Justice secretary Chris Grayling has said the proposed new small-claims court limit of £5,000 may be ‘too low’ – despite the ongoing consultation on raising the figure from £1,000.
Grayling (pictured) told parliament on Tuesday that raising the small-claims limit to £5,000 would mean accident victims continue to have access to justice.
He hinted that, although a consultation on the £5,000 limit is running until 8 March, the government is considering raising it further. ‘I think there is a case for saying that the small-claims court limit of £5,000 is too low,’ he said.
‘I am keen for people to have access to a proper legal process, but the benefit of the small-claims court is, in part, arbitration. The plans make the process simpler and cleaner for people who have been through a difficult time.’
Critics have already warned that existing plans could create a new unregulated industry to handle claims below £5,000 and lead to courts handling increased numbers of litigants in person.
Last week, the Daily Telegraph reported that the small-claims limit could be lifted to as much as £15,000 for personal injury cases. It said the move was a response to a claimant lawyers’ group starting a judicial review to examine how Grayling decided to reduce fixed costs for claims portal work.
A spokesman for the Ministry of Justice said: ‘These changes, along with our wider reforms, are intended to bring more balance to the system, make lawyers' costs proportionate and in turn create an environment where insurers can pass on savings to their customers through lower premiums.
‘Following recent legal challenges the justice secretary is examining all options.’
A spokesman for the Association of Personal Injury Lawyers, one of the groups behind the legal challenge, said: ‘It’s very hard to believe that the justice secretary would react in such an irrational and indiscriminate way to a legitimate legal challenge.
‘We obviously hope that it turns out to be without foundation.’