We have a system of small claims—by and large, these are very straightforward claims. We want to ensure that support is there so that people are able to bring the claims in person. As I have said, these are simple claims and it is right that we also take action to address some of the concerns that we have. I shall set out more detail in my remarks, but I believe that we have the balance right in terms of the increase to £5,000.
The Bill provides that the tariff will be set in regulations to be debated via the affirmative procedure by Parliament following Royal Assent. We are committed to tabling an amendment in Committee that will require the Lord Chancellor to consult with the Lord Chief Justice before making those regulations. The judiciary will have discretion to increase the compensation payable in exceptional
circumstances and, after listening to the views in the other place, we have amended the Bill to ensure that overall compensation levels in the tariff are reviewed at least every three years. We listened carefully to the comments made by the Delegated Powers and Regulatory Reform Committee in the Lords. We accepted its recommendation and tabled an amendment to include a full definition of whiplash injury in the Bill in order to remove any ambiguity about what that constitutes in law.
The Government’s reform programme also includes measures—not included in the scope of this Bill—to increase the small claims track limit for road traffic accident personal injury claims to £5,000, and for all other personal injury claims to £2,000. As these claims are generally not complicated, they are suitable to be managed in the simpler, lower cost small claims track. This route is designed to be accessible to litigants in person without the need for a lawyer, although claimants may still seek legal representation if they wish. To support this, the Government are working with a wide stakeholder group including the insurance industry, claimant solicitor representative groups and consumer groups in order to design and deliver a simple-to-use online service to enable the vast majority of those claiming for low-value road traffic accidents who may well choose not to be represented by legal advisers to receive help and guidance to manage their cases through to conclusion.
The service will be designed for those with no legal advice or training, and will be as simple to use as possible to ensure that the claimant journey is as smooth as it can be. Raising the small claims limit for these RTA cases to £5,000 will work to control their costs, acting as an incentive for insurers to challenge, rather than settle, those cases that they believe to be without merit. This is vital to changing the unhealthy culture that sees whiplash claims as a way to make easy cash. The reality is that, as insurers are forced to offset the cost of the abuse by raising premiums, fraudsters are simply taking money out of the pockets of honest motorists.