The 2017 general election changed the political shape of the House of Commons. Mathematically, the number of 650 MPs equals that of a square pyramid (144+121+100+81+64+49+36+25+16+9+4+1); although it might be said that the hung Parliament that the election has produced is not necessarily as robust as its arithmetical analogue.
At 328, the sum of Conservative (318) and DUP (10) seats would be sufficient to govern and this seems to be where matters are headed. What might these developments mean for insurance-related measures which had been shelved or side-lined pending the election?
David Cameron announced his resignation this morning, albeit postponed, following the vote by a majority of some four per cent of the UK electorate in favour of the UK leaving the EU. The outcome will have serious consequences for the economy and for the financial services sector. More narrowly, certain Government projects that relate to general insurance may, however, still be taken forward. While there may not now be le grand déblocage of initiatives that a remain vote would have precipitated, we could still see several stalled proposals re-starting before the summer recess.
- The scope of compulsory motor insurance across the EU – of which the UK is still a member, albeit now in the departure lounge – is currently being examined by the Commission. We expect the DfT to engage with stakeholders, including insurers, in the next few weeks to look at the options in detail. As we have already noted elsewhere, a modest amendment to the Directive in order to avoid the most troublesome unintended consequences of the Vnuk case looks the likeliest course.
- The insurance regime for autonomous vehicles also falls within DfT policy. Roads Minister Andrew Jones MP announced a month ago that there would be consultation on this “over the summer”. If his seasonal timing is rigorously observed, then we should expect the consultation to open, and probably close as well, in the three months between the summer solstice (21 June) and the autumnal equinox (22 September).
- How proposed reforms of whiplash and small claims might develop is less clear. The principles were outlined by Chancellor George Osborne in November but fall within the policy area of Secretary of State for Justice Michael Gove. It is far from certain that either or both will remain in those positions come the autumn and indeed the Prime Minister, who was a champion of earlier claims reforms, this morning announced that he is to resign in the autumn. So very much watch this space on these particular proposals in the short to medium term. It is not entirely implausible that the Government could find these topics to be less of a pressing priority.
The Parliamentary session resumes on Monday 27 June for four weeks. Although the issues above are – given the gravity of the outcome of the referendum – hardly front and centre of national political debate, we nevertheless expect movement on most of them before the recess begins on 21 July.
About the Author
Alistair 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).
Earlier this afternoon, the Chancellor brought to an end speculation about whether funds for radical technology-driven reform to the court service would be made available. He confirmed that £700 million of the Ministry of Justice’s (MoJ) spending settlement would be allocated to this project, saying that “the Lord Chancellor has worked with the Lord Chief Justice and others to put forward a typically bold and radical plan to transform our courts so they are fit for the modern age.”
The flip side of this positive news – which BLM has been anticipating for several weeks – is that under-used courts will certainly close and, according to today’s announcement from the MoJ, it will continue to “look at changes to court fees”.
The detail of the nature of the change to court procedures and practices will only be clearer over the next few months. The project is very likely to require legislative support – possibly primary legislation as well as rule changes – and may well incorporate the findings of Lord Justice Briggs’ ongoing review of the fundamental structure of the civil courts in England and Wales. Continue reading