Ministerial unity on claims reform

The Government is determined to crack down on the compensation culture and has announced reforms, including raising the small claims limit, to tackle the problem … [and] will consult on the detail of these reforms in due course, with a view to implementing them as soon as the necessary legislation is in place.”

The two passages above are taken from separate answers to PQs given very recently by Treasury and Justice Ministers. The full text of both answers is set out in the body of this post.

The comments clearly show that both departments and both ministers remain committed to the general damages and small claims reforms set out in the 2015 Autumn Statement.

Consultation on these measures is expected to commence sometime after the European referendum on 23 June. That said, the Government’s legislative and policy priorities could change should the decision of the electorate be for the UK to leave the EU.

Those following the EU debate on reform closely may spot that the ministers who are united here on claims reform nevertheless find themselves on opposing sides of the European question.

7 June 2016 – Personal Injury: Compensation

Chris Philp: To ask Mr Chancellor of the Exchequer, what steps the Government is taking to reduce the number of personal injury whiplash claims.

Harriett Baldwin: Between 1 April 2013 and 6 April 2015 the Coalition Government implemented a substantial programme of reform to reduce and control costs, strengthen the medical evidence process and reduce incentives to pursue fraudulent and unnecessary whiplash claims.

Despite that progress, the present government remains concerned about the number and cost of whiplash claims, which is why further reforms were announced in the Chancellor’s Autumn Statement in November 2015. These new reforms will remove the right to compensation for pain, suffering and loss of amenity from minor whiplash injuries, and reduce legal costs by raising the small claims limit for personal injury claims to £5,000. The government will consult on the detail of these reforms in due course, with a view to implementing them as soon as the necessary legislation is in place.

15 June 2016 – Small Claims

Julian Sturdy: To ask the Secretary of State for Justice, for what reason the Government is proposing to raise the small claims limit to £5,000 rather than to £3,000.

Dominic Raab: The Government is determined to crack down on the compensation culture and has announced reforms, including raising the small claims limit, to tackle the problem. These reforms will build on previous measures taken by the MoJ to control costs, tackle fraud, strengthen the medical evidence process and reduce incentives to pursue trivial whiplash claims. £5,000 is considered to be the appropriate level for the small claims limit and the rationale for this will be set out in the consultation document which will be published in due course.


About the Author

akAlistair Kinley is BLM’s Director of Policy & Government Affairs.

Alistair is responsible for BLM’s engagement with government departments and regulators on policy and public affairs issues and consultations affecting the firm and its customers. He coordinated BLM’s market-facing activities in connection with the Insurance Act 2015 and the consultations which preceded its publication and introduction in Parliament.

He is a member of the Civil Justice Council (CJC), a regular speaker and experienced commentator on legal and procedural reforms and was a contributing editor to the Law Society’s Litigation Funding Handbook (September 2014).

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