Non-Contentious Probate (Fees) Order 2018

Lord Beecham Excerpts

Tuesday 18th December 2018 Lords Chamber

[Lord Beecham (Lab)]

My Lords, I begin by declaring an interest in the subject of this debate, albeit a posthumous one. Ultimately, I will not be affected by the proposed changes, although my daughter and son will be. I ought perhaps also to refer to my interest as an unpaid consultant to the firm of solicitors of which I was a senior partner in the light of the closing comments of the noble Lord, Lord Marks, about the professional aspect.

If ever there was a competition for the chronic misnaming of a piece of secondary legislation, the Non-Contentious Probate (Fees) Order 2018 would be a runaway winner. There is nothing non-contentious about it. As we have heard, the order, while exempting estates of £50,000 or less from the payment of fees, increases the cost for larger estates in a range from £250 for estates up to £300,000—or £150, as we heard, when an application is made by a solicitor—to £6,000 for estates above £2 million, generating a profit of £145 million a year over and above the £49 million fee income collected in fees for the service in 2016-17. That is effectively a fourfold increase.

Admittedly, this is somewhat less than the estimated £250 million which would have been garnered by the original proposals in 2017, as outlined in the government consultation document of 2016, and less again than the £300 million extra in additional fee income set out in their response to that consultation in February 2017. If there were a Nobel Prize for elasticity, the Ministry of Justice would, uncharacteristically, be a strong candidate.

The original proposals ignited a blaze of opposition among the general public, the media and both the Secondary Legislation Scrutiny Committee of your Lordships’ House and the Joint Committee on Statutory Instruments. The former declared:

“To charge a fee so far above the actual cost of the service arguably amounts to a ‘stealth tax’ and, therefore, a misuse of the fee-levying power”.


The latter averred that it had,

“a real doubt as to whether the Lord Chancellor may use a power to prescribe noncontentious probate fees for the purpose of funding services which executors do not seek to use—namely those provided by courts and tribunals dealing with litigation”,

a view strongly supported by the Law Society and the Bar Council, the latter pointing out that,

“the grant of probate … is not in reality a judicial or court act at all. It is a simple but authoritative piece of paper, bearing a stamp, produced by a civil servant on a relatively low pay grade in a relatively short period of time, the average cost of which is £166”.

That reads as a mild rebuke compared with the critique proffered by the Secondary Legislation Scrutiny Committee in its report of March 2017, shortly before the Prime Minister called the election which cost the Government their majority, and reiterated in its report of 21 November. The committee deals with the Government’s assertion that,

“it is necessary to fund the wider courts and tribunals system to ensure an efficient and effective service”,

and responds by citing the Government’s guidance to departments in Managing Public Money, a government document stating that,

“different groups of customers should not be charged different amounts for a service costing the same”.

It also cites Managing Public Money’s statement that:

“Cross-subsidies always involve a mixture of overcharging and undercharging … So cross-subsidised charges are normally classified as taxes”,


and concludes:

“To charge a fee so far above the actual cost of the service arguably amounts to a ‘stealth tax’ and, therefore, a misuse of the fee-levying power”,


under Section 180 of the Anti-social Behaviour, Crime and Policing Act 2014 and that the order represents,

“a significant move away from the principle that fees for a public service should recover the cost of providing it and no more”—

a damning judgment which I have included in the amendment in my name. This view is endorsed by the Institute for Family Business, referred to by the noble Lord, Lord Marks, an organisation which is not, to my knowledge, affiliated to the Labour Party—at least not yet.

There is certainly an important principle here. The Ministry of Justice is struggling with an overcrowded and underfunded Prison Service, an overstretched probation service, court closures and diminishing access to justice. Of course the justice system desperately needs better funding, but this should be provided not by a stealth tax but out of general taxation including, possibly, inheritance tax. If the Government go ahead with the provisions of this order, how can we rely on them not to adopt similar stealth taxes to fund other key services, for example by increasing prescription charges to a level exceeding the cost of the treatment supplied by the health service?

The Minister’s letter of 12 December asserted that the fees are being introduced under Section 92 of the Courts Act 2003 and Section 180 of the Anti-social Behaviour, Crime and Policing Act, both of which he has referred to this afternoon. He said that they,

“provide clear authority to set fees above cost to cross-subsidise other parts of the courts and tribunal system”.

Section 92 refers explicitly to anything dealt with in the family court, county court or magistrates’ court. No mention is made of probate. Section 180 of the other Act refers to senior courts, county courts, magistrates’ courts, the Court of Protection and tribunals. Again, no mention is made of probate. The noble and learned Lord has argued the case for a deeply flawed order today.

However, while I can well understand the temptation to seek to annul this order, there is a real problem for this House in so doing. I understand that there have been only four occasions in the last 60 years on which the affirmative procedure has led to an order being struck down in your Lordships’ House. One such occasion, which some noble Lords will recall, was in relation to an order under the Legal Aid, Sentencing and Punishment of Offenders Act—then a Bill—in 2012. My noble friend Lord Bach successfully moved such an amendment and was roundly denounced by the relevant Minister, the noble Lord, Lord McNally, who was then a Justice Minister and leader of the Liberal Democrats. That amendment was not a simple repudiation of the order. It was tabled because the Government had reneged on a promise to amend the proposed provision they were bringing forward and was to give them the opportunity to revert to their earlier position.

Regretfully, we cannot support the amendment in the name of the noble Lord, Lord Marks, but if he presses it to a vote we will abstain. In that event, and assuming that the amendment is then lost, I will seek to test the opinion of the House on the amendment in my name.

[Baroness Meacher (CB)]

My Lords, I speak in support of the amendment in the name of the noble Lord, Lord Marks, to the statutory instrument on so-called non-contentious probate fees. As a member of the Joint Committee on Statutory Instruments, I am very concerned that—as other noble Lords have said—the SI appears to be introducing a hypothecated tax on estates for use in subsidising parts of the HM Courts & Tribunals Service that will not at all be used by the fee payer. The SI introduces a huge increase in the cost of probate, which is just a document to enable the executors to administer the estate. It is nothing to do with courts and tribunals, which obviously involve vast costs.

The current fee of £155 if the application is made by a solicitor, and £215 if it is made by the executors in person, completely covers the cost of the probate service. Until now the fee has rightly not included any tax element at all, so this is a major departure from the way probate fees have been exercised in the past. Will the Minister explain why we suddenly need an entirely new approach to probate fees? Has it something to do with the massive cuts in the Treasury’s support for the courts service? I presume it is, but I do not think that makes the action of the justice department acceptable.

As other noble Lords have said, the proposed new fees are going to be on a sliding scale, up to £6,000 for estates of £2 million. This is a hike of 3,770% on larger estates. All but about £200 of the fee will in fact be a tax.

The committee accepts that Section 180 of the Anti-social Behaviour, Crime and Policing Act 2014 allows a fee to be prescribed that exceeds the cost of the provision of the service. I imagine that this probably allows for, for example, exempting very small estates from the fee at all, so then you need to have a slightly higher fee on bigger estates. That is perfectly reasonable. But the term “fee” has a clear connotation of recovery of costs incurred in the provision of the service. Although Section 180 permits enhanced fees, it remains a power to prescribe a fee, which clearly limits it to a relationship with the costs incurred.

The word “fee” does not equate to the term “tax”. A fee surely cannot comprise £200 to cover costs and £5,800 to the individual as a tax on the estate. If Parliament had intended the Lord Chancellor to be able to raise taxes in this way, it would have included such provisions very clearly in Section 180 to acknowledge that charging such a tax might be ultra vires. In the committee’s view, the 2018 order is a measure of taxation for which there is no clear statutory basis. Indeed, the committee could find no evidence that the Government suggested to Parliament during the debates on the Bill for the 2014 Act that the Section 180 powers would be used to prescribe probate fees in order to fund the operation of the courts generally or to provide for such huge and immediate increases in fees—let us call them “taxes”—in the way now proposed.

Furthermore, our committee’s view was reinforced by the report of the House of Lords Secondary Legislation Scrutiny Committee, as the noble Lord, Lord Beecham, mentioned. This points out that the proposed fees do not appear to conform to paragraph 3.6 in chapter 6 of Managing Public Money, the standard guidance to government departments from HM Treasury. Of course, that guidance makes it very clear that a fee should be equal for everyone involved and should represent the cost of the service. There should not be a sliding scale of a fee: that is made very clear in the Government’s own guidance.

As others have mentioned, the original proposal was to have a sliding scale up to £20,000. That was dropped as a result of the objections of the Joint Committee on Statutory Instruments. Can the Government can explain why, when they now accept that £20,000 is unreasonable, they think that £6,000 is somehow reasonable in this context? I suggest that the importance of this issue is that it could represent a precedent for other government departments. Just imagine the implications for citizens if government departments increased fees by some 3,000% for a wide range of services in order to incorporate a tax element to fund public services more generally. This would of course be ultra vires, as they are meant to be fees, as they are in this case. I hope that the Minister will give an assurance to the House today that the department will revisit the proposed probate fees and reduce them to bring them within the permitted limit.

--- Later in debate ---

[Lord Keen of Elie]

My Lords, I am obliged to all parts of the House for contributions to the debate on this order. The noble Lord, Lord Pannick, correctly identified that there are two issues. One is whether the proposal is constitutional or unconstitutional. The second concerns fairness. Of course, at times the two arguments have merged. I will endeavour, however, to address each in turn.

On the question of whether the instrument is intra vires or not, I have to say that it is quite clear that statutory justification for it is given by Section 180 of the 2014 Act. The noble and learned Lord, Lord Judge, may, for reasons he has expressed in the past, deprecate the extent to which Parliament has given powers to the Executive in this regard: I think that in this instance it is entirely proper. Nevertheless, the power is there. On the point raised by the noble Baroness, Lady Hamwee, with reference to Section 180(3)(a) and (b), subsection (b) was referred to in the impact assessment, where it was determined that there was no identifiable or significant impact upon competitiveness in this context—which is hardly surprising in the circumstances.

The noble Baroness, Lady Meacher, suggested in the context of the vires of the instrument that it was necessary that the fee should be equal for all involved, otherwise it would be a tax. With great respect, at present there is no fee for estates worth less than £5,000: the current system is not equal in that respect. It is certainly my recollection that the probate fee was progressive until about 1999. The fixed fee came in only in the recent past, less than 20 years ago. Again, one has to see this in context. Let me be clear: the idea of progressive fees is not exceptional or unusual. A civil money claim for £1,000 may often be far more complex and demanding than a civil money claim for £100,000, but the fee in respect of civil money claims is progressive by reference to the sum to be recovered. These elements already exist in our system.

With this instrument, we are intending to remove more than half of all estates from any probate fee whatever, yet the logic of the noble Baroness, Lady Meacher, would be that we cannot do that because if we did the fee would not be equal for all involved. It is entirely appropriate that there should be a progressive fee system, just as there has been in the past and just as there is with other elements of judicial and related claims. In that context, an application for probate is an application for, in essence, a determination of status in order that somebody can ingather an estate and distribute it, so it is in a sense a judicial process, albeit, as it has developed over the years, it is seen as an administrative application.

There is clear statutory authority for the making of this order and the introduction of these sensible and proportionate fees in this context. The provision is there; I will not seek to repeat it. On the issue of fairness, I emphasise that more than half of all estates will be taken out of any fee whatever, the maximum fee will be £2,500, and the fee can never exceed 0.5% of the value of the estate.

The noble Lord, Lord Sharkey, raised some of the observations that have been made with respect to charities. Let us be clear: if a legacy is left to a charity and it is of a fixed sum, it will not be impacted at all by the provision. It would arise only in those—perhaps exceptional—circumstances where the entire estate is left to the charity. One has to appreciate that it is only in those exceptional circumstances that there could be any indirect—I emphasise that—effect on the value of the legacy itself.

At the end of the day, we are taking a proportionate and sensible approach to the need to ensure that we can maintain access to justice throughout our entire courts and tribunals system. We have been fair with regard to the level of the fees which have now been fixed for this purpose. I emphasise that we are dealing with a question of fees, not with the issue of a tax. In that regard, therefore, I invite noble Lords to concur with my Motion.

[Lord Beecham]

How does the Minister reconcile the position the Government have taken with the guidance to departments in Managing Public Money, to which I referred?

[Lord Keen of Elie]

There is clear statutory authority for the fixing of these fees in order that there can be an element of cross-subsidy between the various elements of the courts and tribunals system. It is justified by that statutory permission.

--- Later in debate ---

Moved by

[Lord Beecham]

At the end insert “but this House regrets that the draft Order will introduce a revised non-contentious probate fee structure considered by the Secondary Legislation Scrutiny Committee to be “so far above the actual cost of the service [it] arguably amounts to a stealth tax and, therefore, a misuse of the fee-levying power” under section 180 of the Anti-social Behaviour, Crime and Policing Act 2014; and that this Order represents a significant move away from the principle that fees for a public service should recover the cost of providing it and no more.”

[Lord Beecham]

My Lords, I beg leave to test the opinion of the House on the amendment in my name.

Brexit: Attorney-General’s Advice

Lord Beecham Excerpts

Thursday 29th November 2018 Lords Chamber

[Lord Keen of Elie]

There has been a resolution in the House of Commons. We are aware of its terms and its scope. We will await the Statement from the Attorney-General to see to what extent it is considered by the House of Commons to meet the resolution that was made.

[Lord Beecham (Lab)]

My Lords, as I understand the noble and learned Lord, the Attorney-General’s report, whatever form it takes, will be published only the day before the debate. Why is it being left to that late date?

Civil Liability Bill [HL]

Lord Beecham Excerpts

Ping Pong (Hansard): House of Lords
Tuesday 20th November 2018 Lords Chamber

[Lord Judge (CB)]

My Lords, in view of everything that has been said about the Minister, perhaps he does not need any help from me in addressing the concerns expressed by the noble Lord, Lord Hodgson, but I will offer him some comfort. Many people will want to make a contribution to the discussion with which the noble Lord, Lord Hodgson, has been concerned. They may not all have the same interest as the judiciary has in seeing that there is a fair balance between the way in which the whiplash injuries damages are to be assessed and the way that all other injuries are assessed—the process of assessing damages as it develops over the years.

I specifically asked that we should not have the concurrence of the Lord Chief Justice. We simply asked that he should be consulted. When he is consulted, like everyone else who has been consulted, he will be someone making a contribution to the final decision of the Lord Chancellor. As he will be merely consulted and not asked to concur, there is no danger that my successor many years down the line will find himself at the wrong end of a claim.

[Lord Beecham (Lab)]

My Lords, I refer to my interest as an unpaid consultant with my old firm. I begin somewhat unusually by congratulating the Minister on having improved a pretty flawed Bill since it left us. I assume that he has played a significant part in that. In particular, I strongly endorse the provisions of Amendment 1, which are an improvement on the original wording. However, we would still have preferred the retention of the existing system which allows judicial discretion on the level of compensation to be awarded based on judicial guidelines. To answer the noble Lord, Lord Hodgson, that is how the system operates and there seems to be no good reason why the assessment of damages for this kind of injury should be different in those terms from any other form of injury.

Of course, we also continue to be opposed to the increase in the small claims limit by an amount higher than inflation, in accordance with the review carried out by Lord Justice Jackson several years ago of civil litigation costs. In fact, the increase is something like 100%, although I take the noble and learned Lord’s point that that is not strictly within the scope of this Bill.

The Justice Select Committee warned that,

“increasing the small claims limit for PI creates significant access to justice concerns”.

The Government’s plans to increase the small claims limit will mean that more cases are allocated to the small claims track. That will leave tens of thousands of working people priced out of getting proper legal representation. These measures are a further gift to insurance companies which are already experiencing increased profits at the expense of people injured through no fault of their own.

What assessment have the Government made of the impact of the changes to the operation of the courts, given that increasingly claimants will be unrepresented? Within the last fortnight, the Permanent Secretary at the Ministry of Justice has told the Justice Select Committee that two of the main spending assumptions were fundamentally “unrealistic” and that even the Treasury recognised that the department was under “considerable strain”. In these circumstances, how confident is the Minister about the ability of the courts to deal with an increase in unrepresented claimants from 5% to 30%, as predicted in the whiplash impact assessment? That of course relates only to that particular area; there will be another shortfall in relation to other claims. How long do they anticipate will be the “long term” envisaged before the courts operate at cost recovery level, as suggested in the whiplash impact assessment? To be clear, whiplash impact for this purpose is on the system, not on the unfortunate claimant.

It is estimated that insurers will gain £1.3 billion a year. I hope that the noble and learned Lord’s confidence that the industry will ensure that those savings are passed on to policyholders will be proved correct. Why will it be six years before the Treasury reports to Parliament on the savings accrued to policyholders, as apparently will be the case? It seems an inordinately long time to assess the impact of this provision. Further, is it not ironic that the Government, who make so much of the need to protect policyholders from the impact of exaggerated or fraudulent claims, have themselves increased insurance premium tax four times in eight years, thereby currently collecting £2.6 billion a year more from the people they purport to be helping through this Bill?

While the commitment given at Third Reading in the Commons that vulnerable road users will be exempt from the changes is welcome, why are children and people injured at work not included in the exemption? Extending the change to those two groups would seem to be a reasonable move.

By sheer coincidence, today sees the publication of the report of the Constitution Committee. It is highly critical of the Government’s increasing reliance on secondary legislation. The committee supported the views of the Delegated Powers and Regulatory Reform Committee earlier this year that key measures should be included in the Bill and not left to secondary legislation. Also, most tellingly, it said that judges, not the Lord Chancellor, should set the new tariff and that the Lord Chancellor should not be granting powers to make provision for damages relating to minor psychological injury. This accords with amendments debated during the passage of the Bill through this House but not enacted.

I hope that a review of this measure will provide an opportunity to return to this issue and adopt that approach in due course. I repeat that the Bill comes back to us in better condition than it was, but I remain convinced that it is not in as good condition as it should be.

[Lord Keen of Elie]

I am obliged to the noble Lord, Lord Beecham, for acknowledging that we have at least achieved a curate’s egg, if nothing more.

The Bill makes important changes to our personal injury compensation system; it makes that system fairer, more certain and more sustainable in future for claimants, defendants, motorists and the taxpayer. That builds on our wider reforms to cut the cost of civil justice claims and strengthen the regulation of claims management companies, which play such a big part in this. The first part of the Bill will deliver a key manifesto pledge. It will support the consumer by bringing down the cost of living through a crackdown on exaggerated and fraudulent whiplash claims that lead to higher insurance costs. The second part of the Bill will provide a fairer method for setting the personal injury discount rate and reviewing it so that it does not remain at one level, as it did for 16 years.

I am grateful for noble Lords’ observations and careful scrutiny of the Bill. I want to touch on one or two of their points. The noble Lord, Lord Sharkey, commented on the complexity of the approach taken on Clause 11. That approach was carefully crafted after consultation with interested parties, including the FCA, to ensure that it is as effective as possible. At the end of the day, the Government’s approach has been determined by the need for a rigorous and proportionate regime for insurers as far as savings are concerned. We have to remember that the FCA is an independent body. Clearly, we cannot confirm exact FCA action in respect of these matters but we assure the House that it will take very seriously any case where an insurer does not treat customers fairly. That could include a public commitment not being met if that formed part of a policyholder’s or consumer’s expectations.

The Government have taken a careful and considered approach to what is sometimes termed “naming and shaming”, particularly with regard to the provisions in Article 6 of the European Convention on Human Rights. There are circumstances in which the FCA may decide publicly to censure a firm, but that would typically follow a detailed investigation. The idea of somehow naming and shaming a firm before such an investigation could raise questions about convention rights under Article 6. I suggest that we have taken a considered approach to this but, ultimately, those outliers—if I can call them that—who might seek to abuse the system will be open to censure, potentially publicly, by the FCA in due course.

In the context of the point made by the noble Lord, Lord Hodgson, I readily adopt the observations of the noble and learned Lord, Lord Judge. At the end of the day, consultation with the Lord Chief Justice will allow the judiciary some input into, or comment on, the setting of the tariff of damages against the background of its knowledge of the general level of damages awarded for personal injury in diverse cases. One would hope that this would ensure no material divergence in levels of damages as far as that is concerned.

The noble Lord, Lord Monks, raised a number of questions. Regarding Amendment 1, the primary legislation approach to setting the tariff is not considered appropriate because it should be amenable to review and flexibility. Setting it in stone would not allow for that. Regarding the question of employers’ liability and employers’ liability clauses, we consider that the courts are equipped to cope with such claims. On cost recovery, referred to in the impact assessment at paragraph 5.66, I note that the aim is ultimately to try to achieve cost neutrality so far as the court process is concerned, but I acknowledge that that is a long-term aim.

Third Parties (Rights Against Insurers) Act 2010 (Consequential Amendment of Companies Act 2006) Regulations 2018

Lord Beecham Excerpts

Wednesday 17th October 2018 Grand Committee

[The Advocate-General for Scotland (Lord Keen of Elie) (Con)]

My Lords, the Third Parties (Rights Against Insurers) Act 2010 (Consequential Amendment of Companies Act 2006) Regulations 2018 will make amendments to the Companies Act 2006. The amendments are consequential to the changes in the law introduced by the Third Parties (Rights Against Insurers) Act 2010. They are necessary because of the effect of the interaction of the Third Parties (Rights Against Insurers) Act 2010, the Third Parties (Rights against Insurers) Regulations 2016, and the Companies Act 2006 on the ability of insurers to exercise their rights of recourse against other parties liable for the same loss.

I will make clear that the draft regulations are concerned only with the ability of one insurer to obtain money from someone else, typically another insurer, where the first insurer has already paid out an award of damages. They do not affect the rights of personal injury claimants.

The Third Parties (Rights against Insurers) Act 2010 simplified and modernised the previous law and procedure by which victims could obtain compensation for wrongs done to them by insolvent wrongdoers. Most importantly, the 2010 Act allowed claimants to take legal proceedings directly against the insurer of the insolvent wrongdoer, rather than having to establish the wrongdoer’s liability in separate legal proceedings.

Wrongdoers which are dissolved companies were brought within the scope of the 2010 Act by the addition in the Third Parties (Rights against Insurers) Regulations 2016 of new Section 6A. This also meant that claimants no longer had to spend time and money restoring the company to the register of companies simply for the purpose of suing it, establishing its liability and thereby gaining access to its insurer.

The creation of this direct remedy against the insurer affects the insurer’s rights of subrogation in respect of their ability to recover payments of contribution from other wrongdoers and their insurers potentially liable for the same loss. Subrogation is a common law concept allowing a person who pays out a claim to “stand in the shoes” of the payee as regards other rights of action the payee had in relation to the claim. An insurer who pays damages to the claimant is therefore subrogated to the rights of the insured in relation to the claim.

Importantly in this context, as a result of the 2010 Act claimants no longer have to restore companies to the register. As a result, the current six-year time limit imposed on the restoration of dissolved companies, other than in relation to personal injury claims, will bite on insurers who are directly sued under the 2010 Act. This is because a claim for subrogation is not a personal injury claim.

The effect is particularly acute in personal injury claims for exposure to asbestos, where Section 3 of the Compensation Act 2006 makes any defendant liable for the whole of the loss to the claimant, irrespective of whether others might also have caused the injury and might also have an obligation of contribution.

Damages in these and other personal injury cases are usually paid by the defendant’s insurer. As a result of the payment the insurer is subrogated to the rights of the defendant against other parties liable for the same loss. However, a right to subrogation can be exercised only if the company to be sued exists. A dissolved company clearly does not, and a company that has been dissolved for more than six years cannot currently be restored to existence.

The changes to the law introduced by the 2010 Act, which removed the need for a claimant to restore a company, have therefore had the indirect consequence in personal injury cases that the insurer has to restore the dissolved company to be able to exercise rights of subrogation, but cannot do so if the six-year limit has been exceeded. A right to be subrogated to a claim for contribution against such a company has therefore been made inoperable, with the consequence that one insurer will have to bear the whole loss. This was not the intention of the 2010 Act.

The draft regulations cure this problem by allowing an application to restore a company under Section 1030(1) of the Companies Act 2006 outside the six-year time limit for the purpose of an insurer bringing proceedings against a third party, typically another insurer, in the name of that company in respect of that company’s liability for damages for personal injury. This change ensures that the same subrogation result is produced for direct claims against insurers under the new Section 6A of the 2010 Act as is already produced for indirect claims where the person who suffered the loss claims against the insured wrongdoer and the insurer pays for the loss. In other words, this solution restores insurers’ rights of subrogation without prejudicing any third party. We submit that it is a fair and sensible way to resolve the problem inadvertently caused by the 2016 regulations. I beg to move.

[Lord Beecham (Lab)]

My Lords, try as I might, I can find absolutely nothing wrong with the regulations. I have tried very hard to do so and failed completely. It is perhaps worth noting that it is unfortunate that this problem arose in the first place; presumably the original drafting ought to have anticipated and dealt with it. However, it is being corrected, although somewhat belatedly. What are the consequences, if any, for cases that have already gone through the process? It is presumably too late to apply the present terms to cases that have already concluded. Will there be litigation to go back over cases that have already been determined?

Victims Strategy

Lord Beecham Excerpts

Monday 10th September 2018 Lords Chamber

[Lord Beecham (Lab)]

My Lords, I thank the Minister for repeating the Statement. I join him in congratulating the noble Baroness, Lady Newlove, who is not in her place today, on her role in representing victims. I am sure all noble Lords will recognise the great contribution that she has made over the last few years.

Welcome though the publication of a victims strategy is, as my honourable friend Gloria De Piero pointed out in the House of Commons, it comes three years after being promised and in the shape of secondary legislation rather than the primary legislation envisaged. Even now, as we have heard, further consultation is to take place—for example, in relation to the victims’ code and the creation of the post of independent public advocate. Could the Minister indicate the nature of such consultation and its potential timescale?

Will the Government review the position in relation to judicial review where the cuts to legal aid over the last few years have in some cases prevented the pursuit of justice? The Statement is made on the same day that the Metropolitan Police have revealed a drop in the investigation of serious crimes, including sexual offences and violence. How is this supposed to help the victims of such brutality?

We are all aware of the enormous strain on police forces up and down the country, not least in London. There is no indication of additional funding to meet the challenges in the rise of serious crime, including violent crime and sexual offences. Indeed, the Police Superintendents’ Association is warning of a “perpetual state of crisis”. Surely this is unacceptable.

We welcome the promise to revise the victims’ code. How will that exercise be carried out, and what is the timescale envisaged? We also welcome the proposed changes to the criminal injuries compensation scheme. Again, could the Minister indicate the process and timescale for that exercise? We also support the idea of an independent public advocate in major disaster cases. The experience of these over the years has been, to put it mildly, very unsatisfactory for the many people involved in some of those disasters.

What is the estimated cost of the changes, and where will it be paid from? Will the Minister confirm that it will not be financed by cuts in other areas of the justice system? I remind the Minister that the female offender strategy, for example, was underfunded by £15 million. Will the Government look again at their funding of that important initiative?

The Minister described for the first time a cross-government victim strategy. To what extent will other departments be involved? I presume that the Ministry of Housing, Communities and Local Government, the Department for Education, the Department of Health and Social Care and, of course, the Home Office will all have a role. Will the custodial and probation services be involved in the approach to the new environment being created for the victims of crime? In dealing with offenders they will, I hope, be promoting the need for offenders to avoid such conduct in future, particularly where they have been involved in offences of this kind.

The proposals in the Statement are welcome as far as they go but will come to little without adequate funding and adequate engagement with all interested parties. I look forward to seeing how the proposals develop in practice, particularly in terms of adequate funding across the piece envisaged by the Statement. We look forward to that and I hope that the department succeeds in persuading the Treasury that investing in the ideas in the Statement and presumably to be debated across the justice system will be adequately met. Without that, any hope of change will be lost in practice.

Courts and Tribunals (Judiciary and Functions of Staff) Bill [HL]

Lord Beecham Excerpts

Committee: 1st sitting (Hansard): House of Lords
Tuesday 10th July 2018 Lords Chamber

[Lord Pannick (CB)]

My Lords, I pay tribute to the noble Lord, Lord Marks, for managing to table an amendment to this anodyne Bill that raises an issue of real significance. I say simply that it is a remarkable achievement for the Government to bring forward a Bill on courts and tribunals that ignores all the serious problems facing our justice system, not simply diversity but the recruitment crisis, the crisis in legal aid, the appalling state of the judicial estate and the vital need for modernisation.

[Lord Beecham (Lab)]

My Lords, I concur with the remarks of the noble Lords, Lord Pannick and Lord Marks. I remind the House that I have a parental interest in these matters in that my daughter is a barrister and sits as a part-time district judge. We support the amendment, particularly because of the concern about both gender and ethnic representation in the judicial system, which is currently well below what should be expected.

I have only one reservation about the amendment, which is that it calls for a report to be laid within a year of the Act passing. That does not seem to be a reasonably long enough period in which to judge the extent to which progress is being made. I would have thought that if the Government were disposed to accept the principle here, and I hope they would be, a more realistic period of two to three years would be one in which we would be able to genuinely measure whether there was an impact that all of us around the House would wish to see. Subject to that, we certainly support the principles of the amendment and I hope the Government will look at it sympathetically.

[Baroness Vere of Norbiton (Con)]

My Lords, this amendment would require the Secretary of State to assess and report on the impact on judicial diversity of the measures before noble Lords today.

The judiciary already has wide powers to deploy judges between jurisdictions in our courts and tribunals. The judicial deployment measures in the Bill are intended to amend existing legislation in specific areas to enhance these powers to ensure that judges continue to be deployed where needed and appropriate. Being able to make the best use of judges’ time and expertise to react to changes in case loads of different jurisdictions has benefits for all court and tribunal users.

The measures are targeted to specified judicial roles and are intended to fill gaps in existing deployment measures. They are therefore limited in scope. As the measures are about how our existing judiciary may be deployed, they do not impact directly on new appointments to the judiciary.

Implementing these measures will largely follow existing processes by which the senior judiciary authorise judges to sit in additional courts or tribunals. In the interests of fairness and transparency, where it is appropriate in accordance with the circumstances of each case, deployment decisions will be taken following an expression of interest exercise across the eligible pool of judges.

Increases in flexible deployment may enable individuals to gain valuable experience in sitting in other jurisdictions. For example, the measure which provides for the 14 senior employment judges also to be judges of the unified tribunals may enable them to demonstrate their competencies across a broader range of case types. This may in future result in more diverse appointments to higher courts and tribunals.

I am sure that all Members of your Lordships’ House would agree with many or most of the remarks of the noble Lord, Lord Marks. I, too, have a long-standing interest in this area. However, I was struck by the assumption he sometimes seems to hold that only women have caring responsibilities. I hope he will agree that men should care, too.

I am happy to place on record this Government’s commitment to working with the judiciary and the Judicial Appointments Commission to increase judicial diversity. We have seen gradual improvements in gender and ethnic diversity since 2014, but we know that there is more to do to improve judicial diversity at all levels. For example, the representation of men and women from BAME communities has increased from 6% to 7% in the courts and from 9% to 10% in tribunals, and the first BAME judge was appointed to the Court of Appeal in 2017. The judiciary publishes annual judicial diversity statistics, and this year’s publication will take place on Thursday.

It is important for the quality, independence and impartiality of our judges that we always appoint the most talented candidates on merit. We know that there are many talented potential candidates from a diverse range of backgrounds and we want to encourage and support even more of them to apply for judicial office. That is why the Ministry of Justice strongly supports the work of the Judicial Diversity Forum and works as part of the forum alongside legal professional bodies, judicial representatives and the Judicial Appointments Commission to co-ordinate action to increase judicial diversity.

In April we announced funding for a pre-application judicial education programme, PAJE, which will provide information and support to those considering a judicial role, and will be targeted in particular at those from underrepresented groups. This is very much a partnership project, and the Ministry of Justice is working closely with the Judicial College, members of the judiciary, the Bar Council, the Law Society and the Chartered Institute of Legal Executives to finalise the programme content. We anticipate that the first candidates will be able to participate in PAJE in early 2019.

There are several other initiatives and support schemes for potential candidates from diverse groups that are run by the Judicial Office and the legal professions, and supported by the Judicial Appointments Commission. These include outreach events, judicial-run workshops and mentoring schemes.

The Lord Chancellor is personally committed to working with the Lord Chief Justice and the chair of the Judicial Appointments Commission to consider all practical actions that would impact positively on diversity, assess the impact of our existing activities and measure progress. The Lord Chancellor appears regularly before the Justice Select Committee and the Lords Constitution Committee on matters relating to the judiciary, including diversity. We think that this is the appropriate and proportionate way of advising noble Lords on actions that we are taking to improve judicial diversity.

I hope that what I have said has reassured the noble Lord of our commitment to improving judicial diversity—

Law Commission: Funding

Lord Beecham Excerpts

Tuesday 10th July 2018 Lords Chamber

Asked by

[Lord Beecham]

To ask Her Majesty’s Government what assessment they have made of comments made by the Chair of the Law Commission that reductions in the Commission’s funding could put its independence at risk.

[The Advocate-General for Scotland (Lord Keen of Elie) (Con)]

My Lords, the Law Commission’s independent status is protected in law. Following reductions in its core budget, the commission has undertaken more funded projects. It is for the Law Commission to decide which projects it recommends are taken forward.

[Lord Beecham (Lab)]

My Lords, the commission’s website proclaims that it is a statutory body that aims,

“to ensure that the law is as fair, modern … and as cost-effective as possible … to conduct research and consultations … to codify the law, eliminate anomalies, repeal obsolete and unnecessary enactments and reduce the number of separate statutes”.

The commission’s budget has been cut by 54%—£2.1 million—since 2010, resulting in projects being delayed and, even more worryingly, in the words of the current chair, Sir David Bean, “elbowed aside” in favour of projects commissioned by the Government. Will the Minister confirm the commission’s independence and its right to select projects without being obliged to prioritise unduly work commissioned by the Government?

[Lord Keen of Elie]

My Lords, I have already sought to underline the commission’s independence with regard to these matters. The Government continue to value the important work of the Law Commission and recognise that it must retain the ability to make independent choices about reform projects that it chooses to take forward. There are, of course, circumstances in which departments of government will, as it were, seek to instruct or seek approval for particular projects to assist with the Law Commission’s budget. At this point, I pay tribute not only to the work of the Law Commission but to its outgoing chair, Sir David Bean.

Privately Financed Prisons

Lord Beecham Excerpts

Wednesday 27th June 2018 Lords Chamber

[Lord Beecham (Lab)]

My Lords, of course I will follow the noble Baroness’s advice—up to a point. We have one of the highest incarceration rates in Europe, exceeded only by those in some of the less advanced countries in the east of Europe. Yesterday, the Prisons Minister, Rory Stewart, said that prison numbers would rise from the current 83,000 to 93,000—the figure inadvertently quoted by the Minister—by 2022. The state of our prisons is a national disgrace as the Government struggle to recruit and retain staff, yet the Minister in the other place feebly states that he would like the prison population to go down but that it is not very likely to happen because he is not sure that there is a will among the people or Parliament to take measures to reduce the population. Given this craven approach to a critically serious problem, should not that Minister resign?

[Lord Keen of Elie]

My Lords, there is nothing craven about the approach that has been taken to the very real and challenging issues relating to our prison population. We are concerned that we should look more carefully at alternative forms of sentence, such as community orders, that would in themselves replace the requirement for sentences particularly of less than 12 months’ imprisonment. That is a matter for consideration. In addition, I remind the noble Lord that we are in the course of taking active steps to provide not only additional but new and refurbished prison accommodation in order to improve the standard of our prisons across England and Wales.

Civil Liability Bill [HL]

Lord Beecham Excerpts

3rd reading (Hansard): House of Lords
Wednesday 27th June 2018 Lords Chamber

[Lord Faulks (Con)]

My Lords, either there is a realistic power to vary the rate—I can see that there are some arguments in favour of that, which found favour with Mr Sumption, as he then was, when sitting in Guernsey—or it does not have any real meaning, as is the case following the decisions of the Court of Appeal. Although flexibility is desirable, if it is meaningless and if we as a legislative body decide that we are not going to overrule any decisions of the Court of Appeal, the noble and learned Lord, Lord Hope, is absolutely right about being accurate in the way that we legislate.

[Lord Beecham (Lab)]

My Lords, I hesitate to take either side of this argument, given the wisdom and experience of both noble and learned Lords, who have given conflicting views. I am therefore perfectly content, for once, to allow the Minister to indicate the Government’s attitude. After all, this Bill is not ending here; it is going to another place and there will be time for people with greater acumen than mine to look into the arguments advanced by the noble and learned Lord. It will be interesting to see what the Minister makes of them, but, of course, it is not the end of the day and perhaps this elevated discussion can take place with a more useful result than we are likely to see today.

[The Advocate-General for Scotland (Lord Keen of Elie) (Con)]

My Lords, I am most obliged to the noble Lord, Lord Beecham, for his positive contribution to the debate, to all noble Lords and noble and learned Lords for their observations on this amendment, and to the noble and learned Lord for moving it.

From the very outset—I go back to the Law Commission’s 1994 report on structured settlements—it was intended that a provision of this kind to depart from a prescribed rate should be very much the exception rather than the rule. Clearly, it recognised that it would be both expensive and time-consuming if the prescribed discount rate could regularly be the subject of challenge on the basis that there might be another more appropriate rate for any number of reasons. That goes some considerable way to explaining the position of the Court of Appeal in the case of Warriner v Warriner.

As the noble and learned Lord, Lord Hope, observed, I referred to a guillotine, but I qualified it with the words “almost complete”—this is a deficient guillotine; it is not a complete guillotine. I said that because, for example, the decision of the Inner House of the Court of Session, the appeal court in Scotland, in Tortolano v Ogilvie Construction, indicated that there may be cases in which the power to depart from the prescribed rate can be applied—but I accept that they will be wholly exceptional. In Tortolano, the court suggested that there might, for example, be a need to take account of a claimant who had to pay tax in a foreign jurisdiction, and that impacted upon the valuation of the award.

These are wholly exceptional circumstances, but the provision in Section 1(2) of the Damages Act 1996, which would be preserved by the words in subsection (2) of the proposed new Section A1, would allow for those wholly exceptional circumstances where the judiciary would be entitled to exercise an inherent discretion in order to achieve justice between the parties. It is in these circumstances that I would resist the amendment; I recognise that there may be room for taking this further, although I have been unable to identify it so far, to ensure that we can perhaps more clearly identify circumstances in which the exception would be applicable.

As the noble Lord, Lord Beecham, indicated, the Bill will be considered in the other place, and I and my officials would be content to explore further with the noble and learned Lord, Lord Hope, if he wishes to do so, whether the provision might be improved in some way. However, I have difficulty with that because I am concerned that if we intrude too much into this quite exceptional discretion, there is a risk of encouraging unnecessary and expensive litigation over the appropriate rate in individual cases.

On that basis, and recognising the point that the noble and learned Lord makes, I invite him to withdraw the amendment.

--- Later in debate ---

[Lord Faulks]

My Lords, I return to a group of amendments concerned with the regularity of the review of the discount rate. I raised this matter at Second Reading, in Committee and on Report, so I will not weary the House by going over the arguments again. Suffice it to say that I entirely agree with what the Bill does in providing for the obligation to have regular reviews at a certain juncture, although the Lord Chancellor has the right to have an earlier review if necessary. My argument, which I am glad to say the noble Earl, Lord Kinnoull, supports, as I think others in the House do, is that it is important that the reviews be regular and there would be an obligation to hold them, but that they do not have to take place too frequently. Why is that? Because those involved in litigation, on both sides, will inevitably seek effectively to guess—however well informed that guess might be—what the discount rate will be after it has been determined.

If there is to be a change every three years, the period leading up to the moment of change is likely not to result in settlements or to result in adjournments—in other words, in perfectly legitimate gaming of the system. This will happen inevitably whenever a review is about to take place, but it will happen less often if it is five years than if it is three years. This will, I think, help to produce more settlements. There are always uncertainties in litigation, but this is a particular uncertainty in large cases, where the discount rate can have such an effect on the quantum of damages. My submission is that five years, for the reasons I have already advanced, remains a better provision than three years. I accept that any provision is arbitrary, but I hope that the Government will listen to me today, will take into account all the evidence they have obtained and decide that, after all, five years might be a better period than three years. I beg to move.

[Lord Beecham]

My Lords, I am slightly puzzled at the effect of amendment as moved by the noble Lord, because the Bill prescribes that the rate of return must be started within a period; not every three years, or every five years, but within that period. So potentially, it seems to me—perhaps the noble and learned Lord will either correct me or confirm that I am right—that you could have a review at less than five years, depending on the circumstances. If, for example, there were a crash, as in 2008, which affected rates of return and so on very significantly, you would not have to wait up to five years to deal with it; you could have that review within the period. In effect, any time within that five years could mean a three-year review, a shorter review or something with a maximum of five years. If that is the case, is that acceptable to the Government?

[Lord Keen of Elie]

My Lords, I am obliged to my noble friend Lord Faulks and to other noble Lords who raised this matter in Committee and on Report. On the point raised by the noble Lord, Lord Beecham, it is indeed the case that we are talking about a maximum period for review, and therefore it can be at any time within that period. What we are concerned to avoid is the situation that arose in the past where many years passed before a review was carried out.

The choice between the two periods, three years and five years, is essentially a pragmatic one, I suggest. The arguments for the two options appear to me to be quite evenly balanced. A number of noble Lords have made the point that there would be less likelihood of a gaming of the system if that period were extended to five years. It was a point made in particular by the noble Lord, Lord Marks, on Report, when he indicated that he would prefer a five-year period over a three-year period.

Following discussions with several of your Lordships after Report, we have given further consideration to the question of the length of the review cycle and we accept that a five-year maximum period could help to reduce the effect of the litigation practice of trying to game the system, as distinct from a three-year period. In light of the arguments that have been made, the Government propose to accept these amendments.

--- Later in debate ---

[The Earl of Kinnoull (CB)]

I was not intending to speak, but I associate myself entirely with the remarks and thanks made and given by the noble Lord, Lord Marks. I was going to add only what fun it has been working with the Bill team, who have worked immensely hard. They have done a particularly good job on this Bill, which should be recorded.

[Lord Beecham]

My Lords, I am not sure I have enjoyed much fun as we have gone through this Bill but, as it leaves the House, I thank the Minister and his colleague on the Front Bench, and the Bill team for their readiness to discuss its provisions and respond to some, at least, of the concerns and suggestions that have been made from all sides of the Chamber. I also express my admiration for those who have brought their professional expertise and knowledge to our debates and discussions. It has been quite an awesome experience to listen to some of those who have spent a lifetime dealing with these matters.

Nevertheless, from these packed Benches, we believe that the Bill is fundamentally flawed and hope that, when it returns to us, it will have been improved. In particular, we would like to see the definition of “whiplash” made by medical experts and the damages determined by the judiciary based on Judicial College guidelines, rather than by a tariff specified for whiplash injuries. If there is to be a tariff, the college should be involved in determining the levels.

The Law Society suggests that the Government should clarify what would constitute a failure to take reasonable steps to mitigate the effect of an injury, which is part of the Bill’s proposition. It is also concerned about the provision in Clause 3 that means the capacity of the Lord Chancellor to allow discretion to increase the award in exceptional circumstances is by way of regulation, again, rather than being left to the judiciary to determine what constitute such circumstances.

Underlying the Bill and the proposals to raise the small claims limit for whiplash injuries to £5,000, and for other personal injuries to £2,000, is the effect of creating obstacles to justice likely to deter legitimate claimants from pursuing and receiving compensation. Where they do, they are likely to add to the growing difficulties experienced by the courts in dealing with unrepresented litigants. To most Members of this House, the sums involved are very modest; to many potential claimants, they are not. For our part, we will in future seek to oppose the intended increase of the small claims limit to all RTA cases to under £5,000 and for all other personal injury claims to £2,000, when the relevant regulations are laid.

We look forward to a review of the impact of this legislation on the much-vaunted claims of the insurance industry significantly to reduce insurance premiums—the noble and learned Lord has referred to that aspiration, as I would describe it—and, more positively, to a significant growth in the number of periodical payments orders in the most serious cases of injury, which are the subject of Part 2 of the Bill, which deals with the discount rate. That is the most positive part of the Bill, and it certainly has our support.

It has been an interesting experience to participate in these debates, and I hope that the Bill will return to us in due course, in an improved form. I await that moment with barely contained impatience.

Bill passed and sent to the Commons.

National Probation Service

Lord Beecham Excerpts

Wednesday 27th June 2018 Lords Chamber

Asked by

[Lord Beecham]

To ask Her Majesty’s Government what plans they have to review the effectiveness of the National Probation Service.

[The Advocate-General for Scotland (Lord Keen of Elie) (Con)]

My Lords, the National Probation Service supervises the highest-risk offenders. The Chief Inspector of Probation has consistently found the overall performance of the National Probation Service to be good. The Ministry of Justice has no existing plans to review the effectiveness of the NPS.

--- Later in debate ---

[Lord Beecham (Lab)]

My Lords, the Justice Committee’s report is a damning indictment of the coalition Government’s so-called transformation of the probation system, with its split between the probation service and community rehabilitation companies, and with privatisation involving the usual suspects such as Serco. The committee is,

“unconvinced that … the … model can ever deliver an effective or viable probation service”,

and asserts that,

“Staff morale is at an ‘all-time low’”.


CRC performance has been “disappointing”, and the voluntary sector is “less involved” than before. The committee also criticises the Ministry of Justice’s ability to let contracts. One shocking revelation by the Chief Inspector of Probation was that 40% of offenders are supervised merely by six-weekly telephone calls. She agrees that the system is “fundamentally flawed”. Do the Government intend at all to address these problems? And can the Minister reassure the House that the chairman of the Justice Committee, Sir Bob Neill, will not be dispatched to Afghanistan when these matters are debated in the Commons?

[Lord Keen of Elie]

My Lords, I am not aware of any Member of the other place having been dispatched anywhere. With regard to the Justice Select Committee report, we are of course aware of its terms, and we are taking action to consider the terms in which it has reported. As the committee observed, it is important to understand the effect that probation can have on those leaving prison. It is often a cross-government and cross-departmental issue; for example, it involves issues such as homelessness, as well as other through-the-gate services. With regard to the situation of the CRCs, there are some instances in which they are working effectively with the National Probation Service, but we accept that there have been challenges. It is clear to us that the CRCs’ services need to be improved, and that is being addressed at the present time.