Civil Liability Bill [HL]

Baroness Chakrabarti Excerpts

2nd reading (Hansard): House of Lords
Tuesday 24th April 2018 Lords Chamber

[Baroness Chakrabarti (Lab)]

My Lords, one noble Lord’s declared interest is perhaps another’s experience and expertise, or perhaps even better put, interests and experience can sit simultaneously with a noble Lord. Perhaps uniquely, in what has been an incredibly thought-provoking debate, I seem to be without interest or expertise. However, I have listened with enormous care to the wonderful tutorial that noble Lords have given me. I have read, as have so many other noble Lords, many submissions to which we have had access in this House. Just as I respect the interests and experience of those debating inside this Chamber, I do not think it is completely fair to suggest that everything from outside is, as one noble Lord suggested, noise.

The noble Lord, Lord Faulks, said that there are some real polycentric issues at stake and important, occasionally competing, concerns. I do not accept that all insurers are unscrupulous, nor do I accept that all claims are fraudulent or indeed, that all professional legal practitioners who are trying to do their best for their clients in this area are ambulance chasers. Further, I too have had the benefit of meeting the Minister, so nor do I believe that Her Majesty’s Government are somehow completely captured by the insurance industry in what they are trying to do in this Bill. However, to improve it requires listening to some of the concerns that have been expressed both inside and outside the Chamber.

The Bill addresses its purported targets by—how can I put it?—circuitous routes. It is concerned with, at worst, fraud and, at best, inflation of, for example, whiplash claims. I agree with, I believe, the majority of noble Lords, that compulsory medical reports before settlement must be a good idea. It would be good to see clear provision in the Bill for the cost of such reports to be met by insurers where settlements are made. That seems completely fair, and might be something we could look to. But, essentially, the Bill does not directly deal with fraud.

Another stated target is unscrupulous claims managers and McKenzie friends. Again, there is nothing in the Bill about that public policy problem and social evil. These problems have been pointed out by a number of noble Lords, including the noble Lords, Lord McNally and Lord Hodgson, the noble Earl, Lord Kinnoull, my noble friend Lord Monks and the noble Lord, Lord Faulks. We know that there is some level of problem here; I do not think anyone doubts that.

Another target is the unfairness of overly high insurance premiums. Again, the Bill does not directly regulate insurance premiums. We are told that industry leaders have made a public pledge to pass on the benefits of limiting claims to insured persons, but there is nothing in the Bill at the moment to give teeth to that promise. It would be helpful to so many people to hear from the Minister about the teeth in that promise.

Finally, a target of the Bill is said to be devastating pressures on the NHS, and perhaps on social care, too. Again, this is a very indirect approach towards the devastating pressures on the NHS and on social care in this country at this time. I echo the sentiments of my noble friend Lord Beecham—perhaps other discussions need to be had about the 1948 Act and so on—that that devastating pressure has ultimately to be met with a more honest conversation about taxation with a country that loves its NHS.

Those are the targets. But, instead of the direct approach, the Bill approaches these problems somewhat indirectly. First, in relation to whiplash injuries in Part 1, it does this by limiting damages in a particular class of claims. I have to say that, on a day when there have been very special celebrations in Parliament Square, I was a little sad to notice that I was to be just one of two noble Baronesses speaking in this Second Reading debate. But that disappointment began to fall away when I heard the extraordinary, eloquent and principled speech from the noble Baroness, Lady Berridge. She spoke of the need to hear the voice not of lawyers, insurers or any other professionals and experts but of victims. I can only tell her that we heard that channelled through her voice today, and I am sure that people outside will be very grateful for that. She pointed out with particular clarity the problem of principle in singling out one class of victims—not even a whole class of victims but a class within a class of victims—and saying that they must have their damages limited by the Bill and by regulations under it, as opposed to other victims, who may also be inflating or misstating their claims.

That is a matter of principle and will be a concern for people on the outside who are looking to understand what is behind this legislation. It is important to address that principle if we are to retain the public’s trust in the legislative process and in public policy making. I moved closer and closer to the noble Baroness’s devastating logic when she spoke about the role of the Judicial College and her concerns about why these particular damages should be set by the Lord Chancellor, not by the judges, as with all other tortious damages in our law. The Minister will, no doubt, address her concerns.

The second circuitous route, and a matter of enormous concern expressed on all sides of the House, is the incredibly broad delegation granted to the Lord Chancellor in defining whiplash and then setting the level of damages. The Delegated Powers Committee’s findings on this cannot be easily ignored. We listened to the concerns and I hope we can take them on board in amendments as the Bill progresses. The noble and learned Lords, Lord Hope and Lord Thomas, the noble Lord, Lord Sharkey, and many other noble Lords pointed out that to give the Lord Chancellor the defining power over the problem and then the further power to set the damages is a step to far. It is a precedent that we do not want to set in any Bill. It is a wider constitutional point that applies to this Bill and we do not want to be doing it in future. It is a problem in relation both to the rule of law—and clarity and certainty in law—and to parliamentary sovereignty as opposed to ministerial fiat. I hope that the Minister will take that on board and that there can be further clarity and definition on the face of the Bill.

The third concern that has been expressed is about inequality of arms and, in particular, the effect of combining measures in this Bill with the increase in the small claims jurisdiction. As the noble Baroness, Lady Berridge, pointed out, in practice even amounts of money which are small to the ears of those of us in this Chamber are incredibly important to a lot of people who will hear about, and perhaps read about, this debate. Small amounts of money can be life changing for people. To leave a greater number of people who have been the victims of even relatively minor injuries unrepresented, with no means of recovering costs and, therefore, no means of getting proper representation, is an affront to access to justice. In the civil sphere in particular, that has already been diluted, if not positively undermined, in recent years.

The Bill attempts to nudge victims, even those with quite serious injuries, into becoming slightly higher-risk investors. Some on the outside have suggested that they are to become stockbrokers and have the confidence and expertise to become more adept at investing and managing single lump-sum payments. Noble Lords will have read the argument against that. Equally, the noble Lords, Lord Hodgson and Lord Faulks, and others have pointed to the inescapable logic of the preference for periodical payment orders. Yet there is nothing explicit in the Bill to incentivise those orders, as opposed to encouraging slightly higher-risk investments or discouraging playing it safe. In the case of an ordinary lay person who is not used to managing investments, particularly if they have had a serious personal injury, one can understand the instinct for playing it safe. Again, that was pointed out by several noble Lords. The point about lack of representation was mentioned particularly by my noble friend Lord Monks and the noble Lord, Lord Marks. I agreed with so much of what he said.

It is always worth listening very carefully to the noble and learned Lord, Lord Mackay of Clashfern, on matters of this kind. As I heard references to the discount, the complex nature of this decision, what is being asked of the Lord Chancellor in Part 2 and the prophet-like powers that the noble and learned Lord described, echoed by the noble Lord, Lord Marks, and others, I really thought that we might give further thought to how we could achieve greater clarity, transparency and accountability in the Bill for this incredibly complex decision over which so much might turn for victims and claimants on the one hand, but also, as the noble Lord, Lord Ribeiro, and others pointed out, for the NHS. I hope that on that matter, as well as on so many others in this Bill, there will be real room for the kind of thoughtful debate and constructive collaboration to improve what I believe to be a genuine attempt to balance a number of important societal interests.