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Coalition; What Coalition?

13/05/2015

Will we ever trust the pollsters again? After what was billed for weeks, if not months, as the election that was just too tight to call with predictions of a hung parliament, the Conservatives produce a majority victory and form the new Government.

In what was in many respects a “game changer” night for UK politics, the electorate defied all the polls and delivered a majority (albeit a very small one) for the Conservatives and also a resounding victory for the SNP in Scotland. Labour and the Lib Dems had a night to forget and will undoubtedly be back to the drawing board in terms of leadership, tone and strategy.

The Conservative majority is a very narrow one. Once the gloss wears off and the honeymoon period ends, David Cameron will face an emboldened back bench and will have to work hard to keep his party united, especially in the context of an EU referendum in 2017 (historically the issue of the EU has at best been a distraction to Conservative Governments and on occasion has actually de-railed them!). Otherwise, it is likely that we can expect more of the same. Unfettered by the constraints of a coalition, the Conservatives can press forwards with their manifesto agenda. The other parties will also be deflected by navel gazing and leadership in-fighting giving, for a little time at least, the Government an easier ride than may be usually expected.

So what does this mean for us? Well let’s start with our new Secretary of State for Justice – Michael Gove MP. Another non-lawyer in the post following Chris Grayling, a man with a reputation as a fearless reformer and close ally of the Prime Minister. His appointment was to a large extent a surprise but just underlines the Prime Minister’s determination to pursue significant and challenging legal change in this Parliament. Mr. Gove’s reforming zeal will be well utilised in endeavouring to repeal the Human Rights Act, overseeing English Votes for English Laws and continuing the Government’s reforms to criminal and civil justice.

We can expect him to bring a modernising outlook to the Ministry of Justice, in contrast to Grayling whose interventionist and centralising instincts were so very unpopular with the legal profession. His biggest challenge however, will be repealing the Human Rights Act and replacing it with a British Bill of Rights.

And closer to home, what may lie ahead in terms of personal injury compensation? Will this feature in Michael Gove’s agenda and if so, how?

The Government intervened in personal injury compensation in 2011 following the excellent work of Lord Justice Jackson. To summarise, they wanted to deliver a more effective and efficient compensation process which would in turn reduce the number and cost of lower value personal injury claims and reduce the burden on (and the cost of) the courts. Whilst much good work was done, the number of portal RTA claims continues to rise as does their cost. This may, in 2015, lead to increasing premiums which will hit already hard-pressed motorists.

The failure to address RTA claims frequency therefore means a job left unfinished for Government and gives the potential to cut across their over-arching “cost of living” policy drive to cut waste and cost and ease the burden on the public. For these reasons, our sense is that personal injury compensation as a policy area will not go away. We would not be at all surprised to see the MoJ re-visit this issue within the life of this Parliament.

Various options may be available to the MoJ to try once again to address RTA frequency. The two popular themes advanced by compensators are moving to a system of “care not cash” or pressing for an increase in the Small Claims Track (SCT). Again, our sense is that the latter is more likely than the former. Notwithstanding Mr Gove’s appetite for reform, a more incremental approach by way of the SCT feels a more proportionate MoJ response. Keoghs have long cautioned against a banner headline lobbying position of “increase the SCT”. For any increase to work and for us not to fall into the trap of the last five years of unintended consequences, any increase would, in our view, need to be introduced within a package of interlocking measures. These would include tariff damages, a regulated code of conduct for compensators and a revision of the Damages Based Agreement regulations. This latter point is particularly important so as not to re-ignite the claims management industry just as PPI claims start to diminish.

Readers will recall that both the MoJ and the Transport Select Committee have already consulted on the issue of an SCT increase. Both said that there were strong arguments for an uplift but that time was needed to see whether the Jackson / LASPO reforms would deliver. Arguably, that time has now expired. Time will tell whether the MoJ will intervene further but for now, Keoghs continues to engage Government on these important issues for clients.

Finally, many will be aware of our long standing campaign on “young driver safety”. We have spent the last three years speaking out on this issue including at Party Conferences and at Westminster events alongside clients. More recently we have partnered with the charity RoSPA to support their campaign for young driver safety, which is being covered on BBC Breakfast news this week. As part of this, the RoSPA / Keoghs YouGov survey on young driver safety is scheduled to be discussed. We are keen to highlight this important issue quickly to the new Government and seek a Green Paper to consult on reform. All support is very welcome indeed.

Author

Steve Thomas

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