Prisons and Courts Bill

David Nuttall Excerpts

2nd reading: House of Commons
Monday 20th March 2017 Commons Chamber

[Mr David Nuttall (Bury North) (Con)]

It is a privilege, as always, to follow my hon. Friend the Member for Shipley (Philip Davies), and I very much look forward to supporting some of the amendments he foreshadowed in his speech.

At the outset, I must draw the House’s attention to my entry in the Register of Members’ Financial Interests, as I am on the roll of solicitors. I am a non-practising solicitor now, but earlier in my career I was involved in many personal injury matters, and it is to part 5 of the Bill, which deals with whiplash, that I want to restrict my remarks.

There are things to commend and welcome in the Bill, but the one area where I do have concerns is over the proposals relating to whiplash. It is completely understandable that the Government would want to root out fraudulent whiplash claims, and I am sure everybody would agree with that, but I am not convinced that the proposals in part 5 will assist in achieving that aim. I welcome the fact that the Government have abandoned some of the more extreme proposals in the consultation paper, but we have nevertheless finished up with a set of proposals that I doubt will have the desired effect.

There is no doubt that if fraudulent claims are submitted and not spotted, the damages that are paid out will increase premiums. However, I am not convinced that the way to reduce premiums is to restrict artificially the level of damages payable by someone found liable for the tort of negligence. The Government’s proposal has nothing to do with controlling public expenditure; we are told that it is all about rooting out false, fraudulent claims and trying, as a consequence, to reduce insurance premiums. If the Government are really keen to do that, one way would be to reduce insurance premium tax. It seems rather perverse that we should tax those who seek to do the right thing. I can understand the argument—I might not always agree with it—for taxing goods or behaviours that are perceived to be bad, but it is less easy to understand the rationale for taxing those who seek to do the right thing by taking out insurance to protect themselves and take care of their future.

There are already procedures in place to reduce the potential for fraudulent claims to be successful. I am all in favour of taking the strongest possible action to root out those who try to con the system, but perhaps we should have given the existing measures—it is not many years since they were introduced—more time to work, and there is already evidence that they are working. The number of whiplash claims, as reported to the compensation recovery unit at the Department for Work and Pensions, fell from 511,111 in 2010-11 to 335,365 in 2015-16.

[Sir Oliver Heald]

The expression we use is whiplash-related road traffic injuries. Some of them are described as upper torso strain caused by shunt by a vehicle; that is a whiplash-related claim, and it would not count as a whiplash claim, but we think they are the same thing, and we reckon that the figures show a 50% increase over the last 10 years, at a time when the number of road traffic accidents generally has been falling.

[Mr Nuttall]

Clearly, there are issues around the definition of what constitutes a whiplash injury. The fact remains that, under the definition of whiplash used by the CRU, there was a 34% fall between 2010-11 and 2015-16.

Regardless of the number of claims, if they are valid, appropriate damages should be paid. The introduction of tariffs will have a number of effects, particularly when combined with the proposed increase in the small claims limit, which I accept is not in the Bill but is foreshadowed in the Government’s proposals. First, the level of damages will hardly ever be correct, as the Government recognise in their proposed uplift provisions. This is a rather clumsy way to try to finesse the basic scheme, recognising that the damages will not be at the appropriate level. There will inevitably be an increase in the number of litigants in person, and that raises questions as to how the courts will cope. For example, is the portal proposed as the mechanism by which the system is accessed intended for use by litigants in person?

Claims management companies will have a field day as they look to expand their operations in the light of these proposals. I fear that there will inevitably be an increase in the number of nuisance telephone calls. The Government may feel that insurance premiums are a problem, but that is as nothing compared with the problem of nuisance telephone calls. I am sure that I am not alone among MPs in being able to say that I hardly ever get a complaint about insurance premiums in my postbag or email inbox, whereas I get many, many complaints about the number of nuisance telephone calls.

Another problem resulting from the introduction of tariffs is that the same injury will attract a different level of compensation dependent on whether the injury was suffered as a result of a road traffic accident or in the workplace. I am not sure how that could be justified to the injured person, but I look forward to hearing the explanation of how it could be justified. There will inevitably be a transfer of cases from qualified legal practitioners to unqualified claims companies—McKenzie friends and so forth—and thousands of high street practices will face closure or, at the very least, job losses. There will also be unintended consequences. For example, the Access to Justice Action Group has pointed out that an injured party would be entitled to £3,725 for a neck injury lasting 24 months under the small claims track, but £6,750 for a neck injury lasting just one month longer outside the small claims track. That will be an incentive for the small minority who try to play the system to exaggerate their claims.

In summary, why should the vast majority of innocent, law-abiding citizens be penalised for the actions of the dishonest few?