Motor Vehicles (Compulsory Insurance) Bill

Greg Knight Excerpts

3rd reading
Friday 28th January 2022 Commons Chamber

[Mr Peter Bone (Wellingborough) (Con)]

I beg to move, That the Bill be now read the Third time.

I thank my right hon. Friend the Member for Hemel Hempstead (Sir Mike Penning) for giving the Queen’s consent. I thank all those who have supported the Bill, particularly those were selected for and attended the Bill Committee without whom it could not have progressed. I was thinking that to speed things up, I could just say, “This Bill is going to save the average motorist 50 quid a year and is one in the eye for the European Court of Justice”, but we probably need to do a bit more than that. The expressions of Opposition Members tell me that I better press on.

My Bill, which received Second Reading on 29 October last year and passed Committee stage on 5 January this year, deals with an issue that was considered in detail during a Westminster Hall debate entitled “Motor Insurance: Court Judgments” on 22 September 2021. That debate was led expertly by my right hon. Friend the Member for Chipping Barnet (Theresa Villiers), who cannot be here today, but I thank her for all her continued support for the Bill.

As an aside, when we have presentation Bills, it is a very good idea, if there is not time in this Chamber for us to debate Second Reading for as long as we would like, to obtain a Westminster Hall debate so that we can get the issue discussed at length before coming to this Chamber. That is a very good example of what happened.

The Bill’s purpose is to remove the requirement for compulsory motor insurance for vehicles used exclusively on private land and for a wide range of vehicles not constructed for road use. People might say, “You don’t have to have motor insurance for vehicles used on private land or for vehicles that are not a motor vehicle.” They would be right that that is the interpretation of the Road Traffic Act 1998 that has stood since its inception. That interpretation was held to be correct by the Government, motor insurance and motorists alike, but then along came the ECJ and the Vnuk case.

In 2014, the ECJ made a decision that confounded the European Union and the British Government. The case of Vnuk extended the requirement for compulsory third-party motor insurance far beyond the scope of the Road Traffic Act. If the ruling is allowed to be enforced in our courts, it will put ordinary people in breach of the law for not having motor insurance for their vehicles used exclusively on private land. To give just a few examples, motor insurance will become compulsory for a golf cart that never leaves the golf course, a ride-on lawnmower that someone uses in their back garden and a tractor-trailer that is never designed to leave the farm. It would also extend compulsory motor insurance to machines that were never intended to be used on any road.

The Road Traffic Act 1988 requires that motor vehicles intended for use on roads and other public land must be insured. It does not require compulsory insurance for vehicles on private land, nor does it require compulsory insurance for vehicles not intended to be used on roads. The whole purpose of this Bill is to return the law of this land to that envisaged in the 1988 Act.

[Sir Greg Knight (East Yorkshire) (Con)]

I congratulate my hon. Friend on getting so far with his Bill. I chair the all-party parliamentary historic vehicles group and meet many motorists and motoring organisations, including those connected with motorsport, and I have yet to hear a single objection to the measure he proposes. Is he aware how much widespread support he has?

[Mr Bone]

I am very grateful to my right hon. Friend, who has been a staunch supporter of this Bill. To his point, there has been no objection; in fact, there has been tremendous support. I am afraid that in the whole process, the only person who has bowled a bouncer is him—but I will come to that later.

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[Mr Bone]

Nice try! It is important that the motor insurance industry knows that the Bill is making progress, so it has not put the £50 on. If we do not do it, that will happen. It is not that people will see their motor insurance go down by £50 per year, but that they will not see it go up by £50 a year. My hon. Friend can go ahead and renew his motor insurance.

I believe that I am correct in saying that, if passed, the Bill will be the first Act of Parliament to remove retained EU law. It will certainly be the first to remove retained EU case law, so it will be a landmark step in taking back control of our own laws. It is just one of the clear advantages of leaving the European Union that we can now alter our laws to ensure that they are interpreted the way that this sovereign Parliament intends.

The Bill will be the first of many post-Brexit dividends to be established in primary legislation. We will deliver the independence that the British people voted for and put pounds back into their pockets. In fact, it would not be a bad idea for the Government to have a Brexit Minister whose sole responsibility it was to root out such savings across the whole of Whitehall—and for that person to be a Brexiteer who had consistently supported that point of view, maybe even a Spartan, and clearly not someone who is a member of the current Government. Does that give the Minister any clues?

The Vnuk judgment has also led the European Union to revise its European directive, because it was as surprised by the decision as we were, although, as with many decisions taken at EU level, the interest of the ordinary motorist has been sacrificed in the name of greater harmonisation between states. The revisions it has made will fail to protect motorists in the EU from the associated costs of the compulsory insurance requirement on private land. Because of Brexit, this Parliament has the opportunity to do better, and that is just what we are doing with the Bill.

I will briefly mention the case of Colley v Shuker, which is being considered by the Court of Appeal next week, as I know the implications of the Bill have been questioned in relation to it. It is clear, however, that the case bears no connection to the Bill that we are considering today, as it involves an accident where an insurance policy was in place. The effect of the Bill is only to restore the statute book to the position that everyone understood it to be before the Vnuk decision.

I mentioned earlier my gratitude to Committee members and I am thankful for their excellent contributions. In Committee, the right hon. Member for Warley raised an important point, which the hon. Member for Cardiff North made today, that the obligation that we have discussed arises in cases where there has been an accident and possibly an injury. It is certainly true that protecting genuine victims and general safety is of the utmost importance when considering insurance requirements but, in most cases, for accidents involving motor vehicles on private land, a different type of insurance policy will already be in place. In many cases, there is even an existing compulsory insurance requirement, such as public liability insurance, employers liability insurance or events insurance.

As previously stated, the Bill does not seek to create new law or to tie the hands of Parliament in making changes to the requirements for motor insurance in the future. What it does is restore the interpretations of the Road Traffic Act 1988, which stood for almost 30 years. In that time, copious case law in British courts shaped the interpretation of that Act and established through precedent recourse to the Motor Insurers’ Bureau in certain circumstances. To give the House an example, although my local Waitrose car park might technically be on private land, were I to have an accident with an uninsured driver, the Motor Insurers’ Bureau would have liability, as established through existing case law. It is impossible to anticipate every possible accident scenario, although the Road Traffic Act has historically proved very adaptable. If, out of the blue, an incident highlighted a deficiency in protection for injured parties, I have every confidence this Parliament would act to rectify that.

I would also like to address the concerns of my right hon. Friend the Member for East Yorkshire (Sir Greg Knight), who bowled the Minister quite the bouncer during the Committee. I must add my thanks to the Under-Secretary of State for Transport, my hon. Friend the Member for Aldridge-Brownhills (Wendy Morton), for stepping in at the very last minute to deal with the Bill in Committee, as the responsible Minister was unfortunately ill on that day.

My right hon. Friend the Member for East Yorkshire raised a concern about how electric scooters will fall under the Road Traffic Act. It is my understanding that electric scooters would be classified as motor vehicles under the Road Traffic Act and would therefore require compulsory insurance. However, electric scooters are not allowed to be used on the roads, so Parliament will have to clarify that situation. That is not relevant to this Bill, because all we are doing is restoring the law to what it was before the Vnuk judgment.

[Sir Greg Knight]

Will my hon. Friend give way?

[Mr Bone]

I feel another bouncer coming.

[Sir Greg Knight]

I am trying to be helpful, actually. Although it is, as my hon. Friend says, not a debate for today, does he agree that there is a good case that if electric scooters are allowed on the public highway, they should be insured?

[Mr Bone]

I think the law as it stands requires them to be compulsorily insured, even though they are not allowed on the road. That is a dilemma for the Government to sort out, but it is not, happily, for this debate.

I will move on to a second similar thing. I understand that there is a bespoke arrangement in place for electric bikes, whereby insurance is not compulsory. Although these bikes are used on public roads, they do not have to be compulsorily insured. It is also true that given how expensive the equipment is, many electric bike owners still opt to take out an insurance policy. It may be possible to look at expanding the arrangement to electric scooters, but again that will be a matter for Parliament to consider, and it is not relevant to what the Bill does. My right hon. Friend has brought it up, and it needs to be looked at by the Government.

Finally, clause 2(2) sets out the jurisdictions of the Bill. The provisions in the Bill extend and apply to England, Wales and Scotland only. The exclusion of Northern Ireland is consistent with the convention that Westminster will not normally legislate for matters that are within the legislative competency of any of the devolved Administrations. The Bill therefore does not legislate for Northern Ireland, as the matters to which the provisions of the Bill relate are within the legislative competency of the Northern Ireland Assembly. I understand, however, that the Northern Ireland Assembly is closely following the passage of this Bill, which will set an example that it might want to follow.

I am thrilled that leaving the European Union has given us this opportunity to deliver a clear Brexit dividend and to finally take back control of our laws. I hope this Bill will be the first of many over the course of this Government to deliver on our key post-Brexit objective.

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[Marco Longhi]

SORN—that is the word.

At a time when everyone is facing increasing household bills, fuel costs and cost of living, we should make it our priority to get rid of any unnecessary financial burdens. The Bill will reduce the cost of insurance for motorists across the UK. As has been said a couple of times already, implementing Vnuk across the UK would have cost something in the region of £2 billion, covering all existing motor cars, motorbikes, business vehicles, motorsports and other businesses.

[Sir Greg Knight]

I am a car owner too—I think most of us are—but is it not also important that without the Bill, the future of British motorsport could be seriously at risk?

[Marco Longhi]

I thank my right hon. Friend for his intervention and I completely agree with his observation.

It has been calculated that insurance policyholders could face an estimated cost of over £1 billion if Vnuk were implemented, expressed as a potential increase in individual insurance premiums of circa £50 for 25 million consumers. An extra £50 a month is a lot of money for many families; it could mean choosing between eating or heating their homes. Our constituents should keep that £50 in their own pockets, and not cover the costs of some idiots who may cause accidents and fail to insure their vehicles while they are at it. To me, the Bill smacks of pure common sense.

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[Anthony Browne]

We do. Clearly, people do drive from what is now the EU to the UK, but the volume of traffic is very low.

I want to raise a point about why we ended up with this European Court of Justice ruling. As a Europe editor of The Times, I wrote various think-tank reports about EU regulations and structure. I advised the Government and was involved with European law-making for about 20 years. In the Lisbon treaty, there is the principle of subsidiarity. We do not talk about it much in this place. When Margaret Thatcher was Prime Minister, she talked about it and everyone scratched their heads saying, “What is subsidiarity?” The basic principle is that one should make laws at a European level only where necessary, for example on cross-border issues such as pollution or trade. I cannot see any argument for why the insurance of golf buggies needs a pan-European law.

[Sir Greg Knight]

I join my hon. Friend in declaring an interest as the insurer of several vehicles. Is it not the other side-effects of Vnuk that are so offensive and why we are right to support the Bill? Without the Bill, would it not mean that, for example, ride-on lawnmowers would need to have insurance?

[Anthony Browne]

My right hon. Friend is absolutely right. That ECJ judgment has incredibly wide-ranging implications across many different sectors. I picked on golf buggies, but it affects lawnmowers, agricultural vehicles and electric scooters, as we heard. It is incredibly wide ranging. It is baffling and extraordinary how a Slovenian farmer, Mr Vnuk, getting knocked off his ladder—poor guy; I hope he was not too badly injured and I hope he got compensation—can lead to a series of different judgments, amendments and so on that cost the British motor insurance industry £458 million or a £50 increase in premiums for British drivers, a total of £1 billion a year. It is difficult to explain to voters, even in remain constituencies like mine, what the justification is for that.

Before my right hon. Friend’s intervention, I mentioned subsidiarity as a principle enshrined in an EU treaty. There are various mechanisms in the EU to try to ensure subsidiarity. Parliamentary committees of national Parliaments are meant to have votes and give red flag warnings when EU legislation contravenes it. However, this was not EU legislation. It was a judgment from the European Court of Justice and, as case law has the effect of legislation, it was enshrined in UK law after we left the EU. That raises the question of the European Court of Justice.

I reported on the European Court of Justice. I have visited its buildings many times. I will give one little anecdote about a story I once tried to do. The British Government were appointing a judge to the ECJ. I thought that that was quite an important story. The British Government were involved and the ECJ had, when we were in the EU, a constitutional role in the UK. It could make laws that overrode the national Parliament and the national Government, and could change the lives of British citizens. The Vnuk ruling is a clear example of that. At the same time that I was suggesting to the editor of The Times that I write a story about the British Government’s appointing a judge to the European Court of Justice, there was some controversy over a judge on the United States Supreme Court, as hon. Members may recall—one of them had a nanny they should not have employed, or something. I said, “This is a far more important story. The British Government are involved. This court changes the lives of British citizens. It can overrule the British Government and the British Parliament.”

I wrote my story, and the next day the Supreme Court wrangling was front page of The Times, the main story, and my story about our appointing a judge to the European Court of Justice was a “News in Brief”, a tiny little thing. This is not a pro-remain or pro-Brexit argument, but even when we were members of the EU we had virtually no knowledge or understanding of the workings of the European Court of Justice or its important or significance.

When we were members of the EU, I used to play a little parlour game: “We have the right to appoint a British judge to the European Court of Justice. What is the name of our judge on the European Court of Justice?” I used to ask MPs and so on, and no one had any idea. I searched for his name in newspaper articles and this particular judge was never mentioned—I cannot actually remember his name now. I will save their blushes, but I asked the serving Europe Minister at the time, “What is the name of our judge on the European Court of Justice?” and he had no idea. I thought, “We really do have a problem as a country. We have no understanding or appreciation of the importance of the court, the way it works or the influence it has over our daily lives in this country.”

The Vnuk judgment is not only a clear example of the role of that court, overriding the objections of the British Government and of Parliament, but a clear breach of the principle of subsidiarity, which is enshrined in EU treaty law. There will probably be other examples of retained EU legislation; my hon. Friend the Member for Wellingborough suggested that there will be a whole series of such bits of legislation that we think are inappropriate for the UK. He suggested a new Government position: a Brexit Minister, someone who has had an interest in this issue for the whole time and is not currently serving as a member of the Government. I wonder who he could be thinking about?

Without repeating that suggestion, let me make another one. I keep coming across different bits of legislation in this place that we can only enact as a result of our having left the EU. This Bill is one example, but there are many others. It would be useful for the Government to compile a list across all the different Departments of all the little things we are doing as a result of leaving the EU, as well as the big things such as reforming the common agricultural policy and so on.