A government proposal to ban ‘claims farmers’ from offering cash inducements and other benefits to the public has been put on hold, the Ministry of Justice confirmed this week.

Responding to its consultation on the proposed ban, which was triggered by Lord Young of Graffham’s report on the ‘compensation culture’ last year, the MoJ said that the proposal ‘and other issues’ will be examined as part of a general review of claims management rules later this year.

It said the changes will be reviewed by the government’s Regulatory Policy Committee and the Reducing Regulation Committee before implementation is reconsidered.

Rules state that claims management companies and law firms cannot offer immediate cash payments or similar benefits as inducements to make a claim, but they can offer inducements to be paid after claims are approved.

Young said in his report that offering inducements to potential claimants is a high-pressure marketing technique.

Some 39 bodies responded to the consultation, with a majority supporting the proposed amendment.