police officers in the last 10 years.

[Chris Philp]

Clearly the number of injury claims made via an insurance company is not related to the number of police officers on the street. The hon. Lady mentions the slight but welcome reduction in the number of whiplash injuries. Over the same period, the number of claims to insurance companies for back injuries has increased, so the total number of claims is down only very slightly over the last couple of years, and is still dramatically up over 10 years, which is clearly a more meaningful period. When the two are taken together, therefore, there has not been a significant reduction.

[Robert Neill]

Will my hon. Friend give way?

[Chris Philp]

How could I possibly resist my hon. Friend?

[Robert Neill]

The House will know about my declaration in the Register of Members’ Financial Interests. I am glad that my hon. Friend has mentioned claims management companies. Would he agree that some of the concerns about balancing access to justice with discouraging fraudulent claims—we all agree about them—would be met by continuing to revise and strengthen the regulation of claims management companies, which are not regulated to the degree that solicitors are, and in particular by bearing down on the employment of paid McKenzie friends—non-qualified, quasi-lawyers who are particularly rife in the claims management sector? Will he work with me in persuading the Government to move swiftly to ban them?

[Chris Philp]

Once again my hon. Friend makes a very good point—two very good points, in this case. The operation of claims management companies, which have been actively engaged in encouraging the public to commit fraud, has had an extremely negative effect in this area. I want an outright ban on them making cold calls, but I am slightly concerned that even if the Government take all the action that he and I would like, these people, being extremely adept in such matters, would adapt their behaviour to circumvent the legislation and regulation. For example, they might start making cold calls from outside the UK’s legal jurisdiction, as we saw following the ban on referral fees that came into force two or three years ago. Insurance companies were banned from receiving referral fees from claims management companies, but some insurance companies and claims management companies sought to circumvent the ban by setting up what they euphemistically termed “alternative business structures”, whereby the claims management company effectively remunerated the insurance company via an equity stake rather than a referral fee. I am therefore concerned that even if we take all the action we can, these often rather dubious characters will find new and ingenious ways of circumventing the legislation.

[Ellie Reeves (Lewisham West and Penge) (Lab)]

I welcome the fact that the hon. Gentleman supports an outright ban on cold calling by claims management companies, but does he agree that the Government’s measures in the Financial Guidance and Claims Act 2018 do not go that far? Rather than punishing injured victims, would it not be far better to introduce that outright ban on claims management companies’ cold calling?

[Chris Philp]

As I said a moment ago to my hon. Friend the Member for Bromley and Chislehurst, an outright ban would be welcome—it might be something the Government are looking at in any case—but because these people are so ingenious at circumventing even the best-written rules and regulations, there would still be a problem.

[Huw Merriman (Bexhill and Battle) (Con)]

I thank my hon. Friend for giving way—he is being most generous with his time. May I press him on the point made by my hon. Friend the Member for Bromley and Chislehurst (Robert Neill) about McKenzie friends? I am going back years now, but in my day, when I first started at the Bar, the concept worked very well: they were volunteers who accompanied people to court and assisted them, and they certainly were not paid. Surely we just need to go back to the system as was, as I suggest that things would then work very well.

[Chris Philp]

I agree wholeheartedly with my hon. Friend, who I know has a distinguished legal background. Both he and the Chair of the Justice Committee have powerfully made the point that McKenzie friends should be voluntary and unpaid. I hope the Minister heard that excellent recommendation, which has now been made by two learned hon. Members of this House.

[Sir Edward Davey]

I congratulate the hon. Gentleman on making a speech against the Bill. He has admitted that the insurance companies should be fighting the claims, that McKenzie friends should not be paid and that claims management companies should be regulated. He might not have realised it, but he has defeated the Bill by himself.

[Chris Philp]

I am grateful to the right hon. Gentleman for granting to me such wide-ranging powers of persuasion, but I am not speaking against the Bill; I am speaking only against new clause 1. Despite all the measures we have just been discussing, including the three that the right hon. Gentleman mentioned, I do not think that they, on their own, will be enough, for the reasons I have outlined. The financial incentives created by qualified one-way cost shifting will remain, and claims management companies will find ways of circumventing any tightening of the rules that might be legislated for separately. There is no question but that the British public are being incited to submit fraudulent claims on an industrial scale—[Interruption.] The shadow Minister, the hon. Member for Leeds East (Richard Burgon), is tut-tutting and shaking his head in a way that leads me to believe he disagrees with that statement—I think that I have fairly summarised his view.

[Eddie Hughes]

Will my hon. Friend give way?

[Chris Philp]

I was about to reply to the shadow Minister’s implied disagreement, but go on then; I give way.

[Eddie Hughes]

I just wondered if my hon. Friend would comment on a previous interaction between me and my hon. Friend the Member for Bexhill and Battle (Huw Merriman) about stock car racers, who obviously are involved in multiple collisions and yet do not seem to suffer any whiplash, or at least not to the same extent as others. In addition, people in Greece make far fewer claims than we do in the UK. Will he comment on that?

[Chris Philp]

Once again, my hon. Friend makes an excellent point. Not only has the number of claims for such injuries dramatically increased over the past 10 years, at a time when the number of road traffic accidents has fallen, but they are far more prevalent here than in other European jurisdictions—not just Greece but countries such as France and Germany. Could it be that British necks are weaker than French and German necks, or could it be that our system encourages fraudulent claims?

[Ruth George]

The hon. Gentleman, who is making an excellent speech, has answered his own question. He has talked about the prevalence of claims management companies and the way they are inciting people to make claims on an industrial scale. Surely those claims management companies, and the insurance companies they are linked to in most cases, should be bearing the brunt of this problem, not the innocent victims of accidents, as would be the case under the Bill.

[Chris Philp]

The hon. Lady evidently agrees that claims management companies have been inciting fraud on an industrial scale—a point of view that her Front-Bench colleague perhaps disagrees with. That said, claims management companies are only part of the problem. As I said, the incentives inherent in the system have encouraged the kind of behaviour I have been describing.

I want to come to the implied sedentary disagreement from the shadow Minister earlier. I inferred from his gesticulation that he disagreed with my suggestion that claims management companies were inciting fraud on an industrial scale. I will start with a personal anecdote, which I realise does not make the general point, but I will then come on to that more general point. My interest in this area stems from personal experience. About three or four years ago, just before being first elected, I had a minor road traffic accident while driving along the M5 to Cornwall with my wife and our two small children. [Interruption.] I think I am being heckled by the Chair of the Justice Committee.

Nobody was injured in the accident—the bumper was a bit dented, but that was it. It happened at low speed, the traffic having slowed down. For about a year, however, I was bombarded with calls to my personal mobile by people from claims management companies, I think, that had somehow found out about the bump, trying to persuade me that I or my family had suffered a neck injury. No matter how often or how insistently I told them that everyone was fine, they would say things such as, “If you just say your neck hurts, you’ll get £3,000.” The incitement to commit fraud was clear and direct. Subsequently, as recently as in the last two or three months, I have received repeated automated calls—robocalls—again to my mobile, although wholly unrelated, I think, to the first set of calls. I received a recorded message saying, “We are calling about your accident. Do you want to talk about it?” There was then a pause during which I was expected to reply. That is clearly happening on an industrial scale.

[Jo Stevens]

Who does the hon. Gentleman think sold his details to that claims management company?

[Chris Philp]

In the first instance, it was very likely to have been an insurance company that had been circumventing the referral fee ban through an alternative business structure, which is a practice that I wholly deplore, and I encourage the Government to ban it. However, as I have said three or four times before, simply trying to legislate away claims management companies will not in itself be enough when the incentives inherent in the system are so powerful. Raising the small claims track limit to, say, £5,000—which is still half the level of the general small claims track limit—will serve to diminish the financial incentives in the system whereby lawyers are taking nearly half the value of pay-outs.

[Several hon. Members rose—]

[Chris Philp]

I give way to the hon. Member for Hammersmith (Andy Slaughter).

[Andy Slaughter]

The proportion of fraudulent claims is about 1%. If I understand the hon. Gentleman’s argument correctly, he is saying that all meritorious claimants should be debarred from proper representation so we can identify that 1%, because it is too difficult for the Government to legislate. Is not the truth of the matter that the Government, as always, are joined at the hip to the Association of British Insurers, and are simply legislating in its interests?

[Chris Philp]

I disagree with all three things that the hon. Gentleman has said. First, as I said earlier to the right hon. Member for Kingston and Surbiton (Sir Edward Davey), the Government have no intention at all of preventing legitimate claims from being made. The Government are keen to facilitate those claims, and the online claims portal will help with that. There is categorically no intention of disbarring, preventing or in any other way inhibiting legitimate claims from being made.

Secondly, the hon. Gentleman referred to the 1% fraudulent claims figure. The reason the reported figure, which in my submission is dramatically under-reported, is so low is that insurance companies are, quite wrongly, choosing to settle those claims—even suspicious claims, even claims without merit—without defending them, because the cost of defending them, which is about £10,000 or £15,000, far exceeds the value of the pay-out. So the 1% figure cited by the hon. Gentleman goes nowhere close to reflecting the true scale of fraudulent claims in this area.

[Sir Edward Davey]

Will the hon. Gentleman respond to a general point? Does he believe that when we are tackling a problem, in any aspect of society, we should deal with the symptom or the cause?

[Chris Philp]

Of course we should deal principally with the cause, and that is what the Bill seeks to do. [Interruption.] The right hon. Gentleman asked about causes. We can talk about claims management companies and we can talk about referral fees—those are important issues to deal with—but the cause of this problem is the financial incentives created by qualified one-way costs shifting, whereby claimants, aided and abetted by claims management companies, can have a crack for free, suffering no loss if their unmeritorious claims are dismissed. If the right hon. Gentleman wants to go into the cause of the problem, that is the cause of it, and elevating the small claims track limit to £5,000 will do a great deal to eliminate the cause. If he wishes to address the cause, as his intervention implied, he should vote against new clause 1.

[Several hon. Members rose—]

[Chris Philp]

I give way first to my hon. Friend the Member for Bexhill and Battle.

[Huw Merriman]

I thank my hon. Friend for giving way again. It is not just the case that we do not really know the number of fraudulent cases, although we can certainly make a very fair estimate, given that there are 200,000 extra claims and 85% of them relate to whiplash. The real issue is that we tend not to see any medical reports because of the settlements. It is not just that the cases are not defended; we never see the medical reports, so we do not know exactly what the full figure would be.

[Chris Philp]

My hon. Friend is absolutely right. Because the claims are settled upfront by the payment of, typically, £3,000 or £4,000, there is often no medical examination. There is therefore no evidence on which to assess whether the claim was fraudulent or not, which is why the 1% figure cited by the hon. Member for Hammersmith (Andy Slaughter) is essentially meaningless.

One of the other provisions in the Bill, which we debated on Second Reading, is the requirement for a medical examination to take place before an offer is made. That is an essential reform. In response to an intervention from me, the Secretary of State for Justice confirmed that such medical examinations would have to be face to face. That would begin to address the issue that my hon. Friend the Member for Bexhill and Battle (Huw Merriman) has rightly raised.

[Jo Stevens]

I thank the hon. Gentleman for giving way to me again; he is being very generous. He mentioned the purpose of raising the small claims limit to £5,000, and what that would do. What it will do is deny victims of injury access to justice, as the Government’s own impact assessment expressly states.

[Chris Philp]

I do not accept the premise of the hon. Lady’s intervention. I think that in the case of the smaller claims, whose value is less than £5,000, it is perfectly possible and perfectly reasonable for individuals to submit their own claims—these are relatively simple matters—using the online portal to whose importance my hon. Friend hon. Member for Bromley and Chislehurst drew our attention earlier. Members have also referred to the role that unpaid McKenzie friends can play in assisting members of the public who submit claims. I do not accept the suggestion that bona fide claims will be prevented or inhibited by the proposed reforms.

[Several hon. Members rose—]

[Chris Philp]

The hon. Member for Glasgow South West (Chris Stephens) has tried several times to intervene, so I must give him an opportunity to make his point.

[Chris Stephens (Glasgow South West) (SNP)]

I am grateful to the hon. Gentleman, because he has been generous. May I put a different scenario to him, because this aspect of what he is saying is confusing me? If, in the course of his employment, a resident of Glasgow South West were injured in Croydon South, why would he be treated less favourably because the injury was sustained in the hon. Gentleman’s constituency than he would be in the constituency of Glasgow South West? In Scotland personal injury claims are exempt from the small claims limit, and civil legal aid is available to claimants.

[Chris Philp]

I infer from the hon. Gentleman’s question that these matters are devolved in Scotland. Is that the case?

[Chris Stephens]

It is a different system.

[Chris Philp]

The two cases are treated differently because there is an entirely different legal system in Scotland, and there is a devolved Government there. It is perfectly within the competence of that devolved Government to take a different view. Clearly the Government in Scotland, and the Scottish Parliament, have taken a different view, as they are entitled to do so, but I, as an English MP—as a London MP—take my own view, and it is the one that I have been expressing here today.

[Chris Stephens]

I thank the hon. Gentleman for that, but does he realise that the Bill affects 407,000 people—Scottish residents who are employed in England and Wales?

[Chris Philp]

It may well affect residents of Scotland. Of course, it also affects residents of France, Germany, the United States and Kazakhstan who may choose to visit my constituency. I strongly encourage all of them to do that, by the way. If, heaven forbid, they were to suffer an injury in Croydon South, they would be equivalently affected. The mere fact that there are different rules in different jurisdictions is no reason not to change the rules in this one. Which jurisdiction is the hon. Gentleman suggesting that we align ourselves with? Scotland? France?

[Chris Stephens]

Scotland!

[Chris Philp]

While I admire the hon. Gentleman’s patriotism in inviting us to follow the Scottish example, I am afraid that this Parliament will form its own view on what is appropriate, and I do not think that he can be in any doubt about what I think the right view is on the question before us today.

[Ruth George]

The hon. Gentleman is indeed being very generous. However, he constantly claims that the injuries sustained in road traffic accidents are minor. Written into the Bill is that an injury caused by the

“rupture of a…tendon or ligament in the neck, back or shoulder”

that lasts for up to two years will be included within the limits. Does the hon. Gentleman agree that that sort of “minor injury”, which could affect people for such a large portion of their lives, should be included?

[Chris Philp]

The Government consulted extensively on the definitions before legislating. I understand that the definition to which the hon. Lady has referred was recommended by the Sentencing Council, and I would certainly not wish to second-guess or naysay the recommendation of such an august institution.

I did not quite have the opportunity to finish a point that I was making in response to the hon. Member for Leeds East who, some moments ago, was expressing disagreement with my suggestion that claims were being farmed on an industrial scale. I have given my own personal example, but I also want to submit to the House, in support of what I said, an example uncovered by The Sunday Times in July 2015. It involved a company called Complete Claim Solutions, which was based principally in Brighton but also had an office in the Borough of Croydon—although not in my constituency, I hasten to add. It was discovered to be systematically encouraging members of the public to submit fraudulent claims. It was such a disreputable organisation that it used the film “The Wolf of Wall Street” as an instructional video illustrating the kind of behaviour it considered appropriate. This is no small company; it was responsible for making no fewer than 7 million outbound calls per year. One of its salespeople, Tom Murray, was recorded boasting to a journalist from The Sunday Times that he was able to easily persuade the public to lie. He said that

“if they want that £2,000, they’ll lie.”

He also said:

“When it comes down to a woman who’s had an accident…I’ll make her cry”

as a way of persuading her to make a claim.

That is just one example of the shocking behaviour of these claims management companies, in this example one making 7 million calls per year.

[Several hon. Members rose—]

[Chris Philp]

I have taken up a great deal of the House’s time. [Interruption.] I am glad that I have at last said something that finds favour with the Opposition Front Bench. I am sure many other colleagues wish to contribute to this debate.

There is overwhelming evidence that our system is broken, in terms not only of the claims management companies and the use of alternative business structures to get information into their hands, but of the fundamental incentives inherent in qualified one-way costs shifting. The proposals the Government are contemplating to increase the small claims track limit will do a great deal to choke off this problem at source—to deal with the cause, as the right hon. Member for Kingston and Surbiton requested a few moments ago. For that reason I will be energetically and enthusiastically voting against new clause 1.