This article first appeared in the Law Society Gazette, 11 October 2017
By John Hyde
Lawyers have been told to assume the government will not push through whiplash reforms before October 2018. Simon Stanfield, chairman of the Motor Accidents Solicitors’ Society, told the group’s annual conference today that he expects the original deadline will ‘certainly be missed’.
The Ministry of Justice is tasked with pushing through the Civil Liability Bill, one of few pieces of legislation included in this year’s Queen’s speech. The bill, which is yet to be published, is expected to include a tariff for reduced RTA claims compensation and a ban on insurers making offers before victims have had a medical.
These reforms were set to come into force at the same time as an increase in the small claims limit to £5,000 for RTA claims.
Stanfield, whose group is in regular discussions with the MoJ, said full implementation may still be ‘some way off’, having been put back in the government’s priorities behind Brexit and other justice issues. The delay, said Stanfield, has created a great deal of uncertainty but has at least enabled legal firms to look again at their business model and consider how to survive in a different regulatory environment.
But the Simpson Millar solicitor said the time delay also undermined part of the government’s case for making the reforms in the first place. ‘The government wanted to disincentivise minor, exaggerated and fraudulent whiplash claims,’ he said. ‘Since then, tackling fraud has all but dropped off the government’s stated justifications for its so-called whiplash reforms. Fraudulent behaviour – which never was at a level suggested by the newspaper headlines – appears to be on the wane, with many cash-for-crash gangs busted by the combined efforts of the various intelligence and investigative bodies.’
Stanfield said MASS would continue to oppose the government’s plans, saying they create too many loopholes and leave the market open for unregulated firms.
On the discount rate, the calculation for adjusting compensation based on expected returns from investments, Stanfield said former justice secretary Liz Truss had taken the right decision ‘both legally and morally’ to alter the rate from 2.5% to -0.75%. ‘The reaction to the change in the discount rate was as predictable as it was disappointing,’ he added. ‘The previous rate was simply not adequately compensating seriously injured people for their future losses in the way the law intended.’
Simon Stanfield’s full Conference speech can be read here