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Political challenges ahead to Jackson/LASPO changes

Are the Jackson Reforms sufficiently permanent to be able to survive a future change of Government? Until now, there had been no word that a future Labour Government, if elected in 2015, would make any significant change to the Reforms which are being introduced this year.

Are the reforms politically safe?

It seemed, before now, that the Reforms broadly had cross party acceptance, even though insurers probably appreciated that the level of fixed costs payable would be affected by the identity of the party of Government, and so could be increased under a Labour Government which would probably be more open to persuasion by the claimant lobby which would be arguing for an increase.

The first sign of an alternative approach from Labour has just come with a speech from the shadow Minister of Justice, Andy Slaughter. Just as one of the current ministers in the MoJ, Helen Grant, had been sympathetic to the plight of claimant solicitors during the period of reform, so is Mr Slaughter, but he went further referring to an "unprecedented avalanche of change", which he said it had been foolhardy to introduce so suddenly.

Mr Slaughter indicated that if Labour were elected, there would be a further consultation within which he suggested that more weight should be given to the views of the legal profession than the current Government had been willing to listen to. In a criticism of the current Government's approach, Mr Slaughter's speech reportedly contained the view that "politicians have a problem when they look for quick fixes or listen too much to one side of the argument".

The signs now are that the Jackson Reforms have moved into the area where they are going to be the subject of political debate rather than cross party acceptance. It seems clear that the Labour party is beginning to be sympathetic to the position of claimant lawyers, and the fact that they have been sidelined recently because there might have been a Government view that those lawyers had been "feathering their own nests", as Mr Slaughter put it.

As we know, the Ministry of Justice has previously said through Helen Grant that the Government's response to the whiplash consultation including the level of the small claims track which closed in March would not be published until this autumn. On that issue, Mr Slaughter was again critical, saying that it was wrong to think about further reforms, when it had not yet been possible to assess the effects of the existing Reforms. His view was that the current Reforms needed to bed down, before their effect could be assessed.

An Early Day Motion has been put down in Parliament noting concern at the proposed increase in the small claims track limit from £1,000 to £5,000, and stating a belief that those plans should be reconsidered until a full assessment has been carried out of the current Reforms. Until that has happened, the Motion criticises "further and potentially unnecessary changes without sufficient evidence and justification".

The motion currently has 42 signatures of MPs, including two Conservative MPs, one of whom is the chair of the 1922 Committee.

Professor Fenn, who has been significantly involved in fixed costs matters surrounding the extension of the portal also joined in the criticism. He is unhappy that ministers have rejected his view that before the portal undergoes its planned extensions as at 31 July, more experience of its use should have been collected, and then a review undertaken. He is also concerned that the fact that costs are not more directly linked to damages except through the use of broad quantum bands is likely to lead to under settlement, as claimant lawyers advise claimants to take insurers' first offers.

The forthcoming portal changes are now set in stone as far as the making of the decision to proceed is concerned, though the surrounding new rules and sign off of the new protocols is awaited. While the Minister of Justice himself, Mr Grayling, is unlikely to be swayed, insurers should recognise that the claimant lobby now has through these developments begun to find its voice again, and that they will need to work hard to ensure that the Reform agenda does not succumb to political opposition.

For further information contact Simon Denyer, Partner on 0161 604 1551 or email simon.denyer@dwf.co.uk

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.