John Hyde's blogs

AXA says what we all think on referral fees
John Hyde
Friday, 17 May 2013

I come from a depressing, end-of-the-line town called Clacton-on-Sea. You probably stayed there in a caravan once, but had the fortune to leave after a long rainy weekend. Not me, I was stuck there, with just candyfloss and those two-penny machines to see me through to 18.

Now, I’m allowed to say what I like about Clacton. But if any outsider ever dares do the same, they’ll have me to deal with. (Not much admittedly, but it sounds threatening.) Which brings me (and stick with me on this one) to referral fees.

This week poor David Fisher’s ears must have been red hot, for he has been the talk of the legal world. The AXA manager spoke only for a few minutes at a parochial Commons meeting on insurance, but his words lit the blue touch paper.

Fisher alleged that some personal injury firms are still paying referral fees for work and ignoring the SRA-policed ban.

There have been two markedly different responses. The first lot, from comments below the story, was full of fury towards Fisher – how could he possibly know? Where’s his evidence? Mind your own bloody business! My Twitter timeline told a different story – most solicitors reacted with a weary indifference. A collective ‘well duh’, if you will. Of course there are some still paying for cases – how naïve would you have to be to believe otherwise?

Is this the ‘Clacton syndrome’ at work? Do solicitors resent being told home truths if they come from an insurer on the outside? I have no evidence whatsoever that any firms are paying referral fees – why would there be any? There aren’t many unlawful activities that are carried out in the full glare of publicity. But will some be ignoring SRA rules? You’d have to guess so.

After all, plenty paid referral fees before they were legalised in 2004, and that was before the PI sector had grown so accustomed to using them as a crutch.

These are desperate times, and some will turn to desperate measures. If the penalty from the SRA is being struck off, what does it matter if your business is likely to fail anyway? The SRA has approached the business of policing the ban with all the enthusiasm of a teenager flipping burgers for minimum wage. Once there’s an inkling you’ll get away with it, some will take the chance.

The truth is there are plenty of firms paying into collective marketing schemes or joint advertising pools or group work-grabbing initiatives, or whatever euphemism you want to use. They’re all lawful but they’re propping up the same system as pre-ban. Ditto with the insurer-claimant joint ventures, in which all the profits that came from the referral fee conveyor belt are retained but behind a cloak of respectability.

Too often the claimant lobby has suffered from wilful blindness to the rogue elements in its midst. Too often it has defended the indefensible, leaving the government the easy job of lumping everyone in together and creating LASPO. If Fisher was talking rubbish, let him. But if there was any element of truth to his claims, it’s up to everyone in the industry to be honest and admit it.

I may deny Clacton is a sinkhole ‘til I’m blue in the face, but that doesn’t mean it’s not true.

John Hyde is a Gazette reporter

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Our only certainty is uncertainty
John Hyde
Friday, 3 May 2013

Sado-masochism, that's the only possible answer.

How else do you explain why so many solicitors line up for conferences about the future of the legal profession, like lobsters clambering to the front of the tank for a better view of the cooking instructions? I speak as someone with considerable experience of these things - in fact I reckon I've totted up so many CPD points attending conferences and seminars I'm now a solicitor by default.

The formula is the same each time. A speaker with the title of professor will tell everyone they're doomed. Then an investment banker will tell them how long the agony will last.

There's a quick break for coffee, at which everyone scavenges for free pens, before shuffling back in to be told how terrible they are at running a business. If they're really unlucky the poor schmucks will then be told by a 'consumer champion' that the public hates them because a survey of six people and an Oompa Loompa told them so.

That's not to say the speakers aren't talking sense. Public perception of lawyers (not the perception of actual clients, you'll notice) is pretty low, largely because their only experience of lawyers is 'briefs' ham-acting on EastEnders.

And of course, those investors and academics are right. The market will contract and banks are lending to law firms with all the trepidation of Nigel Farage in a Bucharest bar.

Private equity investors tell me law firms are queuing round the block for capital like impoverished families at a food bank. Interestingly, the 'consolidation in the market' predictions are nothing new. I heard the same thing at these conferences two years ago (often from the same people) and yet still law firm numbers hold relatively stable.

But we shouldn't be naive enough to think this will last, and I've been told by more than one analyst of hundreds of 'zombie' firms where managing partners are running their businesses into the ground before taking retirement.

What would stick in my throat if I ran a firm is the idea that I'm largely responsible for my plight. For a start, solicitors are routinely criticised for being bad at business. That may be so, but what do you expect from people trained as lawyers? I'd wager most doctors, journalists and other professionals wouldn't know their way around a budget sheet either.

And how can you run a business when there is no certainty? When constant government reforms to your sector mean the goalposts are not so much moved as extended across the pitch with the biggest brands in the country lining up to take a shot?

There was a wonderful irony at the Modern Law conference this week. One investor said law firms were unattractive prospects because they had no certainty over their future. Just hours earlier the justice minister Helen Grant announced that a decision that could make or break firms was being delayed. How can you have any certainty when the government appears uncertain itself?

It feels like the government is meddling - hesitantly - while Rome burns. Only law firms then get the blame when they struggle for breath.

John Hyde is a Gazette reporter

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SRA right to raid compensation fund - for now at least
John Hyde
Thursday, 25 April 2013

It all goes very quiet at the SRA board meetings when the subject of interventions comes up. Director Richard Collins updated the situation yesterday with the solemnity of a radio announcer reading out the names of kittens who have died that day.

In short, this year has been the game-changer the regulators have feared since the economy crashed. Now the banks have woken up to the uncertainty in the legal market, firms are starting to implode – with dire consequences for those firms with their heads still above water.

Law firms are no ordinary businesses. They’re keepers of valuable documents that can’t be thrown into a skip with the fax machine. The SRA has to do something to protect clients. The only question is what?

We all like to bash the SRA, but realistically it’s in a desperate position here.

The figures are stark: the SRA is expected to be saddled with £7m extra costs this year through interventions. This is not even the worst-case scenario – if a firm the size of Cobbetts needs help, we can expect that figure to double.

Clearly, doing nothing is not an option. Someone has to find new homes for live files and securely destroy those that have closed. There is room for reform here, with the regulator currently obliged to keep files for up to seven years even if, as in one recent case, they were already 20 years old.

One possibility is a one-off levy against firms to cover the 2013 deficit. On my rough calculations that would mean each firm paying roughly £700 towards helping the SRA clear up others’ mess. I can just imagine the reaction from practitioners about that.

And anyway, these kind of one-off levies are merely a sticking plaster. Collins himself predicted that 2014 looks like being no better for the legal profession, so would there need to be another cash call next year?

The SRA’s answer is to shift responsibility to the compensation fund, where there is room to manoeuvre and cover the excess costs. The change is subject to a six-week consultation period, but this has ‘done deal’ written all over it.

This may be the best option, but it feels instinctively wrong. The Compensation Fund is designed to protect clients, to pay them back when a dodgy solicitor has run off with their money.

Interventions are similarly intended to protect the consumer, but this will look to the public like law firms being bailed out with money allocated for their clients. Robbing Peter to pay Peter’s financially unstable solicitor, if you like.

As a short-term measure, we can hold our nose and let it through, but there are long-term questions to address. Should firms be compelled to reveal their financial troubles earlier, giving the SRA more scope for non-intervention action?

Will the SRA look again at the costs of intervention agents, which outweigh the costs of file archiving? It should be incumbent on the regulator to explain what value for money this arrangement is providing.

And ultimately, what sanctions are in place to make sure those responsible for a firm’s failure cannot escape with their pockets full? The first cash call in future must be on managing partners, not the compensation fund - and if they will not contribute to the costs of interventions, they should not be allowed to practise.

John Hyde is a Gazette reporter

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APIL can celebrate survival, if little else
John Hyde
Friday, 19 April 2013

Given that most of the planet has been wiped out by terrifying aliens, the film Independence Day ends on a remarkably happy note. President Bill Pullman rallies his troops and assures them the future is bright. You survived, he tells them, and that’s reason enough to celebrate. Now get digging those graves.

There’s been a similarly optimistic message coming from Celtic Manor this week, where the Association of Personal Injury Lawyers (APIL) has been holding its annual conference.

In fact, to see delegates last night, dressed in dinner jackets and ball gowns and dad-dancing to Blues Brothers tunes, you’d barely know the sector has had probably the most tumultuous year in its history.

Compared with last year, when attendees had their shoelaces and belts removed on entry, there has been an upbeat feel to #apil13. I swear I even saw someone smile last night, though he’ll probably lose that when he sees his bar bill on check-out.

Some of this will be the ‘head in sand’ brigade. Those who resolutely refuse to accept the effect of lower fixed fees and extensions to the claims portal. But there’s also an element to the conference of the relief that they survived 1 April. The world didn’t end; the aliens didn’t win.

Many have told me they are at pleased to have certainty about where they stand, even if the ground is shaky. Once the small-claims court limit is extended (although beware a further extension later this year) there can be no further kicks to the ribs.

It feels like the government has now moved on from attacking the PI sector to set its sights elsewhere, like those Independence Day invaders moving to a new city once they’d obliterated the previous one.

The optimism here may be genuine, but it would be wrong to say everything is rosy in the PI sector. For a start, those firms really struggling probably won’t be at the conference. I’m assured numbers attending this week have stayed the same as 2012, but it feels disingenuous to be talking about financial pressures in such grand surroundings as Celtic Manor.

And there is an acknowledgement that whilst there is calm on the surface, legs are furiously kicking beneath the water. Former president David Bott admitted there will be ‘carnage’ in the sector, and my only quibble with that would be that he should be using the present rather than the future tense.

My Twitter timeline certainly doesn’t reflect a content profession, with my followers either furious with the government or resigned to their fate.

The APIL conference has probably never been more parochial. I’m told national newspapers used to come down and cover the best bits – the press seats were conspicuously empty this time around.

There hasn’t been a single speaker from either the government or the Labour opposition. Last year then justice minister Jonathan Djanogly may not have showed up, but at least he sent a senior civil servant to read his speech.

I understand both Chris Grayling and Helen Grant were invited here this year, but were busy with other commitments.

The truth is this conference will make no ripples with the powers-that-be at Westminster. I’d be surprised if they even knew it was happening. When the ABI held its conference last month, they had the transport secretary, chair of the transport select committee and a former justice secretary – they have the ear of government and the claimants don’t.

Newport has been little more than a talking shop: preaching to the converted but failing to convert either the public or the political elite. But then perhaps that’s what the members needed this year – 2013 has been about laying foundations, not lobbying.

The fears and the threats are the same as when APIL members arrived in Wales, but they will at least leave with some of the joys of spring.

John Hyde is a Gazette reporter

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Insurers use referral fee ban to feather their own nests
John Hyde
Friday, 5 April 2013

Readers will remember that former justice minister Jonathan Djanogly was required to begin many public appearances by declaring an interest (‘possibly’) in the insurance sector.

Djanogly will probably be best remembered for his ban on referral fees. This included his attempt to ride roughshod over the misgivings of the Legal Services Board, which saw no reason for a ban, and remove this ‘parasitic’ drain on our car insurance premiums. (It was not, of course, a hasty move designed to usurp Jack Straw’s similar attempt). Perhaps Djanogly’s heart was in the right place. Perhaps he meant well and thought he was genuinely cleaning up the industry and leaving a positive legacy.

However, in reality the ban has simply opened the door for insurance companies to hide the profits they make from referrals and keep this merry-go-round turning as quickly as ever. The reason? The alternative business structure - a Trojan horse entering the legal profession behind which any organisation is entitled to enter the market.

Ban supporters spoke of unintended consequences from ABSs like they were a worse-case scenario. Sure, there may be some who played the system and engineered profits from exchanging accident victims’ details, but they’d be the exception. Djanogly himself, seemingly not aware of this, told the transport select committee in 2011: ‘The idea that insurance companies are going to benefit from what we are doing is certainly not the case for all insurance companies and I would say not necessarily the case for most.’

Yet within a week of the ban that prediction has proven to be utterly misguided. Two of the biggest car insurers in the UK, Admiral and Ageas, responded to it by setting up joint ventures with law firms.

In effect, they have put up the shutters and taken the profits they make from selling their customers’ details in-house. Referral fees? Not at all officer, we simply point our loyal flock on to a trusted legal brand which happens to be inextricably linked to us. Nothing to see here.

What they are doing is completely lawful: the terms of the referral fee ban are quite clear – there is no breach if information is kept within the one building. So long as insurance companies and their law firm partners act as one entity, they won’t be getting a knock at the door from the Solicitors Regulation Authority anytime soon.

Lawful, yes. But in keeping with the spirit of the ban? Not a chance. Motorists will still get the call within days – even hours – of suffering an accident. They will still be encouraged to make a claim against the at-fault driver.

Admiral will continue to profit from personal injury claims on the one hand and fight them on the other. The system remains dysfunctional, only now it’s just that little bit less transparent. According to Admiral’s financial results for 2012, the firm was forced to admit it earned £18.6m from referral fees last year – now the lines are more blurred, we probably won’t know what profits it delivers in 2013.

Back in 2011, Djanogly was optimistic: ‘We want the benefit of [the ban] to feed through to the consumer in lower insurance premiums.’ How ridiculous that notion looks now as insurance companies once again get stronger thanks to this government’s ill-thought-out reform agenda.

John Hyde is a Gazette reporter

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Police deserve fair play, too
John Hyde
Wednesday, 3 April 2013

Since when did making a claim amount to an agreed settlement?

I ask because we appear to have slipped into a world where the outcome of claims no longer matters to our national media. Take the case of PC Kelly Jones (take note, editors, she is not a WPC), a Norfolk officer who has reportedly started legal proceedings against a garage owner after she fell while investigating a burglary. The level of vitriol directed at PC Jones, given that we have yet to hear the full facts, has been staggering.

Former Met Police chief superintendent Dai Davies said she ‘looks like she regards the gym as an entirely alien environment’, while Richard Littlejohn (who knows a thing or two about devastating character assassinations) kindly suggested she was ‘visibly overweight with unkempt hair, she looks less like a policewoman and more like one of those ferocious female members of the ‘travelling community’’.

She was said in one article to be ‘in hiding’ at her parents’ home (roughly translated as ‘visiting relatives over Easter’).

I don’t know whether her claim will succeed, but given PC Jones is currently on sick leave with an unrelated medical condition so serious she needs an operation, perhaps jibes about her appearance are unwise. What strikes me as odd in the coverage is that everyone misses the obvious point: if PC Jones is on the take, then why not contest the claim?

From the coverage you would think this woman simply had to file a claim to pocket £50k, but there is the small matter of legal process to go through first. Instead, the defendant used the media to highlight this case and presumably hopes to bully PC Jones into withdrawing it. The danger of the media misreporting personal injury claims to suit a ‘health and safety gone mad’ agenda was highlighted in Lord Dyson’s marvelous deconstruction of the compensation culture myth last month.

You remember the McDonald’s coffee claim? That daft woman who couldn’t work out that a hot beverage might be, well, hot - and drove away with it between her legs?

Turns out the woman in question was a passenger in a stationary car when the coffee, heated to 190 degrees, spilt and soaked through her trousers to give her third-degree burns. She was in hospital for eight days, had to undergo skin grafts and was partially disabled for two years. McDonalds had been subject to 700 claims in 10 years arising from coffee burns. Still, not as funny as ‘cash bonanza for coffee slapstick’ is it?

There appears to be an assumption in much of the coverage that says police should never be allowed to make a claim for personal injury suffered whilst on duty. The redoubtable ‘proper copper’ Davies, who appears to have been transported straight from the set of Life on Mars, insists he would have regarded compensation for his various injuries as ‘laughable’. I wonder how hard he would have laughed if his house needed modifying to cope with a disability, or he needed costly round-the-clock care?

The police are entitled to the same duty of care from owner/occupiers as afforded to the rest of us. They’re public servants, not martyrs. And if they don’t make a claim, it doesn’t mean their injuries magically vanish: just that we, the taxpayer, end up paying their bill.

John Hyde is a Gazette reporter

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This judgment is sponsored by Budweiser
John Hyde
Thursday, 28 March 2013

There are always two clues for the eagle-eyed journalist that an announcement is going to cause trouble.

The first is the announcement itself: the less detail, the more controversial it’s likely to turn out. It’s like the Titanic captain telling passengers the ship is suffering a little turbulence and they should go back to bed. The second is the reaction. Unless it’s full-blown fanfares and ringing endorsements, you know the people that matter hate the idea.

Take Chris Grayling’s announcement this week about making more money from the courts service.

For a start it was made on the final day before the Easter parliamentary recess. This inevitably brings to mind a fare dodger heading to the back of the train to avoid the ticket collector. Then the lack of detail was staggering, with Grayling hinting at making greater revenues from international litigation and ensuring that those who litigate ‘pay their fair share’.

The response from the judiciary was drenched in between-the-lines scepticism, with the lord chief justice noting that he ‘recognises the wisdom of exploring ways to achieve funding arrangements which are consistent with the independence of the judiciary, the responsibility of the state to provide access to justice and the need for appropriate accountability’. Perhaps a simple ‘don’t even think about it’ would have sufficed.

My fear is that Grayling is being too modest in his attempts to wring every penny out of our courts system.

The most obvious ways of filling the black hole are to raise fees. Let billionaire Russian oligarchs cough up a bit more if they want to use our courts like a playground. If English courts really are the envy of the world, as we are constantly told, we should charge premium rates for them.

But why stop there? Why not add revenue streams to our courts? You want to take a comfort break during proceedings? It’ll cost you. Those wooden seats a little uncomfortable after a few hours? We’ll rent you a cushion – for a price.

SkyBet memorably told us that sport matters more when there’s money on it – so let’s get the bookies involved in trials. We’ll have odds on the verdict and spread betting on how long the jury will be out for. Of course, you’ll want to maximise advertising revenues. ‘This judgment, as sponsored by Budweiser’ has a nice ring to it. We could see branded water on each bench, advocates’ gowns backed by BT (it is good to talk, after all) and we can have sponsors’ logos on judicial wigs (though perhaps supermarkets might shy away from links with horse hair).

In fact, once the TV cameras are inside courtrooms, the floodgates can really open. The foreman of the jury can go to an ad break, in the style of Chris Tarrant, before giving his final answer. Maybe sentences could be cut for prisoners who consent to product endorsement: ‘In mitigation I just can’t get enough of that sweet Coke taste’ will be worth at least a quarter off.

Court naming rights are an open goal: the Old (Spice) Bailey, the McDonalds Magistrates’ Court. The Ryanair Royal Courts of Justice.

Lord chancellor, this truly is your chance to stamp your indelible mark on the legal profession. Given the right measures we’ll have our courts turning a profit in no time.

John Hyde is a Gazette reporter

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Budget fallout: running into a brick wall
John Hyde
Friday, 22 March 2013

Watching the fallout from every budget is like being transported into the Truman Show.

Everyone says the same thing, moves in the same direction and ends up just where they started. Perhaps George Osborne’s tortured economic recovery will end, like Truman, running into a brick wall with a fake sunset on the horizon.

It’s just all so predictable, and not just because the Evening Standard told us what would be in it. Osborne revises previous forecasts like they never happened, Balls calls for a U-turn with all the predictability of a DVD menu display stuck on a loop when you’ve lost the remote control.

The ‘penny off a pint’ was classic political counterfugue. To claim your ‘free’ pint at, say, £3 a pint, you’ll have to drink 300 pints. After that quite frankly you’ll deserve a lie down, not a another drink.

All the while so many of the details get overlooked – and nowhere is this more prevalent than for the Ministry of Justice.

Despite the enormous benefits of our legal system to the taxpayer – put at more than £20bn by justice secretary Chris Grayling last week – his department has to get it in the neck with every budget announcement.

Like other non-ringfenced departments, the MoJ will lose another 2% from the budget by 2015 – a cool £142m in total.

Now, compared with the £2bn guillotined from the justice fund since 2010, it’s a drop in the ocean, but it will have to come from somewhere.

Don’t tell the pitchfork brigade, but the government has already cut costs through reducing prison numbers. Last week there were 84,501 people locked up compared with 87,870 a year ago.

As was pointed out in justice questions in the Commons this week, 3,359 cautions were given for burglary in 2011 (the last recorded year) – perhaps a hint that budgetary pressures are affecting punishment decisions.

The MoJ has already cut staff numbers significantly. According to the 2011/12 accounts, there were at least 4,000 fewer MoJ employees last April than a year before. Departmental efficiency savings, the rather vague all-encompassing miracle cure for cost-cutting, is surely exhausted.

Desperation to reduce outgoings has already led to the fiasco of the court interpreters’ contract, which is supposed to deliver £50m savings every year but which has seen nothing but trouble since its inception in February 2012.

The only remaining option for the MoJ – and perhaps the most unpalatable for the legal profession – is simply an extension of existing coalition policy: court closures and legal aid cuts.

The 142 court closures first announced in 2010 are mooted to save around £37m a year - and I’ve heard from a couple of sources that more closures may be an option.

And of course there is the issue of price-competitive tendering for providers offering defence services from 2014. Would that eat into the £142m? It’s difficult to know without someone actually explaining what the proposal would save.

However they choose to cut their cloth, there’s every chance it will affect us all in some way, yet we seem oblivious to it.

Perhaps, like Truman Burbank, we’ll awaken ourselves and escape this horror show. Or perhaps we’ll simply drink ourselves into oblivion holding out for that free beer.

John Hyde is a Gazette reporter

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Financial crisis will cost everyone in the end
John Hyde
Thursday, 14 March 2013

Journalists are far too willing to bandy the term ‘crisis’ around, using it to label everything from a few cancelled trains to an Arsenal defeat. But how else to describe the impending financial troubles about to hit the legal profession?

I say profession quite deliberately. So far you may have run your firm in profit: you may have adapted for the changes to personal injury and legal aid; you may have avoided signing sky-high tenancy agreements at the height of the boom; you may have seen off the increased competition from new entrants to the market.

But even if you’re one of the good guys – especially if you’re one of the good guys – the fallout from the collapse of law firms will ultimately hit your pocket.

Make no mistake: Cobbetts, Atteys and Blakemores are the tip of the iceberg. According to the SRA, the regulator is supervising 56 firms that are in danger of intervention, mostly due to financial difficulties. Intervention means they cannot be allowed to hold client files anymore and there is little chance that another firm will come forward to buy them (Cobbetts was bought by DWF, but there was no intervention).

The cost to the profession is staggering. In the first three months of this year, the SRA has spent £2.2m in securing live and active files of failed firms. To put that figure into context, in the whole of 2012, the total cost of the 37 required interventions was £1.16m.

To intervene at Yorkshire firm Atteys, an average-sized firm of 140 staff, cost an estimated £1m. If just half of the at-risk firms meet the same fate, the SRA could have spent its entire annual budget on interventions.

The regulator has limited options. It can plead with struggling firms to lift their heads out of the sand and put ‘rainy day’ money aside to negate the cost of intervention. But if they’re already struggling, this is hardly likely to appeal.

The SRA can, and should, look again at its intervention policy. Is it really necessary to intervene in every case and if so, why are the costs so high? Could dead files not be destroyed earlier, for example?

It is interesting to note that intervention services are outsourced to Capita, and the profession deserves to know what value for money this arrangement is delivering.

At present the cost is borne by administration budgets, but there is a very real chance that it could be passed on to the compensation fund – which is, of course, funded by solicitors and their firms. We then risk creating a vicious circle where firms that are solvent are placed under financial strain covering for other firms that have already gone bust.

The SRA is going to be swamped in the coming months as the reality of mixing a regulated profession with the brutality of business comes home to roost.

Even if your firm survives, it’s ultimately going to cost you.

John Hyde is a Gazette reporter

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Why is government so keen to kill the PI sector?
John Hyde
Friday, 8 March 2013

When the Ford Transit plant in Southampton was at risk of closure last year, with 500 jobs under threat, David Cameron’s government offered a £10m grant.

Yet when it comes to the personal injury sector, Cameron has not just stood aside and let it happen, he’s handed the grim reaper his scythe and told him to hack away.

Make no mistake, the government is going to be responsible for the loss of thousands of jobs.

This week I have been inundated with emails and calls from law firms with horror stories of mass redundancies and decimated offices. I’ve had one solicitor in tears asking what exactly they had done to deserve such swift retribution.

Virtually every firm has told me their headcounts will at least halve. Law Society chief executive Desmond Hudson estimated that 20,000 solicitors are involved in PI: at a rough guess, that’s 10,000 solicitor posts gone, almost overnight.

And it’s not just solicitors – who are unlikely to elicit much public sympathy – but secretaries, receptionists and cleaners. It’s the sandwich shop across the road, the childminder looking after children while parents work, the barman serving them at the office party. It’s an entire network of small businesses and hardworking people who will be adversely affected.

And for what? It seems to me we all – government, lawyers, mouthy journalists – want the same three things: fewer of those terrible daytime TV ads, reduced car premiums and a fair crack of the whip for injury victims. None of these ambitions will be realised.

The claims culture will thrive – maybe even grow – once solicitors are ejected from the club. Claims management companies will simply pick up the slack, do the work on the cheap and churn out cases without any regard for those involved. Your daily dose of Jeremy Kyle will have more PI adverts than ever.

Reduced car insurance premiums? Don’t make me laugh. Even the insurers themselves admit that premiums might – might! – come down by a mere 3%. Let’s say you have a £500 annual premium, that saves you £1.25 a month. Just don’t spend it all at once folks.

As to the third, I agree the claimants’ argument about access to justice looks spurious. The insurers (pot, kettle, black, etc) are right to say this is about self-interest as much as public good. But that doesn’t hide the fact that unrepresented victims are less likely to get what they deserve, never mind clog up the small-claims court with no idea how to advance their claim.

The whiplash consultation on the small-claims limit closes today. I hope you contributed, although I would be amazed if it made even the smallest difference to government policy.

The PI market was bloated. There were lawyers and firms who did the profession no favours. There is clearly scope for contraction of the market – just not so devastatingly quickly.

Justice secretary Chris Grayling may well be glad he escaped the Department for Work and Pensions when he did – his old colleagues are going to have their work cut out very soon.

John Hyde is a Gazette reporter

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