Whiplash and discount rate reforms – Minister summarises proposals at APIL conference

The Association of Personal Injury Lawyers’ (APIL) annual conference ends today, 18 April 2018, with what looks to be a timely “Law Reform and litigation update” session covering the discount rate, clinical negligence, small claims, court reforms and gastric illness. The keynote address yesterday was delivered by MoJ Minister Lord Keen, who touched on most of these topics in his speech. It is understood he did not take questions after the speech and left very promptly.

The MoJ has just released Lord Keen’s speech on civil justice reform and while it is worth reading, it really does not say anything new about the Government’s reform agenda and its preferred timetable for change.

Lord Keen summarised the main provisions of part 1 of the current Civil Liability Bill – the whiplash reforms – which is due to be debated in the Lords next week (on 24 April, at second reading). The legislative measures (tariff general damages and a ban on pre-medical offers) will be implemented at the same time as increases in the small claims track limit (which involve changes to the CPR) to £5,000 for motor cases and £2,000 for other injury claims. Having reviewed all the earlier MoJ material, we remain of the view that this package will be implemented for accidents after a specified date, and Lord Keen’s evidence to the Commons Justice Select Committee in January had indicated that MoJ is working to a date in April 2019 (although that could well slide into the second half of next year).

Part 2 of the Bill will reform the current legal mechanism for determining the personal injury discount rate, which Lord Keen said “is resulting in systemic over compensation” and referred to particular pressure on health service funding in this regard.

As other Ministers have done, he said that the government expects insurers to pass on savings generated by these reforms to their customers in the form of lower premiums. He added – without giving any specifics – that the government will be monitoring this “and will consider further action if necessary”. This section in particular – and perhaps the speech in general – may well have been met with some scepticism, if not cynicism, in the conference room.

The final section of Keen’s speech looked at three strands of costs reforms:

  • The government will, later this year, review the impact of part 2 of the LASPO Act reforms (ie the Jackson reforms) and, in a constructive note, he confirmed that the Civil Justice Council will host a conference to consider the impacts and that the MoJ will seek views and data from all stakeholders
  • On the latest Jackson proposals – widely extending fixed recoverable costs (FRC) – Lord Keen observed that “it is now time to consider the extension of FRC” and repeated that there will be consultation. Although he gave no indication of timing, this might be expected to dovetail with the LASPO review
  • He reported the imminent change to the handling of holiday sickness claims, for which a new protocol and a regime of FRC (at the same level as for pubic liability claims) will apply to claims notified on or after 7 May 2018.

Despite his appearance at the APIL conference, it is very likely that little Lord Keen said will have persuaded claimant solicitors of the government’s point of view on virtually all of the topics he covered. There is great deal of resistance in that sector to the various reforms and the strength of these views and the associated arguments will surely become a good deal clearer as the Civil Liability Bill progresses in Parliament, beginning with the debate in the Lords next Wednesday.

Kinley_A-4_web Update by Alistair Kinley, director of policy & regulatory affairs

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