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800,000 members of the public per annum aren't sick of hearing about whiplash. If you add in their spouses, parents etc that's a lot of voters the government are playing fast and loose with. Perhaps though they'll be happy with "proportionate compensation", which is the new euphemism for "a lot less than judges consider appropriate".
Furthermore, I wonder if the MoJ's belief that "claims under £5,000 will be minor and straightforward enough not to require a lawyer" has come from the ABI like the rest of their dogma. We'll soon see if the insurers agree with that in practice by not instructing solicitors to represent them in the SCT.