Efforts to control the costs of defamation actions will step up this autumn with the launch of a year-long costs budgeting pilot.

Under the scheme at the Royal Courts of Justice and High Court in Manchester, parties will be required to discuss with each other and then submit to the court detailed estimates of future base costs.

The pilot aims to ensure costs are proportionate to the value of the claim and the reputational issues at stake.

In a separate move, rules on what the claimant has to tell the defendant about its after-the-event (ATE) insurance policy are being beefed up. In publication proceedings, if defendants admit liability and offer to settle within 42 days of receiving ATE information, they will not have to pay the premium if the matter settles before issue. 

Alasdair Pepper, a partner at London media firm Carter-Ruck, said: ‘I hope [the pilot] is a step in the right direction. We are all for strong case management by judges and that must include the costs.’ It would help to agree the ground rules, such as whether it is appropriate to use a QC, as early as possible, he explained.

Pepper said he supported the idea of a nil-premium window – ‘with the proviso that it doesn’t drive ATE insurers from the market’ – but thought 42 days too long as ‘it means papers can string things out’.