Clause 70 - NHS costs recovery
Health Bill
6:30 pm
Andrew Lansley (Shadow Secretary of State for Health, Health; South Cambridgeshire, Conservative)
We have shifted to a different subject. The Minister will no doubt have text that explains the clause better than I can. I recall the discussion that we had on the 2003 legislation about the extension of NHS costs recovery, which has not been brought into effect. If I remember correctly, the previous provision, which was for the recovery of costs when road traffic accidents gave rise to NHS treatment and there was an insurance policy in place that enabled a liability to be met by the insurers, was to be extended in the 2003 legislation to personal injury claims. In effect, it was likely to apply mainly to occupational health-related claims and the like.
My memory is that the Government legislated for that cost recovery in 2003 and subsequently consulted on the nature of it. In the course of that consultation, problems emerged about the precise circumstances in which costs could be recovered. The explanatory notes help us by stating
''contributory negligence to be taken into account''.
The previous legislation simply would not have enabled the recovery amount to be varied.
We expressed concern once about the extent of the liability that was likely to emerge for businesses more than once in the course of the discussion on the 2003 legislation. It has not been my responsibility since, but I am aware that since 2003, and particularly during 2004, there were substantial increases in the cost of employers' compulsory liability insurance. In fact, many insurers found that they were doubling or tripling it. I shall not rehearse the ways in which the Government have tried to respond to that, not least because I do not precisely remember them all. They have intervened since the 2003 legislation through such things as the Office of Fair Trading investigation to determine whether there were any difficulties in the marketplace. Also, the Department for Work and Pensions had a review, the purpose of which was to work with the industry to try to offset the rising costs.
All of that is slightly by the way. The point is that the Minister with responsibility for small business, who is one of the relevant Ministers in the Department of Trade and Industry—the Minister knows who I mean—made it clear that the Department would not introduce this additional imposition on businesses until such time as the problems associated with the rise in employers' compulsory liability insurance and the cost that that would impose on businesses had been resolved. I believe that it was the hon. Member for Edinburgh, South (Nigel Griffiths), who is now the Deputy Leader of the House of Commons, who said that. I do not think for a minute that those problems have been resolved.
I know enough about my friends in business representative organisations, whether it be the Federation of Small Businesses or the British Chambers of Commerce—I declare a past and current interest—or others. They would tell us that employers' compulsory liability insurance continues to rise. The market is much more difficult for businesses than it used to be and, notwithstanding the fact that this part of the Bill will somewhat ameliorate the total extent of the increase in costs that businesses have to bear, we are looking at a substantial further increase in the charges that will have to be met through personal liability insurance. That will have an upward impact on premiums.
I do not have the regulatory impact assessment in front of me, but I am sure it will say that that is not a problem because the Bill reduces the amount that is recovered overall from businesses. However, it is a problem, because we have been holding off—I say ''we'' advisedly. The Government have held off introducing this additional cost recovery scheme because of the problems that business is experiencing. I want to know why they are not continuing to do that. It is clear from what the Minister said that they propose to introduce the measure in 2006. She might be able to confirm the date, but I thought that it was fairly soon. I reiterate our concern that it should not be introduced, with the resulting additional increase in premiums, unless and until the problems in the business sector about access and the cost of employers' compulsory liability insurance have been resolved.