Health and Safety: Common Sense Common Safety

Lord Phillips of Sudbury Excerpts

Thursday 25th November 2010 Lords Chamber

[Lord Black of Brentwood]

My Lords, I am delighted not only that we have an opportunity of an early debate on my noble friend’s compelling report but that I have the privilege of following the excellent maiden speech of my noble friend Lord Faulks. I should like to address the report’s recommendations that would have an impact on the media. I declare an interest accordingly as a director of the Telegraph Media Group and chairman of the Press Standards Board of Finance.

My noble friend’s report makes an unanswerable case for the reform of the system of conditional fee arrangements that are the genesis of the compensation culture. I am sure that those who constructed the Access to Justice Act 1999 that ushered in those arrangements had the best of intentions, but the law of unintended consequences, as the report perceptively highlights, has had a pernicious and deeply damaging impact on freedom of expression. I would go so far as to say that, even bearing in mind the highly unwelcome growth of the so-called super-injunction, I believe that there is currently no more serious threat to media freedom or the public’s right to know than the unfettered use by claimant lawyers of CFAs backed by the toxic combination of 100 per cent success fees and after-the-event insurance.

First, there is the question of cost. It is not uncommon, as evidence submitted to Lord Justice Jackson’s review revealed, that libel and privacy actions against newspapers end up with damages of as little as £5,000 with a cost of 20 times or more that amount. That is a frightening prospect, which could put some small publications out of business. I cannot overstate the deeply difficult commercial realities for much of the media. The perfect storm of profound structural change with a severe recession in advertising has left many publications battered and bruised. Too many local papers—the engines of local democracy—have closed and many more may do so. The issue of CFAs could be a significant component in that.

Even more important is the chilling impact on free speech. It is now too common that newspapers will fail to defend a claim, no matter how spurious it might be or how important the issue, because they cannot afford to take the risk. CFAs have become a seriously distorting factor in the editorial process, with issues often avoided because of fear of the consequences. The role of scrutineer, which is inherent in a free press, is undermined. My noble friend’s report rightly states that,

“the Government should adopt Lord Justice Jackson’s proposals as soon as possible”,

to end the recoverability of CFA success fees and after-the-event insurance policy premiums, which Lord Justice Jackson described as,

“the most bizarre and expensive system that it is possible to devise”.

I wholeheartedly agree with that, but my great concern is the question of speed.

The need for swift and decisive action is very real and urgent because the provision of news and information to the public is at stake, but for far too long there has been masterly inaction. The first government review of CFAs took place as long ago as 2003. Since then, there have been countless reviews about the crippling impact of the regime including annual official consultations, research, consultation papers and, to the best of my knowledge, at least two Select Committee inquiries. The first of this year’s crop of consultation papers, which seem to come round as frequently as the first cuckoo in spring, devoted an entire appendix of seven densely written pages to covering information about seven years of inquiries about proposals for CFA reform.

Your Lordships’ House backed interim measures, which did not require primary legislation, to deal with the issue of CFAs in the dying days of the previous Parliament, but the proposals failed at the final hurdle in another place. Now, as my noble friend has said, we have another review seven years after the first. The irony is that, with the exception of some of the claimant lawyers who have a vested interest, everyone seems to agree. Lord Justice Jackson supports reform. The Ministry of Justice and Select Committees have supported reform. Much of the senior judiciary—including the Master of the Rolls, who gave such a warm welcome to Mr Justice Jackson’s review—and the regional and national media support reform. This House supported reform. Yet we are still waiting as the problems grow ever more acute.

The latest consultation paper envisages that changes to the law and to civil procedure will be necessary to introduce these vital reforms. Encouragingly, the new business plan from the Ministry of Justice that was published recently states that the Government will bring forward the necessary primary legislation in the spring of 2011, immediately after implementation plans have been finalised in the light of the consultation response. As the Prime Minister rightly says in his foreword to my noble friend’s excellent report,

“Now we need to act”.

After seven years of prevarication under the previous Government, can we have a clear commitment to a timetable and an assurance that the necessary legislation will not be further delayed? There is a great deal at stake.

[Lord Phillips of Sudbury]

Can I ask the noble Lord to comment on the proposal in the Jackson report to replace conditional fees with contingent fees, whereby the plaintiff’s lawyer would take a slice of the damages?

[Lord Black of Brentwood]

It seems to me, my Lords, that that would be an admirable way forward. The Jackson report has had widespread support from within the media and I hope that it is implemented as soon as possible.