Legal Aid, Sentencing and Punishment of Offenders Bill

Andy Slaughter Excerpts

Wednesday 2nd November 2011 Commons Chamber

[Mr Djanogly]

I want to try to avoid delay today, so I shall speak to Government amendments now and respond to the points made in debate later, rather than pre-empting in my opening remarks what hon. Members may have to say about their amendments.

Government new clause 4, which is a technical amendment, has two purposes. First, it seeks to provide clarity about the role of the director of legal aid casework, by ensuring that the exercise of the functions of the office is on behalf of the Crown, and that service as the director is service in the civil service of the state. The second purpose of new clause 4 is to ensure that the Lord Chancellor is treated as a corporation sole for the purposes of part 1 of the Bill.

The new clause is necessary in order to clarify the position in relation to the Lord Chancellor’s ability to hold an interest in land for those purposes, and so applies to charges that transfer from the Legal Services Commission to the Lord Chancellor at the point when the LSC is abolished, and for future charges to be taken over property under clause 24. The statutory charge is the charge that arises under clause 24 on any property recovered or preserved, including costs, by a legally aided person in respect of the amounts spent by the Lord Chancellor in securing their legal aid services and any other amounts payable by them under clauses 22 and 23. The amendment is essential, as the current value of charges held by the LSC is £212 million.

Government new clause 9 and new schedule 3 make provision on information sharing in relation to checking a person’s financial eligibility for legal aid in Northern Ireland. They replicate for Northern Ireland the information gateway for England and Wales created by clause 21 and further provided for in clause 32. Government amendments 26 and 27 are technical amendments that make it clear that regulations made under new schedule 3 will be prescribed not by the Lord Chancellor but by the Northern Ireland Assembly. Government amendment 54 is also a technical amendment that makes it clear that the Bill extends to Northern Ireland for the purposes of new clause 9 and new schedule 3, which create the information gateway, and for the purposes of clauses 38 to 40. I should point out that under paragraph 2(4) of new schedule 3, it will be a criminal offence to use or disclose information contrary to the provisions of paragraph 2.

Government amendments 25 and 64 to 68 relate to the transfer of LSC employees to the civil service when the LSC is abolished. The powers currently set out in the Bill include a power, in schedule 4, for the Lord Chancellor to make transfer schemes to transfer to the Lord Chancellor or the Secretary of State the LSC’s rights, powers, duties and liabilities under or in connection with an LSC occupational pension scheme, of which there are currently two, or compensation scheme. The occupational pension and compensation scheme arrangements for LSC employees are different from those for existing civil servants. When the employees transfer to the civil service and become civil servants, they will join the principal civil service pension scheme.

Amendment 64 confers new powers upon the Lord Chancellor that can be exercised as part of any transfer scheme. Proposed new sub-paragraph (6A), set out in amendment 64, allows for the Lord Chancellor to apply legislation with modifications as far as it is necessary to give effect to any transfer scheme. That is appropriate when transfer schemes are of an administrative nature relating to the specific issues in question. For example, it will allow the Lord Chancellor to provide that an aspect of pensions legislation applies in a particular way to that particular scheme. It will assist, as appropriate, in enabling the continuation of the LSC pension scheme or schemes after the abolition of the LSC so that they can continue for the benefit of their pensioner and preserved members. Those are members who have contributed to the schemes before leaving LSC employment and either draw a pension from the scheme or will be entitled to do so in future.

For compensation scheme arrangements, as well as allowing the modification of legislation, proposed new sub-paragraph (6B), set out in amendment 64, provides that the transfer scheme may amend or otherwise modify the existing LSC compensation scheme. That will allow compensation arrangements for LSC employees transferring to the civil service to be brought into line with those of other civil servants over a transitional period.

Amendment 65 reflects the fact that when LSC employees transfer to the civil service there will no longer be any active members of the two current LSC occupational pension schemes, known as the No. 3 and No. 4 pension schemes. The amendment provides the Lord Chancellor with the power to make a scheme to merge the two residual pension schemes. It is explicit that a scheme exercising this power must not result in members of the pension schemes, or other beneficiaries under the schemes, being deprived of any rights accrued prior to the merger.

The LSC’s No. 3 pension scheme has fewer than 100 pensioner and preserved members, and no current LSC staff members. The No. 4 scheme is for current staff and also has a number of pensioner and preserved members. At present there is much duplication in the administration of the No. 3 and No. 4 schemes, such as producing two sets of accounts and actuarial valuations. Merging the schemes would allow us to cut significantly the administration costs of running two trust-based schemes. The amendment will also give the power to wind up an LSC occupational pension scheme.

Amendment 25 corrects a slip in clause 38(7)(j). The intention was not to make regulations that contain free-standing provision that modifies an Act either directly or indirectly, subject to the affirmative procedure. Amendments 66 to 68 clarify the fact that the regulation-making power provided to the Lord Chancellor under paragraph 10 of schedule 4 can be used in connection not only with transfers affected by schedule 4, but with schemes under schedule 4, meaning schemes dealing with something other than a transfer.

Government amendments 137 and 138 concern schedule 4 to the Bill, which governs transfers of employees and assets following the abolition of the LSC. They are purely technical amendments that simplify existing provisions. Paragraph 10(1) of schedule 4 currently allows the Lord Chancellor to make consequential supplementary, incidental or transitional provision by regulation, and paragraph 10(2)(b) specifies separately that such regulations may include transitory or savings provision. Rather than continue to separate these related provisions, for the purposes of simplification amendment 137 brings them together in a revised paragraph 10(1) and amendment 138 amends paragraph 10(2) to reflect that simplification. That mirrors an identical amendment to clause 115.

Finally, Government amendments 1, 2 and 19 are minor and technical amendments to clause 32 and schedule 5, consequential on the removal in Committee of what was then clause 71.

[Mr Andy Slaughter (Hammersmith) (Lab)]

If the Minister was sincere when he said in his opening remarks that we will make good progress and deal with as many of the groups of amendments as we can today, I applaud him for it, but it is a challenging task. There has been a statement so we have barely four hours left to debate huge chunks of the Bill, which is impractical. It will no doubt be assisted by the fact that, with the exception of the Minister’s Parliamentary Private Secretary, who has just appeared, there is not a single Conservative Back Bencher here. [Interruption.] I apologise to the hon. Member for Hendon (Mr Offord); I thought he was a Liberal Democrat. I withdraw that slur on his character immediately.

There is a serious point. We had a disgraceful situation in the House on Monday when the Minister called in Conservative Back Benchers, one by one, to speak on domestic violence and clinical negligence, particularly as they affect the most severe injuries and brain-damaged children, and to waste time. By wasting time and then voting against amendments that would deal with those issues, the Government prevented us from moving on to a substantive discussion on legal aid. I will not dwell on that point, because I wanted to move on, but I hope that in discussing these amendments, of which there are a broad range, we will be able to do justice to that important subject.

I will speak principally to amendment 123, which stands in my name. I will get my contributions out of the way in one go by speaking to new clause 17, tabled by my hon. Friend the Member for Makerfield (Yvonne Fovargue), amendment 148, tabled by Liberal Democrat Members, who for some reason rejected a similar amendment I tabled, and new clause 43, tabled by the hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards), which is a very good one. I will say at the outset that we support all those amendments. I will not deal with amendment 116, which stands in my name, because my hon. Friend the Member for Darlington (Mrs Chapman) will make a contribution on that later. For the avoidance of doubt, I will say at the outset that the Opposition will press amendment 116 to a vote, and other hon. Members may wish to press their amendments to a vote.

Amendment 123 deals with a fairly straightforward point, but an important one, which is in no way party political. The independence of the new director has raised considerable alarm and concern across the professions and the voluntary sector, and indeed with anyone who deals regularly with legal aid. We attempted many times in Committee, with a variety of amendments, to try to push at this and get the Government to give a little. We asked for an appeals process, a vetting process before appointment, which would give some independence, and for assurances in relation to the civil service, which will be working in this area. Every amendment, as was the case throughout the Committee’s proceedings, was rejected. I hope—this is the case in other common law jurisdictions which have moved to a similar system—that the Minister is listening to these proposals. This is not an issue that divides the parties on the abolition of the Legal Services Commission, but it is an issue that strongly divides the parties on the adverse influence, be it perceived or real, that the Government will bring to bear on to the director post once it is firmly ensconced within the Department.

There is a trend in this Bill towards Government control and authoritarianism, and we will see it when we debate clause 12, whereby the same director of legal aid will get the power to decide whether legal aid is granted to those in extremis—in the worst circumstances—when they have been arrested. We also see the trend in relation to the constraints on the powers of the judiciary, and, although I doubt that we will get time to debate remand today, I note that the Government wish severely to tie the hands of magistrates and judges in relation to whom they can remand in custody. All the time, these measures restrict either citizens’ rights or the rights of independent parties, whether they be the director or the judiciary, to make decisions.

--- Later in debate ---

[Mr Slaughter]

The presenter made a mistake—I hope the Minister is not making the same one—in relation to talking about legal aid, as presenters often do, but I assure the House that Mr Jefferies was clearly talking about conditional fee agreements and no win, no fee. The answer is—

[Mr Djanogly]

Yes, but we are talking about legal aid.

[Mr Slaughter]

I know the Minister does not want to hear this, but in relation to the director the point is that the Government wish to decide who has merit and who does not. That is the charge that the Government have to answer, and in this case they will do so only by ensuring the independence of the director.

Let me move on, because we are in the midst of a radical reform of the social welfare system. The Secretary of State for Work and Pensions has embarked on restructuring the way benefits are assessed, calculated and provided, local authorities have had budgets radically reduced, and a housing benefit cap is being introduced. In short, the benefits system is in a period of turmoil, and as a consequence the system of checks and balances on state decision making through the first-tier tribunals is also significantly under pressure, such that more staff are being taken on daily to deal with a growing number of appeals against decisions taken by Jobcentre Plus.

When in October last year the coalition produced its Green Paper on the reform of legal aid in England and Wales, we were shocked to see that there were cuts of £450 million, as defined in the latest impact assessment, and that they overwhelmingly came from civil legal aid. Things such as education, employment, welfare benefits, debt, housing matters and clinical negligence were taken out of scope, either in their entirety, as in the case of employment, welfare benefits and clinical negligence, or substantially, as in the case of debt, housing and education.

Means-testing will also change. The Government have proposed the abolition of capital passporting, by which those receiving certain income-based benefits are automatically eligible for legal aid, and the introduction of a new minimum capital contribution, a personal financial contribution towards legal costs.

The philosophy behind the cuts is explained in the Government’s impact assessment, in which they state:

“Legal aid may be regarded as a redistributive transfer of resources from taxpayers to those who are most needy, in relation to both the nature and merits of their case and also to their financial position… The Government may consider intervening if there are strong enough failures in the way markets operate…or if there are strong enough failures in existing government interventions”.

The amendments under discussion simply seek to address the Government’s failure to abide by those principles as set down in their own impact assessment. We are in a period of great need and of great changes to the system, and many meritorious cases are being referred to tribunal. By definition, the financial position of those requiring help with welfare benefits, employment law, debt and housing is necessarily the most precarious of any in society, and £70 a week is often all that stands between some of my constituents and utter destitution. They are in a desperate place.

Let me give the House one example, in relation to eligibility for disability living allowance. There are so many problems with the private contractor Atos that many seriously ill people are being judged fit for work. I leave aside operational issues, such as the fact that, according to its own website, 20% of Atos’s 141 medical assessment centres do not have wheelchair access, because, according to a newspaper report, one third of those refused DLA by Atos have appealed to the first-tier tribunals, and 39% of decisions have been overturned. Furthermore, the report states:

“The tribunals service…has had to double its capacity in the social security section to deal with the large number of appeals, recruiting an extra 170 paid medical panel members.”

In a letter to The Guardian, leading mental health charities and a senior consultant from the Royal College of Psychiatrists say:

“We’ve found that the prospect of incapacity benefit reassessment is causing huge amounts of distress and tragically there have already been cases where people have taken their own life following problems with changes to their benefits.”

These are not just economic issues; they profoundly affect the most vulnerable individuals.

The Government’s proposals will seriously damage access to justice for the most vulnerable in society, and their own impact assessment shows that there will be a disproportionate impact on women. Similarly, there is the potential for the cuts to impact disproportionately on black and ethnic minority clients and on those with disabilities.

That is something the Minister himself acknowledges. When it was put to him that groups with protected characteristics would be affected, he dismissed it, as only a Conservative Minister can, although the Liberal Democrats are getting there, by saying, “Well, that’s because they are disproportionately represented among the most vulnerable.” That is the logic of the Government’s case—“Because vulnerable people get legal aid, and we are cutting it, what do you expect to happen?” Those principles show an absolute absence of moral guidance.

[Sir Alan Beith (Berwick-upon-Tweed) (LD)]

I understand the hon. Gentleman’s argument, but is he proposing cuts in other areas of legal aid in order to maintain his objective of cutting the overall cost while putting legal aid back in place in those fields?

[Mr Slaughter]

I was going to deal with that at the end of my remarks, but let me do so now. I am grateful to the right hon. Gentleman for giving me the opportunity to do so, because two days ago the Minister said, “Oh, the Labour party wants to reinstate £245 million of cuts.” On the same day, however, he put out a press release saying that the Labour party wanted to reinstate £64 million of cuts, and I have grown tired of responding to him. He has heard my response from this Dispatch Box, in Westminster Hall and in Committee time and again, and it is simply this: we would not have made at present the cuts to social welfare legal aid.

The Minister quantifies those cuts as £64 million, but why did he not proceed with the final parts of Lord Carter’s review and go through the criminal tendering exercise, which was in place and ready to go when the Government took office last year, and which included savings that might have raised twice that sum? I anticipate the figures changing. The figures on savings have changed from £350 million to £450 million within two impact assessments, but, without being more precise than that, we believe that if the Government looked for efficiencies in the criminal legal aid system, first they would save more money than they are by cutting social welfare legal aid, and secondly there would not be the same social or financial consequences.

The Green Paper talks frequently about the possibility of self-representation as a reason for withdrawing legal aid provision, but data provided in answer to a written parliamentary question indicate that there are considerable differences in success rates between those with and those without representation. Owing to a lack of representation, 51,223 meritorious cases that were successful in 2010 at the first-tier tribunals, many of which involved applicants for DLA, incapacity benefit, jobseeker’s allowance and so forth, would not have been successful if the proposed cuts had been in place. The changes will close or severely reduce the operation of law centres, citizens advice bureaux and hundreds of independent advice centres, and limiting the scope of issues which legal aid-funded advisers can help with means that they will not be able to solve people’s problems fully.

New clause 17, in the name of my hon. Friend the Member for Makerfield, addresses precisely that issue. At the end of Monday’s debate, I gave the example of the Wiltshire law centre in the constituency of the hon. Member for South Swindon (Mr Buckland). That will lose 90% of its funding, and that is not untypical of the cuts being made. In most cases they are above 80%.

The specific issue that is dealt with my hon. Friend’s new clause is the interconnectivity of people’s problems. We are all too familiar, as constituency MPs, with the individual who comes in with two plastic bags full of paper and is unable to convey the scale of their distress, let alone the complexity of their problems, which may include unpaid debts, threats of eviction, underlying mental health problems and the inability to access the welfare benefit system. Sometimes we can help, and I pay tribute, as I am sure all hon. Members do, to the constituency staff who have developed phenomenal skills at unpicking these issues and dealing sympathetically with them. In many cases, however, legal expert help is needed, but that help will now be severely compromised. If one is allowed to deal only with the threat of eviction but not with the underlying issues of accessing benefits and dependency on debt, one is working with one hand tied behind one’s back.

The exceptions to the withdrawal of legal aid in certain cases, such as when an applicant for legal aid is at risk of homelessness, are nonsensical distinctions. People who come for aid early on, while they still have manageable rent arrears, can see their case deteriorate rapidly and drastically. The legal aid that would help exactly those people has been withdrawn, and that is Shelter’s No. 1 priority for what should be restored. Let me add, at this point, that we support the hon. Member for Carmarthen East and Dinefwr in his wish to undo what is a calumny in the Bill—measures allowing the Secretary of State by order further to restrict what is in scope for legal aid, but not to expand it. I do not know whether the hon. Gentleman is going to press his amendment to a vote tonight but I hope that, if he has an opportunity to speak, the Minister will give an indication that that glaring error in the Bill will be corrected.

The cost of dealing with a single case of homelessness has been estimated at £50,000 by Shelter. Early intervention is an extremely efficient and cost-effective way of preventing cases from becoming more complex, difficult to resolve and commensurately expensive. The legal aid Green Paper suggests a shift to telephone advisory services, and this brings us to amendment 148. Although these methods are an efficient and often effective means of delivering certain types of advice, clients presenting with complex or chronic problems gain far better outcomes from face-to-face advice.

Research by the Legal Action Group has highlighted the issues faced by the most vulnerable in utilising telephone advisory services. It found that full-time employees were the most likely to access an advice service through the telephone line or the internet, at 43%, whereas people in the lowest social class, DE, were least likely to access advice through an advice line or the internet, at 26%. This class of people was also the most likely to experience a social welfare law problem. The Minister’s own impact assessment says that the bottom 20%, in terms of income, will represent 80% of those who suffer from the withdrawal of these services. Overall, people of social class DE are twice as likely as people in all other social classes to experience problems with debts or benefits.

Issues facing the most vulnerable people include language, comprehension and somewhat more prosaic economic issues such as the expense of calling an 0845 number from a pay-as-you-go mobile when trying to get advice upon being rejected for jobseeker’s allowance. Citizens Advice has noticed a dramatic rise in the volume of cases and the number of people seeking advice in this recession. Advice has been focused on debt, housing, employment and difficulty accessing the benefit system. For example, between April 2008 and 2009, CABs in England and Wales saw daily inquiries relating to redundancy increase by 125%. Local authority cuts combined with the cuts in the Ministry of Justice have inflicted a double whammy on law centres, CABs and third sector organisations. Many organisations that are staffed by a mixture of volunteers and modestly paid staff will be forced to close or reduce staff and service breadth, depth and reach. Indeed, that is already happening.

We agree that the legal aid budget needs to be contained, as I have already said in response to the intervention of the Chair of the Justice Committee, the right hon. Member for Berwick-upon-Tweed (Sir Alan Beith), and that ways of making savings need to be found. When we were in power we did not shy away from taking those decisions and containing the budget. We had begun and were continuing to implement the recommendations of Lord Carter of Coles and we believe that those outstanding recommendations should have been implemented by this Government. Frankly, we are at a loss to understand why the Government have not looked at the scope of criminal legal aid or at how it is delivered in this country, preferring instead to target the poorest and most vulnerable. I accept that those changes would not have been popular with all the legal sector but they would have delivered substantial savings, which would have been greater than the total cuts to social welfare legal aid we have discussed this week. Let me pay tribute to my colleague the noble Lord Bach who, as Minister with responsibility for legal aid, took exactly that line. He was prepared to be very tough on his own profession but he always protected social welfare legal aid.

--- Later in debate ---

[Tom Brake]

There has not been much consensus in the Chamber, but I suspect that there is broad agreement on that point.

[Mr Slaughter]

The right hon. Gentleman is absolutely right. The Liberty briefing paper states that the

“Community Links advice service records that…73% of the benefits related cases handled by their staff arose as a result of errors on the part of the Department of Work and Pensions.”

The Opposition agree with him, but we are where we are, and particularly at this time of change, we need certainty that those people will be properly represented. I think he said that he would not support new clause 17, but will he support amendment 116 and, later, the new clause in his name or the new clause relating to the Dowlers, which is in the name of my hon. Friend the Member for Rhondda (Chris Bryant)? He has given assurances outside the House and said that he supports those positions, but he now seems to be resiling from them. Will he and his hon. Friends support those measures? Will he answer that question now?

[Tom Brake]

I thank the hon. Gentleman for his intervention, which is in the tradition of his speeches—lengthy. He should perhaps have waited until I had finished my comments before jumping to any conclusions.

--- Later in debate ---

[Mr Elfyn Llwyd (Dwyfor Meirionnydd) (PC)]

I have never been a tribal politician, and I understand the dynamics of the House, but I am very disappointed that the hon. Member for Edinburgh West (Mike Crockart) and his colleague, the right hon. Member for Carshalton and Wallington (Tom Brake), had nothing to say on this issue in Committee. Worse still, an amendment that would have dealt with clause 12 was pressed to a Division, but they declined to vote for it. Indeed, they voted against it. The right hon. Member for Bermondsey and Old Southwark (Simon Hughes) came to the debate in the House on Monday and said that he was interested in dealing with the immigration law aspect in the Bill, but again, his colleagues said nothing about that in those lengthy Committee proceedings. The right hon. Gentleman said that he would pursue the matter. The modus operandi of the Liberal Democrat party is to sit on a Committee, do nothing, and then come back on Report and pretend they have done a hell of a lot. I am rather disappointed in the right hon. Member for Carshalton and Wallington in that regard. I have never been a tribal politician, but when I see this kind of behaviour, it makes me a bit sick.

[Mr Slaughter]

I have three headlines from The Guardian, which are like a tableau. From September, we have “Liberal Democrats urged to defy plans to cut legal aid”; from October, we have “Lib Dem MPs rebel against proposals to cut legal aid funding”; and from yesterday, we have “Lib Dems have their cake and eat it”. That last article features a lovely picture of the right hon. Member for Carshalton and Wallington (Tom Brake). They rebel, and at the last moment, they do not.

[Mr Llwyd]

I have made my point, so I will move on to the substance of this important debate, because others wish to speak.

I support the hon. Member for Makerfield (Yvonne Fovargue) on new clause 17, the amendments tabled by the Official Opposition, and new clause 43 and amendment 162, which were tabled by my hon. Friend the Member for Carmarthen East and Dinefwr (Jonathan Edwards).

However, I am against clause 12, which threatens through secondary legislation to limit advice and assistance at police stations. I shall not speak for long, but it is important to deal with one or two aspects of the measure. Clause 12 could thwart the fundamental right to legal advice when held in police custody, which frankly is a time when individuals are at their most vulnerable. That the Government did not consult on that measure has been widely criticised by many, and not simply those who allegedly want to raise money. The Lord Chief Justice is not dependent on legal aid, as far as I am aware.

I spoke in Committee of the importance of people having legal advice and assistance when they are detained in police stations. No consultation was held, but the measure was pushed through. Clause 12(3) is particularly worrying, because it would allow the Lord Chancellor to introduce regulations requiring the director to apply means-testing provisions if he or she considers them appropriate. It is well known that advice and assistance on arrest are not currently means-tested. The introduction of that in a police station is utterly inappropriate. What is more, as the Bar Council has pointed out, experience over the years shows that errors and abuses at police stations are responsible for very many miscarriages of justice, which cost not only lives, but finances.

Amendments 90, 104 and 125, which are in my name, would ensure that as a matter of course advice and assistance would continue to be made available for individuals held in police custody—they would not be subject to any means or merits testing. Amendment 104 would remove the word “station”, and amendment 125 would remove the need for a determination by a director. Furthermore, amendment 90 would remove subsection (9) and state in its place that:

“Sections 20 and 26(2) do not apply”.

The first point clarifies that means-testing cannot be introduced at police custody. Negating the application of clause 26(2) would ensure that the Lord Chancellor was unable to replace advice in person at police stations with

“services to be provided by telephone or by other electronic means.”

Clause 12 has a grave potential to destabilise access to justice for some of the most vulnerable in our society. As Liberty has pointed out:

“Justice requires that, as a bare minimum, all individuals taken into police custody have access to legal advice and representation when facing criminal allegations with the potential loss of liberty, disruption and damage to reputation they entail.”

As anyone who has practised criminal law will know, the first couple of hours in custody can be crucial in determining whether a case goes further, even on to an interview. Most people, when facing a police interview, particularly for the first time, are unable to think clearly and may not be cognisant of their best interests. As I said in Committee, at the very least the initial interview at the police station should proceed on the basis that the solicitor will be paid for the first couple of hours. It seems that the Government were unwilling to listen to that concession.

--- Later in debate ---

[Ben Gummer]

May I just finish my point? At the beginning—

[Mr Slaughter]

rose—

[Ben Gummer]

I will give way to the shadow Minister.

[Mr Slaughter]

I hope that we can make some progress in this debate now. This is not helping—[Interruption.] The Under-Secretary of State for Justice, the hon. Member for Huntingdon (Mr Djanogly) is laughing. I hope that he is not going back on his earlier promise that we would make progress today. Had the hon. Member for Ipswich (Ben Gummer) been here earlier, he would have heard me deal with that point, in terms and at length, in response to an intervention from the Chair of the Select Committee. Will he stop wasting time?

[Ben Gummer]

The hon. Gentleman is a little previous. Had he allowed me to continue my point, as I had asked, he would have heard me address exactly what he said. I did hear what he said, albeit outside the Chamber. Let me deal with this point about the Opposition. If they are to be credible, they have to make alternative proposals for cuts to legal aid, which they promised in their manifesto and have promised since, to this Chamber. A few months ago, during the Public Bill Committee, they clung to the proposals made by the Bar Council and the Law Society, until those proposals fell apart. They fell apart to the extent that the Bar Council and the Law Society have had to revise them in a resubmitted document provided earlier this week. That was the Opposition’s first cost-reduction plan and it was not one of their own making—it was made by others.

Some £245 million-worth of amendments were tabled by the Opposition in the Public Bill Committee, along the lines of those proposed by the hon. Member for Makerfield, but with no suggestions as to where cuts might be made elsewhere. So we get to a point where there is a complete absence of the other side of policy from Her Majesty’s Opposition—it might provide some credibility to what they propose—until perhaps today, when the hon. Member for Hammersmith (Mr Slaughter) appears before the House saying, “We are going to bring in accelerated competitive tendering in criminal defence work.”

--- Later in debate ---

Conditional fee agreements: success fees

[Mr Slaughter]

I beg to move amendment 21, page 29, line 6, leave out Clause 41.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

With this it will be convenient to discuss the following:

Amendment 150, page 29, line 36, at end insert—

‘(4A) The amendments made by subsections (2) and (4) do not apply in relation to proceedings which include a claim for damages for loss or bodily injury resulting from exposure to a harmful substance or process where the claim is made against a person who—

(a) carries on business in more than one country, or

(b) owns (wholly or partly) one or more businesses carried on in more than one country or in different countries.’.

Amendment 164, page 29, line 36, at end insert—

‘(4A) The amendments made by subsections (2) and (4) do not apply in relation to a success fee payable under a conditional fee agreement made in relation to—

(a) any proceedings in relation to a claim for—

(i) libel,

(ii) slander,

(iii) misuse of private information;

(b) any proceedings arising out of the same cause of action as any proceedings to which sub-paragraph (a) refers.’.

Amendment 163, page 29, line 41, at end insert—

‘(7) The amendments made by subsections (2) and (4) do not apply in relation to a success fee payable under a conditional fee agreement made in relation to—

(a) any proceedings based on a claim of defamation; or

(b) any proceedings based on a claim of privacy under Article 8 of the European Convention on Human Rights; or

(c) any proceedings arising out of the same cause of action as any proceedings to which paragraphs (a) or (b) refer.’.

Amendment 22, page 31, line 1, leave out clause 43.

Amendment 151, in clause 43, page 31, line 45, at end insert—

‘(6) This section does not apply in relation to a costs order made in favour of a party to proceedings which include a claim for damages for loss or bodily injury resulting from exposure to a harmful substance or process where the claim is made against a person who—

(a) carries on business in more than one country, or

(b) owns (wholly or partly) one or more businesses carried on in more than one country or in different countries.’.

Amendment 165, in clause 43, page 32, line 4, at end insert—

‘(4) The amendments made by this section do not apply in relation to a costs order made in favour of a party to proceedings in a cause of action in relation to a claim for—

(a) libel,

(b) slander,

(c) misuse of private information.’.

Amendment 72, page 32, line 5, leave out clause 44.

New clause 39—Road traffic accident pre-action protocol—

‘(1) The Table in Rule 45.29 of the Civil Procedure Rules 1998 (SI 1998/3132) (Amount of fixed costs under the Pre-Action Protocol for Low Value Personal Injury Claims in Road Traffic Accidents) is amended as follows.

(2) The figure for Stage 1 shall be £200.

(3) The figure for Stage 2 shall be £400.

(4) The figure for Stage 3 for Type A fixed costs shall be £125.

(5) The figure for Stage 3 for Type B fixed costs shall be £125.

(6) Any further amendment to the Table shall not be made by the Civil Procedure Rule Committee but may be made by the Lord Chancellor by rules made by statutory instrument and may not be made until a draft of the rules has been laid before and approved by resolution of both Houses of Parliament.’.

[Mr Slaughter]

This is an important group of amendments to part 2 of the Bill, which deals with a complex and vital area of access to justice. Because there are only 20 minutes left to debate this group, and I want to be fair to the Minister and give him 10 minutes to reply, I shall speak quickly in the hope of getting through the main part of my argument. I should make it clear at the outset that I wish to press to a vote amendment 21, which would undo the destruction of conditional fee agreements that the Government are pushing through in the Bill. I also ask, with the leave of my hon. Friend the Member for Rhondda (Chris Bryant), the lead signatory to amendment 163, that we press that amendment to a vote.

Conditional fee agreements, also known as no win, no fee agreements, were brought in by a Conservative Government to preserve access to justice for those on moderate means at a time when vast areas were being removed from the scope of legal aid and eligibility criteria were being removed. The provisions were amended, with a remarkable lack of contention from the Conservative Opposition, in the Access to Justice Act 1999, to create their modern form.

The idea of contingency fee agreements was to create a viable market in legal services by introducing success fees paid by losing defendants—wrongdoers, in other words—to compensate lawyers for the cases that they lost, for which, of course, they received no fees. For lawyers, that form of payment by results meant not that they would take on spurious cases, but that they were allowed to take on cases that might be 75:25 or 50:50. That has created a system that works, for the main part, very well. It has created a viable market in legal services and permitted access to justice for millions since it was introduced.

What sort of people have availed themselves of contingency fee agreements? More than half of those who have used them have had an income below £25,000 a year and only 18% have had an income of more than £40,000 a year. Government Members carp on about footballers and models using them, but the average claimant is the average constituent.

How do the Government’s proposals work? First, winning claimants will lose. Victims will have to pay the costs of their insurance and their lawyer’s success fees from their damages—up to 25% of damages, aside from damages for future care, can be taken by the lawyer, and the insurance premium will take up even more of those damages, perhaps wiping them out altogether. To make up for part of those losses, the Government plan a 10% increase in damages for pain, suffering and loss of amenity. Simple maths should be sufficient to show that that will not make up for all losses.

Losing claimants, including those bringing speculative and nuisance claims, will gain. They will benefit because it is unlikely that they will have to pay the costs of the winning defendant—that is part of the perverse, qualified one-way cost-shifting scheme that the Government intend to introduce when the Bill passes.

Losing defendants—wrongdoers, in other words—and their insurers will gain. Wrongdoers will benefit, because they do not have to pay the cost of after-the-event insurance or the victim’s lawyer’s success fees, thus limiting their liabilities and those of their insurers. Winning defendants will lose out. A winning defendant will no longer be able to reclaim the cost of their defence, thanks to qualified one-way cost shifting. To summarise, winners lose and losers win. That is simply wrong.

There was a time when the Conservative party worried about access to justice, but now it appears to be nothing more than the parliamentary wing of the insurance lobby, which according to an investigation by The Guardian has donated £4.9 million to the Tories since the Prime Minister became leader.

I have spent the past few months speaking to victims who have used contingency fee agreements to get justice. I have heard them tell me how our justice system helped them, and their fears that others who suffer in future will not get the help they need. A number of areas of law will be badly—

[The Lord Chancellor and Secretary of State for Justice (Mr Kenneth Clarke)]

Will the hon. Gentleman give way?

[Mr Slaughter]

I would love to give way to the Secretary of State, but I have very little time—[Interruption.] If I have time at the end I will do so.

A number of areas of law will be badly affected by this legislation, and I should like briefly to touch on a few of them—[Hon. Members: Give way!]

[Mr Clarke]

I am sorry that the hon. Gentleman had to be bullied to give way to me, but there we are. I do not want him to exaggerate his case. No win, no fee was introduced by the Major Government and worked perfectly satisfactorily until the previous Government amended it. We are talking about how much winning lawyers are paid. The principles of access to justice and of no win, no fee are agreed on a bipartisan basis. They are not threatened at all by the Bill.

[Mr Slaughter]

I began my speech by informing the house how contingency fee agreements came about. Because the Secretary of State has merely repeated that, I will penalise the Minister by taking a minute off his time.

The Secretary of State believes that there are faults in the current system whereby lawyers are unjustly enriched—he may be right, and my right hon. Friend the Member for Blackburn (Mr Straw) and I, and many other hon. Members, would probably agree with him—but let us cure those faults. Let us not throw the baby out with the bathwater.

[Chris Bryant (Rhondda) (Lab)]

Some categories of proceedings are particularly expensive to advance, yet lead to relatively minor awards. For instance, the largest award in a privacy case is £60,000, and below that, £13,000. The vast majority of libel cases end up with awards of less than £100,000. The problem is that in those cases, families such as the Dowlers, and people such as Christopher Jefferies, who was on the radio this morning, would have no chance of access to justice.

[Mr Slaughter]

That is why I will be very pleased to support amendment 163, which is in my hon. Friend’s name. As I have indicated, there are some cases—libel is a good example—when damages are small, but the defamation is important. Under the Secretary of State’s scheme, more than the sum of the damages could therefore be taken in fees.

Let me go through other areas of law, and I will come to privacy at the end if I have time. On clinical negligence, it is unavoidable that there will be good and bad doctors, just as there are good and bad in any profession. It is just and proper that compensation is paid to anyone harmed as a result of inaction, negligence or incompetence when a medical professional fails to live up to their obligations. I say that despite the fact that when the Secretary of State gave the figures, he conflated the cost of damages, claimant costs and defendant costs and pretended that they were a cost figure in themselves, for which he had to make another apology to my right hon. Friend the Member for Tooting (Sadiq Khan).

On professional negligence, taking on a professional is always risky. No one knows the system better. People are never 100% likely to win such cases. Without success fees to compensate for the risk, many such cases will not be brought in future. So who will lose out? It will be the first-time home buyer whose surveyor negligently fails to spot subsidence, the pensioner whose financial adviser negligently makes a high-risk investment, the hard-working small businessman whose accountant negligently fails to prepare accounts and lands him with a huge tax bill that he cannot pay, and the bereaved family whose probate solicitor takes three years to deal with the case and then charges huge fees. Those are the kinds of case that our constituents experience.

--- Later in debate ---

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. That is not a point of order and the matter was dealt with earlier in the week. Let us have no more of that.

[Mr Slaughter]

Let me just say that if the Government start talking about conflicts of interest on this Bill, they will open a Pandora’s box.

[Mr Deputy Speaker]

Order. We are not going to open Pandora’s box. We are going to deal with the amendments before us.

[Mr Slaughter]

I was not talking about the Minister; I was talking about the Bill. I am not surprised that the Minister’s PPS is embarrassed by the Bill, after sitting through our proceedings in Committee.

The common link between parts 1 and 2 of the Bill is the destruction of access to justice in a way that we have not seen since the introduction of legal aid by a Labour Government after the second world war. The insurance industry is being given one of the biggest pay-offs in history which, as we know from experience, will go into the pockets of their directors and shareholders. While other aspects of this Bill display the startling incompetence of this Government, none shows their intent more truly than the provisions in part 2, which would give the whip hand to large public and private corporations, while taking rights away from ordinary people. What is the point in having rights if they cannot be enforced?

I ask the Liberal Democrats to look at amendment 21, which would deal with cases such as Trafigura and pleural plaques, and amendment 163, which would deal with cases such as that of Milly Dowler, and join us in the Lobby tonight.

[Mr Djanogly]

Amendments 21, 22, 72, 163, 164 and 165 all seek to undermine a fundamental element of the package of reform of civil litigation funding and costs based on the report prepared on behalf of the judiciary by Sir Rupert Jackson and now included in this Bill—the abolition of recoverability of success fees and after-the-event insurance premiums. I must say that I am rather perplexed by the amendments as in Committee the hon. Member for Hammersmith (Mr Slaughter) agreed that the intention of part 2 is

“perfectly sound, and it is one with which we have a great deal of sympathy.”––[Official Report, Legal Aid, Sentencing and Punishment of Offenders Public Bill Committee, 13 September 2011; c. 501.]

I will also deal with new clause 39, which is on the related but slightly separate matter of recoverable costs for low-value road traffic accident claims.

It is worth emphasising, as the Justice Secretary has just said, that we are not proposing to end conditional fee agreements or no win, no fee deals. What we are addressing is the substantial legal costs that go to lawyers under the current no win, no fee regime. Our reforms are designed to make these legal costs more proportionate, while enabling meritorious claims to be brought. This applies equally to defamation and privacy claims and multinational claims as to other categories of case, but it is worth reminding ourselves of some of the disproportionate costs that have arisen and that emphasise the need for our reforms across the board.