NHS Redress Bill [HL]

My Lords, on behalf of all my noble friends on these Benches, I should like to thank the Minister for having introduced the Bill with his customary clarity. It is a Bill which, let me be the first to say, springs from a diagnosis with which very few would take issue. There is surely no doubt that the system which we have at present for dealing with clinical negligence claims against the NHS is fraught with shortcomings. It is slow and it is expensive. Typically, a claim, from the moment it is initiated, takes a very long time, often several years, to reach an outcome. Not infrequently the legal and administrative costs of settling a claim exceed the money actually paid to the claimant. In the last financial year, legal costs accounted for over a quarter of all the money paid out in clinical negligence cases. On top of that, the system is widely viewed as being unfair. The main unfairness is that it is only the 10 per cent of the population who are eligible for legal aid, and the very rich, who have access to justice. For many people there is no justice at all because the cost and complexity of making a negligence claim deters them from ever beginning, even though the grievance may be perfectly legitimate. What the Minister did not say, but which he could certainly have added, is that a high proportion of the cases that are taken forward are artificially fuelled by the legal aid system, which creates perverse incentives to lawyers to take on cases regardless of merit and then to drag them out. For claimants on legal aid there is no downside because even if they lose, costs cannot be awarded against them. By exactly the same token, the NHS is in a no-win situation. Even if it successfully defends a case, the costs of doing so are irrecoverable if the claimant is legally aided; and that often means that it is cheaper to settle a case out of court than to contest it, even though the claim may lack any obvious merit. The need to reform the system is plain and the Government are to be congratulated on having the political will to try to get to grips with it. I particularly agree with the Minister that more often than not what the aggrieved patient wants is an explanation and an apology for what went wrong. But all too often he gets neither. For the majority of people, making a complaint is not about the money, it is about getting those responsible for a clinical error to acknowledge what went wrong and gaining some reassurance that lessons have been learnt and that the same thing will not happen to someone else. It seems to me that if any sort of new and improved claims system is to be counted a success it is these things, above all, which it must deliver. The Minister helpfully charted the journey the Government have made since the commitment in their 2001 manifesto to reform the system. The fact that this journey has been, to put it kindly, something of a rocky road is one which, perhaps understandably, he glossed over. The great cry in the CMO’s document Making Amends was the need, as he saw it, to move away from a strictly tort-based system. Now, though, as we read Clause 1 of the Bill, what do we see staring us in the face? There is the phrase ““qualifying liability in tort””, defining what will constitute a valid claim under the proposed scheme. It looked for a long time as if the Government were going to place a good deal of emphasis on conditional fee agreements as a way of ensuring that only claims with a real chance of success would be taken forward, and spurious claims weeded out. Then, after a great deal of cogitation, we heard from Mr. Lammy last March that the Government’s proposals would not, after all, include the idea of conditional fee agreements. There were, I believe, 19 recommendations in Making Amends. This Bill embodies the response only to the first of those. Of the rest, the major recommendation—for a no-fault scheme for birth injuries sustained by babies—has, we understand, been dropped and the remaining 17 quietly shelved. So, high marks to the Government for good intentions; but we need to recognise that the Bill before us is not quite the groundbreaker that many of us once believed it would be. The objective of the Bill is certainly laudable. It is to create a scheme for speedy, efficient and appropriate redress for patients of the NHS who have suffered harm arising from negligence during the course of their treatment. It is designed to deal with claims of harm at the less serious end of the spectrum, and we know that these currently comprise about 70 per cent of the claims made each year. The great advantage is that the scheme is intended to be an alternative to the complex and expensive process of civil litigation. I do not think anyone would dispute that these are all good and worthy aims. What we need to decide, however, is whether the Bill achieves those aims successfully. It is a skeleton Bill. Much of the detail will be the subject of regulations. It is a great pity that we have no draft of the regulations before us that we can consider; but, because we do not, it is a fair bet to say that we shall need to table a goodly number of probing amendments in Committee to try to put some flesh on the bones. There are, however, things that we can surely say in advance of that stage. We hear that it is the Government’s intention to give the NHS Litigation Authority the responsibility of running the new scheme. That means that an organisation which—with no disrespect to the excellent people in it—is very much in-house in relation to the NHS is being asked to take charge of the claims process from start to finish. It is being asked to determine the facts underlying the claim; to decide whether there has been an error; to assess the seriousness of any such error and give an explanation of what happened; to determine whether the error constitutes a qualifying liability in tort; and, if it finds that it does, to put a value on the compensation to be offered to the patient. The NHS, in other words, is being required to find fault against itself as judge and jury of its own performance. I believe that that inherent conflict of interest represents a serious flaw in the scheme. What we essentially have here is a trade-off. The trade-off is between speed, simplicity and ease of handling and natural justice. I do not believe that that trade-off will command confidence. However diligently the NHSLA does its job, the patient will never be able to have certainty that bias is absent or that he has not, ultimately, been short-changed. The one feature of civil litigation which is surely positive is that it is an independent process. The same really cannot be said of the scheme before us. It will lack credibility. Then there is the cost. We see on page 13 of the regulatory impact assessment that:"““The Redress Scheme may increase spending on compensation payments because it will improve access to justice and thus bring new claims into the system . . . The vast majority of opportunistic claims will be easily rejected””." I do not know what basis the Government can possibly have for making that last statement. In clinical negligence litigation the success rates are modest. Vast sums of public money can be spent before cases are abandoned. All the experience to date shows that spurious claims are not easily rejected. Indeed, in litigation, nuisance claims are often compensated where the claimant has no risk because it is more expensive to contest the claim than it is to settle. Exactly the same thing is likely to happen here. The redress scheme provides a free ticket for a compensation claim, with no disincentive whatever for claims that are opportunistic. We are assured by the Government that the scheme will represent a departure from the adversarial tort-based culture of the courts. Frankly, I do not see that. Where you say to a claimant that he is entitled to free legal assistance to help pursue his claim with the NHS, it is hard to see how this will not replicate the adversarial culture with which we are already so familiar and which Making Amends explicitly sought to avoid. But what is particularly unfortunate, in my view, is that the proposals before us focus so strongly on monetary compensation. The essence of Making Amends was that redress should first and foremost be about fact-finding, explanation and apology. In the majority of cases, as we know from patient surveys, that is all that the patient wants. By putting the emphasis on compensation, the proposals in the Bill force us to move those ideas away from centre stage. I think that that is an error. If I had to summarise what I felt about the Bill I would say that it was a wasted opportunity. With a little more finesse, the Government could have created a scheme that did all the things that everyone wants and which the scheme before us patently does not. In Committee, I shall be setting out an alternative model. The essence of that model is to separate the process of fact-finding from the process of determining liability. The process of fact-finding should be carried out by a body independent of the NHS—perhaps the Healthcare Commission—at the end of which would emerge an explanation, recommendations on lessons learnt and, where appropriate, an apology. The fact-finding exercise may or may not give rise to a qualifying liability in tort. Determining whether it does or does not should not be a function of the NHS. Whether a patient wishes to pursue the compensation route, having received an apology and explanation, will be up to him. But investigating fault and determining damages should be entirely outside the scope of the redress scheme. Those things can be pursued by negotiation, specialist mediation or by a fixed costs arrangement. I freely concede that a two-stage model such as this is likely to lengthen the time before compensation is obtained. But it is less likely to short-change the claimant; it is less likely to compensate unworthy claims; it will be independent; and, above all, it will meet patient expectations. The scene is set for some interesting debates in Committee, to which I look forward. I could have wished to conclude my remarks by congratulating the Government on a piece of work well done. That I cannot do so is a matter of sincere regret, as I do not doubt that the Minister’s heart is in the right place. But if noble Lords are minded to agree with me that these proposals are not well thought through, there may be a chance of persuading the Minister that improvements to the Bill can usefully be made. I very much hope so.