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Small Claims (Courts)

: I cannot give an actual date, but I can say that the review is progressing with the appropriate speed. We are considering the matter and are talking to people about it. It is not that nothing is happening about the subject. It is not just sitting gathering dust on a shelf. We are actually looking into the matter. A lot of people are still making representations and further discussion is under way. Let me give some of the arguments as we see them so far. We recognise that there are concerns about the lack of legal advice or representation if the limit is raised. Representations point to the fact that when people make a claim for personal injury, it is more than likely that they will be up against professionals—insurers, lawyers, claims managers, employers or local authorities. They will need to establish whether they have a valid claim; obtain and understand medical and other expert evidence; and then be able to prove their case. They will also have to assess the value of their claim. Those could all be difficult for a claimant without advice or representation, and lawyers say that offers made to non-represented defendants can increase by £1,000 or more once the services of a lawyer are engaged. However, the insurers and local authorities have concerns that the costs of conducting lower-value cases have become disproportionately high. Costs often exceed the amount of compensation, sometimes by a considerable amount. They believe that that could be addressed by increasing the small claims limit so that legal costs are no longer recoverable, although my hon. Friend the Member for Hendon points out that the issue of those costs could be addressed by people settling earlier and not fighting claims that they are likely to lose. The Government are considering all those arguments carefully. We are clear that claims must be settled in a way that is timely, proportionate and cost-effective. That is not always the case at present. However, an increase in the limit to £2,500 or even £5,000 would affect tens of thousands of cases, so before considering such an increase we must consider its impact fully and be sure that we are increasing, not reducing, access to justice. For example, conditional fee agreements have improved access to justice, and mean that more people can pursue their claims. An increase in the limit would affect the viability of conditional fee agreements. It might also open up the possibility of claimants having to pay for legal advice through a large fee being deducted from their compensation, as my hon. Friend the Member for Hendon said. The Select Committee report comments on the importance of the availability of early advice. I have already set out some of the initiatives under way to provide assistance and better information. As part of our review of the personal injury limit, we need to establish whether the voluntary advice sector could cope with a large influx of new cases in an area of litigation that both involves a high level of expertise and hardly features in the current small claims regime at the moment. Although, as the Select Committee rightly points out, district judges will help the claimant in person, many cases never reach a judge, as they are settled before litigation is commenced. Even where litigation is begun, most cases settle before they reach a trial, if we leave aside the point about settlement being at a lower level without the assistance of a lawyer for the claimant. There is also the issue of what any increase should be. Obviously, all such limits are to some extent arbitrary. As others have pointed out, an increase in line with inflation would not take us above £1,500 and an increase to £2,500 or £5,000 would bring some injuries into the small claim track for the first time. We ought to consider whether such an increase can be justified on grounds other than inflation. I note the point made by the hon. Member for Huntingdon about splitting the difference. So far as housing disrepair cases are concerned, as the Select Committee recognised and as the right hon. Member for Berwick-upon-Tweed mentioned, such cases nearly always involve some of the more vulnerable members of society. We are taking that into account in our review. A numbers of hon. Members ventured into a discussion of small claims in the European context. That is quite a challenge. For many people, the idea of even getting to their local court, issuing a claim and making progress seems daunting enough; the idea that one should advance into Europe and litigate for a small amount is even more so. Europe is on to it; it is in hand. With holidays, travel and buying abroad, including via the internet, on the increase the number of disputes will rise, as the hon. Member for Huntingdon said. Citizens Advice already do sterling work, acting as European consumer centres for the UK and helping to resolve cross-border disputes that arise in the EU. Sometimes disputes cannot be resolved so easily and, at present, litigating across borders can be costly, lengthy and time consuming. It is regarded by most people as downright impossible. We believe that the European small claims procedure will be a significant improvement, providing as it does a simple common procedure that does not involve a judgment having to be recognised in another member state before it can be enforced. We are continuing to negotiate with our European colleagues to achieve the best possible outcome. Already, we have secured agreement over significant aspects of the procedure that it should apply to cross-border cases only. Obviously, that makes sense. It should normally be a written procedure. Perhaps most importantly, the cost of the procedure should not be disproportionate to the value of the claim. A number of hon. Members, including the hon. Member for Huntingdon, mentioned listing. Most public service organisations are moving away from block booking. Obviously, it is right that that is reflected on. We recognise the problems that block listing small claims can cause litigants. The reason for block booking is that it is regarded as the most efficient use of judicial and court resources. We have to strive to reach a better balance between the providers of the service and its users. We are reducing the number of hearings in court wherever possible by extending the scope for telephone hearings. Hopefully, there will not be block booking of telephone hearings. That will save litigants not only waiting time but also time and money spent travelling to court. We will continue to discuss with HM Courts Service the points that have been made about block booking and listing. As I have already said, our small claims system is already well regarded. However, we are not complacent. It provides a low cost and generally effective system for a large number of litigants. There are still problems with IT. We have much further to go. Enforcement will never be an easy nut to crack, but we must do more about it and we must get parliamentary time for it. As far as raising the limits is concerned, the debate that has followed the report has shown that it is not straightforward by any means.