With the country still reeling from the shock of Friday’s result, the insurance industry must be wondering: what will become of the Government’s planned reforms to whiplash and the small claims track limit?
These reforms were announced in the Autumn Statement 2015 by the Chancellor and endorsed by the Prime Minister. So although responsibility for progressing these reforms sits with The Ministry of Justice, they emanated from No 10 and No 11.
We are speeding towards summer recess – Parliament rises on 21 July. The consultation has been repeatedly delayed, more recently due to the local election and referendum purdah periods. It’s reasonable to assume that the consultation has long been ready to publish. The real question is: who’s going to press the button?
We know that Cameron intends to leave No 10 before the Conservative party conference in October. And it was only a few months ago that Osborne was seen as a likely successor to Cameron; this now looks very unlikely.* The response to his recent budget combined with accusations of financial scare mongering in the run-up to the referendum (particularly after the announcement of a possible “Brexit emergency budget”) will likely be fatal to his leadership prospects.
So where does that leave the reforms? There is no easy answer at this stage – in his resignation speech on Friday morning, Cameron confirmed that he and the Cabinet will be “taking forward the important legislation that we set before Parliament in the Queen's Speech.” Any references to justice reform relate to a British Bill of Rights and criminal justice only.
However, these reforms fit into the Conservative Government’s cost of living agenda. Ultimately, the urgency with which the whiplash reforms are taken forward may depend upon the importance placed on this agenda by the next Conservative leader. It’ll also depend upon the circumstances that motivate this person’s next steps - this may hinge upon the proximity of another general election. And what of the Ministry of Justice and Michael Gove? It seems unlikely that Gove will retain the Justice brief – who will take his place?
But that is not the only moving part – will we even have a Conservative Government in 6 months’ time? The next Tory leader may wish to seek his or her own mandate from the British electorate – many commentators are speaking of a possible general election this autumn. However, with the Labour party in disarray and in the absence of a strong Labour leader, it is difficult to imagine colours changing from blue to red at this stage.
The timing of the article 50 trigger will also play a part – legislation to extricate ourselves from the EU will no doubt dominate parliamentary time. Estimates suggest that Parliament may need to pass 70 Bills as part of the Brexit process. And all this will take place in a pressure cooker; the article 50 trigger sets the two year clock ticking. Other legislation will need to be slotted in between this, if possible.
However, not everything is a complete unknown. Lord Faulks, the minister in charge of these reforms, is unlikely to move post. By virtue of his peerage, Faulks is somewhat insulated from the political in-fighting. And because whiplash reform falls under his remit, it is – assuming we continue with a Conservative Government and that he follows through on his own promises of implementation - unlikely to completely fall by the wayside.
*George Osborne confirmed on 28 June that he will not be running for leadership of the Conservative party.
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