Courts and Tribunals Fees

Ian Murray Excerpts

Monday 4th July 2016 Commons Chamber

[Robert Neill]

We do not go so far as to say that it follows that there should never be fees in any particular class of case—that includes employment tribunal fees—but we do say that a balance has to be borne in mind. I suppose that one could conceive of an argument—we did not rehearse it in detail in our report—whereby an enhanced fee might be recycled within the system. If, for example, some of the fees were being used to cross-subsidise, as it were, other elements of the family jurisdiction, then there might be something in that, but we do not have any evidence that that is the case. The hon. Lady makes a fair point, which is consistent with our report, about the undesirability of going down that route.

The situation provides a contrast with the speed with which the Government acted over both the criminal courts charge, quite rightly, and the new proposals for higher fees ever since the employment tribunal fees were introduced, with some controversy. The Department made those proposals with great speed, but it has been remarkably tardy in producing its review of the impact of those employment tribunal fees. That is why we conclude that, although a legitimate balance has to be found in the interests of society, where the objective of achieving cost recovery and the principle of preserving access to justice are in conflict, it is the latter—access to justice—that has to prevail. In a sense, that is a restatement of the point made by the late Lord Bingham of Cornhill, and I would have thought that most Members saw the logic of that.

Other members of the Select Committee will wish to make particular points, so I will touch on a few of the major matters. I have already referred to the quality of the evidence from the Ministry of Justice, particularly that in relation to employment tribunal fees. Ultimately, the Department may not have the evidence; if that is the case, it should say so, rather than pretend otherwise.

It is worth giving a flavour of some of the comments we received about the evidence base. The Master of the Rolls, Lord Dyson, described the Department’s research as “lamentable”. It is pretty serious when the head of civil justice in this country talks in those terms. The chairman of the Bar Council described the research undertaken in relation to the domestic effects of fees as “insignificant”, and the president of the Law Society said it was “poor”.

I appreciate that the Under-Secretary of State for Justice, my hon. Friend the Member for Esher and Walton has only just started the job—I do not blame him or any of his colleagues personally—but the truth is that the Government did not produce adequate evidence. On the face of it, it seems to have been a “wet your finger and hold it up in the wind” job, rather than being based on significant research. We do not think that that is satisfactory.

Perhaps things would have been different if the Government had brought forward their review. We might have been less critical if we had seen the evidence that they have collated but not yet made available. As it was, we had to base our conclusions on the evidence that we had, which I am afraid went significantly in another direction. It is ironic that, by not providing that material, the Government have not been the best of advocates of their own cause.

I am not going to say that everybody had difficulties with employment fees. In their evidence to us, the Federation of Small Businesses and Peninsula Business Services said that it was reasonable to have the objective of discouraging weak and vexatious claims. That was certainly the Government’s assertion when they introduced the fees, but hard material to support that view has not yet been forthcoming. We must bear in mind the comments of the senior president of tribunals, Sir Ernest Ryder, who said that it was simply too soon to say whether that has happened. If that is the case, and if the valuation is not yet available, now is not the time to be rushing similar increases in other parts of the civil and family and immigration jurisdictions, which I will turn to later. I will leave it to others to go into more detail about employment fees, as I know they will.

[Ian Murray (Edinburgh South) (Lab)]

I am grateful to the distinguished Chair of the Justice Committee for allowing me to intervene on him. If there is very little evidence to suggest that there were vexatious claims in the employment tribunal system and if the number of claims in some regions has dropped by a quantum of about 80%, is it not possible to make the opposite argument that fees are a block to justice and that, to get access to justice, they will have to be lowered? If this is about cost recovery, the number of employment tribunal cases is now so low that no costs are being recovered at all.

[Robert Neill]

That is why we made the point that we need to have a much better evidence base before we go forward with like increases in other areas. We did not rule out the fact that a fee may be appropriate in some cases, but we need better evidence to know the proper level to pitch it at and whether there are any unintended consequences—whether it will deter not just unworthy claims, but, as we fear, meritorious claims as well. A particular concern raised was that the employer and the employee claimant would get into a war of attrition, depending on who has the deepest pockets. That is not really consistent with the “equality of arms” argument that we have always regarded as being central to our justice system. Funnily enough, it may tend to make cases more protracted than they need to be, when the swiftest and earliest possible settlement would, as a general rule, be in everybody’s interests. I am grateful to the hon. Gentleman for his point. We were much assisted in our inquiry by evidence on the matter from the Law Society of Scotland, and we are grateful for its assistance.

Against that background, we made all due allowance for the fact that there has been some change in the substantive law, for the improving economic situation, for the previous downward trend in tribunal cases and for the ACAS conciliation schemes. Those things could account for some of the drop, but we were looking at a drop of about 70%, and we found no evidence to suggest that it was accounted for entirely or substantially by those matters, so we were led to the conclusion that the clear majority of the decline was attributable to the level of fee. That is why the matter needs to be looked at seriously and we need the factual information immediately.

We set out certain indicative thoughts about the sorts of changes that might be made; they are indicative because we do not have the evidence to go further than that. We think that this is an important issue, which really cannot be kept back for much longer.