Civil Liability Bill [Lords]

Stephanie Peacock Excerpts

2nd reading: House of Commons & Money resolution: House of Commons & Programme motion: House of Commons
Tuesday 4th September 2018 Commons Chamber

[Ellie Reeves (Lewisham West and Penge) (Lab)]

It is a pleasure to speak in this debate and to follow the hon. Member for South Leicestershire (Alberto Costa).

Since 2010, under this Government and the coalition before, changes made by the Ministry of Justice have left us with a legal system in a state of utter disrepair. Colleagues across the House, trade unions, lawyers and legal experts have all expressed deep concern about the implications of the Bill and the Government’s policy agenda, put forward under the auspices of cracking down on fraudulent claims. Of course, fraudulent claims are wrong and should be clamped down on, but the Bill is not the appropriate way to do so and its implementation would see a wholly disproportionate impact on access to justice.

Even the statistics being used in the Government’s bid to warrant such widespread changes are highly contested. Recent freedom of information requests showed that the number of whiplash-related injury claims recorded by the compensation recovery unit fell by 18% between 2017 and 2018. Insurance industry data has shown that, in 2016, 0.17% of all motor claims were proven to be fraudulent—a fall from the 0.25% recorded in 2015. We are simply not in the midst of a fraudulent claims epidemic, as Ministers would have us believe. What are indisputable, though, are the consequences of the full implementation of the Government’s legislative agenda and the vast impact it would have on access to justice for many across the country.

On the face of it, the Bill appears innocuous enough, yet it is a shell Bill whose true effect is felt only when combined with the raft of other proposals the Government are bringing forward—namely, the changes to the small claims limit. My concerns with this Bill are threefold: the measures detailed in part 1; the lack of a mechanism to pass on predicted insurance savings to customers; and the overwhelming impact this package of measures with have on access to justice for injured people.

The Bill paves the way for the long-standing and established Judicial Studies Board guidelines to be replaced with a rigid tariff system that would undermine judicial discretion and leave injured claimants much worse off. The draft tariff system presented by the Ministry has shown the reduction in payments for pain, suffering and loss of amenity for road traffic accident-related soft tissue injuries to be overwhelming. Injured claimants could receive up to 87% less than the 2015 average paid out under the existing guidelines.

Moreover, as a result of the proposed changes in the small claims limit—which is closely associated with the Bill—injured people would struggle to achieve access to justice. The raising of the small claims track from £1,000 to £5,000 for road traffic-related personal injury claims, and to £2,000 for all other types of personal injury claim, will cause thousands of injured people to fall out of the scope for free legal advice and representation, and potentially to be denied justice.

[Stephanie Peacock (Barnsley East) (Lab)]

Should not the Government make clear what these changes represent—a capitulation to the interests of the insurance industry at the expense of working people?

[Ellie Reeves]

My hon. Friend is absolutely right. The proposals constitute an attack on working people who, through no fault of their own, are injured in the workplace.

If the Government are intent on fraud reduction, why are those who are genuinely injured faced with receiving a fraction of what they would currently receive? Most injured people would happily give the money back if it meant that they were no longer injured.

Under the proposed tariffs, people will be given more compensation if their flight was delayed for three hours than they would receive after an injury lasting for three months. The idea of a £235 maximum payment for a three-month injury is not only laughable, but a clear assault on any reasonable definition of access to justice. The move to a tariff system helps no one but insurance companies, while customer premiums continue to rise. There are no measures in the Bill that would make it incumbent on insurance companies to pass on savings that are currently calculated to be £1.3 billion. I know that the Minister has suggested that the Government will table an amendment—as promised in correspondence with the Chair of the Justice Committee, the hon. Member for Bromley and Chislehurst (Robert Neill)—but it is disappointing that that afterthought has not been included in the Bill thus far.

The Government say that they are listening to those who have concerns about their policy agenda. It is true that, following the Justice Committee’s report on the small claims limit, they have postponed their changes until 2020, but the purpose of that delay is by no means a rethink of policy or agenda. These changes are still coming, and their effect will still be felt whether the package of measures is presented this year, next year, or the year after that. The Bill, which is being rushed through on the quick, will leave us with a textbook example of a change in the law with ramifications that we will not truly understand until much further down the line. By that point it will be too late: the damage will have been done, and access to justice will have been eviscerated for many.

We must not forget that Conservative Governments do not have the best track record on justice matters. The Conservatives were repeatedly warned before proceeding with their legal aid reforms in 2012, but the effects of the Legal Aid, Sentencing and Punishment of Offenders Act 2012 have gone further and deeper than was ever intended, with the number of civil legal aid matters initiated falling by 84% between 2010 and 2017. The changes in employment tribunal fees that were introduced under another Tory Lord Chancellor—which have since been found to be unlawful—caused a 68% fall in the number of single cases received per quarter by employment tribunals between October 2013 and June 2017. That was yet another ideologically driven Tory attack on access to justice.