Government response to whiplash reform petition and more MoJ claims volumes data
Yesterday saw the government publish its response to the petition set up on the parliament website which in turn responded to the Chancellor’s announcement of major reform affecting the personal injury claims sector and whiplash claims in particular. Predictably, the government response set out a case supporting the proposed reform. Additionally, the MoJ minister Dominic Raab has provided to parliament some new data on the issue of whiplash claims volumes which seems to confirm to government that its reform is needed, though in fact it is difficult to see a trend of increasing volumes from his figures.
This was launched swiftly after the Chancellor’s announcement, and the number of signatories currently stands at over 21,000. It calls for the SCT limit to be kept at £1,000. Two reasons are given in support. Firstly, the need to maintain access to justice. Secondly, it is said that if implemented the reform would “put firms of solicitors out of business” and would it would also “ensure that thousands of solicitors, barristers and judges are made redundant”.
When someone signs a parliament website petition they need to give their postcode which in turn identifies their constituency. This map shows the constituencies in which those signing in fact live. There is limited national coverage, but instead a high degree of emphasis towards the north-west of England. This is clearly linked to the substantial number of people working in the different parts of the claims industry who live in that part of the country.
The highest number of signatories we can identify in one constituency is currently that of the chair of the Transport Select Committee, Louise Ellman in Liverpool Riverside with over 400, but others with over 200 include West Lancashire, Bolton NE, St Helens North, Bootle, and Sefton Central. In George Osborne’s own Tatton constituency there are over 100 signatories. On the other hand, in other parts of the country there are many constituencies with fewer than 20 signatories, some only in single figures.
It seems reasonable to conclude from the response to the petition that the degree of opposition to the proposed reform varies significantly from area to area. This may in turn be relevant when the time comes for the government with its slim majority in the House of Commons to look to get its legislation removing general damages for whiplash through parliament.
The government response to the petition
This is required when any petition reaches 10,000 signatures, and in response to this petition the government’s response was put up on the website yesterday.
They refer to the fact that the limit for injury claims has been £1,000 for nearly 25 years and that on that basis “a revision is long overdue”.
They note with reference to data that while since 2006 the number of reported RTAs has fallen by over 20%, the volume of RTA injury claims has risen by nearly 50%.
Their ultimate message is that “the overall cost of these claims far outweighs the value to genuine claimants of relatively small amounts of compensation.”
As to use of the SCT, the response notes that while litigants are not precluded from using lawyers, that track is intended for cases which can be brought without them, and the government go on to say that “Most minor injury claims are straightforward enough to be brought without the need for legal representation, making them suitable for consideration in the SCT.”
One of the aspects raised by the consultation may well be to ask whether certain categories of injury claim such as at least some disease claims would generally fall outside that description and so not be suitable for the SCT, even if their value were below the new intended limit.
When a petition reaches 100,000 signatures, the Petitions Committee will consider it for parliamentary debate. We will need to wait and see if that scenario materialises. While the required Act of Parliament will have to happen in any event, that measure is only expected to deal with the proposed removal of general damages for whiplash, not the SCT rise. Any debate on the petition would therefore be a broader one.
Next steps on the reform
The response says again that a consultation will be launched on the detail rather than the principle in the New Year. This will they say be on both intended measures, so ruling out any early and separate introduction of an SCT limit increase. It continues to be likely that the two proposed reforms will be brought forward together. The government say the consultation will be accompanied by a detailed impact assessment. It is currently expected that the consultation will be launched in March.
We would continue to see late 2017 as a likely implementation date and the reform applying to accidents occurring after that date.
More claims data
We continue to await the Claims Portal data for October and November which remain overdue but which we may see released this week. In the meantime, last week the MoJ minister Dominic Raab answered an MP’s written question enquiring as to how many whiplash claims there had been over the last 5 years.
Mr Raab chose to answer with two sets of figures. Firstly, by reference to the published CRU data as “total motor PI claims” shown in an orange line on the graph below, which he rounded off to the nearest 10,000. And secondly by reference to data for what he called “total whiplash (including claims for neck and back)” shown in a blue line on the same graph.
The origin of the figures for “total whiplash (including claims for neck and back)” was not given by Mr Rabb. It seems to us that they involve his department having looked at the “total motor PI claims” figures which was the published CRU data and making what seemed to them to be a sensible discount of 70,000 per year for other non-whiplash types of RTA claim (though the reduction made was of only 50,000 for the first of the 5 years) to reach adapted figures. 70,000 is just under 10% of the total number of RTA claims as measured by the CRU.
The graph also shows in a green line the number of RTA portal claims. Note that this data only commenced in May 2010 and should therefore be seen as needing adjustment for 2010/11 and 2011/12 before use of the portal increased.
For the sake of completeness, and while the actual terms of the FoI request and its answer still remain to be published by APIL, we show on the graph the data they claimed was supplied to them by the DWP earlier this year being the number of RTA claims submitted to CRU which were for whiplash. The relevancy of the data obtained by APIL will depend not only on the actual terms of the FoI request, but the way the claims were logged by CRU, for instance the inclusion of symptoms other than whiplash may have excluded them from the request. In any event, these figures are out of sync with the other data and for present purposes have to be left to one side where the other data which is publicly available is relatively consistent.
The written question of Mr Raab no doubt was relevant to the proposed reform announced by Mr Osborne. The data given by him in response as shown on the blue line above made no direct reference to that available from the portal which has been continuing to show an increasing trend up until when last published. However, his adapted CRU figures seem to have shown to government enough of a reason to continue to want to act decisively in this area, though it must also be accepted that they show a marginally decreasing picture of RTA claims volumes over the last 4 years.
We continue to await further developments in this area.
This information is intended as a general discussion surrounding the topics covered and is for guidance purposes only. It does not constitute legal advice and should not be regarded as a substitute for taking legal advice. DWF is not responsible for any activity undertaken based on this information.