The House of Commons justice committee has announced that MPs will scrutinise the government’s plans for personal injury reform.
The committee looked at the issue of the small claims limit earlier this year but its inquiry was halted by the general election and dissolution of parliament.
Now MPs will take a fresh look at the plans to increase the small claims limit from £1,000 to £5,000 for RTA-related whiplash claims, and £2,000 for other personal injury claims. The reforms would require secondary legislation but are likely to be implemented after the government legislates for a tariff system for whiplash, a measure in the Civil Liability Bill currently waiting to be published.
The small claims limit changes would effectively take lawyers out of the equation for these claims – except if claimants are prepared to pay for representation themselves – and could have a significant impact on firms specialising in low-value claims.
The committee says it will focus on the impact of the increase, taking account of the planned move towards online court procedures.
The potential impact of the policy on the role of claims management companies and on the operation of the market for before-the-event insurance will also be examined.
The news will be welcomed by campaigners trying to stop the government pushing ahead with reform. The justice committee has gained a reputation for holding ministers to account and being critical at times – not least last week when MPs queried the evidence basis for reform of the discount rate.
Lobbyists for the claimant sector will hope their campaign will gain traction from any negative evidence put forward, although lord chancellor David Lidington has been resolute that the limit will rise.
The committee will accept written submissions until 22 December and will hold a one-off evidence session early in the New Year before publishing a report.