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Clause 8 — Reviews and appeals

Part of Riot Compensation Bill – in the House of Commons at 11:25 am on 5th February 2016.

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Photo of Mike Wood Mike Wood Conservative, Dudley South 11:25 am, 5th February 2016

I thank right hon. and hon. Members from all parts of the House who have participated in debates on Second Reading, in Committee and here today. In particular, I thank Ministers and shadow Ministers for their supportive and constructive approach. I thank Mr Lammy, who has spoken persuasively and passionately on behalf of his constituents, and my hon. Friend Gavin Barwell, who has done a lot of work in support of the Bill but cannot speak in the Chamber today because of his other responsibilities.

On Second Reading, I stressed our responsibility as Members of Parliament to bring forward legislation that protects the most vulnerable from harm. That is why I am proud to promote this Bill, which proposes to help individuals and businesses recover from the devastating impact of widespread public disorder in communities. I spoke on Second Reading about my family connection, growing up as the son of a west midlands police officer during the football riots and other disturbances of the 1980s. I told the story of my father being bitten in the stables, and I said that I thought it was safe for me to do so, because my father rarely watches BBC Parliament. Sadly, he listens to BBC WM, so I was not able to keep that as secret as I had hoped.

Like all right hon. and hon. Members, I hope that the Bill will never be used. However, following Neil Kinghan’s review, it is abundantly clear that we need modern legislation that gives us clear guidelines and provisions in the event of any future riots. After the 2011 riots, many vulnerable communities were left counting the cost. The coalition Government responded by pledging to cover the costs incurred by the police to compensate homeowners and businesses under the measures set out in the Riot (Damages) Act 1886. Then, as today, it was clear that the “current”—130-year-old—legislation is outdated and inadequate in providing compensation in the modern world. The language is archaic, and it is unclear in what circumstances claims can be made. That means that decision making after a riot is difficult and time-consuming. There are too many inconsistencies, and it is not fair to those who need support or to those who pay the bill. That is what we need to change with this Bill.

The aim behind the Bill is to protect communities from the devastating losses to which I have referred. It makes much-needed changes to address the concerns that have been raised, while still providing support to households and businesses affected by riots. It proposes to end the unlimited compensation afforded through the 1886 Act, while making sure that victims of riots receive the support that they need. The new compensation cap has been discussed at some length, so I will not add anything further. Suffice it to say that the new provisions will not just save money but improve and modernise the claims process to bring it up to date and make it fit for the 21st century.

The old Act’s short timescales for submitting and evidencing a claim are simply not feasible for many potential claimants. As the House will remember, temporary changes were made to the timescales at the time of the 2011 riots in order to provide a more realistic timeframe. The Bill is intended to put that change into legislation.

The time period set out in the original legislation is clearly not long enough. Many homes and places of business are inaccessible for a considerable period after disturbances of the kind we saw in 2011. Allowing a period of 42 days after a riot to submit a claim and a further 90 days to evidence the claim and provide the details to support it will provide people with a fairer deal at a time when they need the extra breathing space and time to think about and prepare such a claim. As has been said, in many cases they will have to work out whether they ever had a receipt, let alone whether they know where the receipt is after a fire or a riot.

The minimum time allowed is now stated in the Bill. I emphasise that it is the minimum time: it remains entirely within the Government’s competence to decide to have a longer period if and when they think that that would be appropriate. As the Minister said earlier, we must ensure that there is flexibility so that people are not unfairly disadvantaged in extraordinary circumstances —for example, when, whether through illness or another reason, it is not reasonable for them to submit paperwork within the timeframe set out in the Bill.

The reason for switching away from replacement value—old-for-old, as it were—to new-for-old is one of basic fairness for the victims of riots. It is not reasonable to expect people whose homes or businesses have just been devastated by riots, first, to find out what loss adjusters think is the current value of machinery, equipment or property however many years after their purchase, and then to try to source a replacement product of equal value. On Second Reading, I gave the example of a four-year-old dry cleaning machine. It would be difficult to source it, because such machines do not show up every day on eBay. Switching to new-for-old, as most of the insurance industry has done, is sensible, more efficient and, above all, fairer.

Many Members have welcomed the riot claims bureau, which will have responsibility for managing riot compensation claims. The Bill is intended to ensure that there is greater consistency, particularly, as we saw in the 2011 riots, when riots spill over into more than one police force area. In such a case, it may be appropriate for the Secretary of State to assume such powers to ensure that someone can expect the same kind of service, timescales and treatment wherever they make a claim. Again, that is an issue of basic fairness for people affected by riots. The provision will be used if the rioting breaks out in or spreads across more than one area, and for that matter, if the local police decide that they do not have the capacity or expertise to consider such claims—why should they do so? That will particularly affect smaller police forces.

The Bill will allow local policing bodies and the riot claims bureau to place the day-to-day management of claims in the hands of experts. That is significant because although we expect our police forces to do an extremely important job—they do their job extremely well and we can be proud of the role they play—it is not reasonable to expect them to carry out claims handling or loss adjusting. Allowing police and crime commissioners to utilise people trained to play such a role makes sense and enables commissioners to retain full control over financial decisions.

As I have said, the Bill provides for the first time for motor vehicles covered by third-party insurance. It was pointed out on Second Reading that 1886, the date of the current legislation, was coincidentally the same year that the diesel engine was first demonstrated. Unsurprisingly, therefore, the legislation on which we currently rely was not designed around the world of the motor car. We do not know what the nature of riots will be in the future, but there may be widespread damage to motor vehicles. It does not seem fair, and it would not be equitable, for people’s motor cars—if they do not own their own home, their car is probably the most expensive thing they own—to be outside the scope of a compensation claim if they are not covered by their own insurance.

The purpose of the compensation scheme is not to pick up bottomless bills for criminal activity, but to provide a safety net for those in greatest need, while recognising the police’s responsibility to maintain order. That is why we must absolutely recognise the serious implications for communities recovering from major public disorder. Since the 2011 riots, my right hon. Friends in government have worked tirelessly, first by commissioning the Kinghan review and then by holding the Home Office consultation that followed it.

It would be wrong for millions of pounds of public money to be handed over—in essence, to insurance companies—for people who are in a position to insure themselves. That was the thinking behind the cap, and it is also why I limited the extension for motor vehicles to people who would not be covered by their motor insurance.

The provisions in the Bill provide a balance between the responsibility of the police to maintain order and the Government to protect the vulnerable, and the interests of the taxpayer. It retains the principle that the police are responsible for maintaining order, ensures that local accountability remains in the right place and provides local communities with the mechanisms they need to recover quickly from serious disorder.

We all hope and pray that riots of the kind, and certainly of the scale, that we saw in August 2011 will not happen in the future, but hoping for the best can never be an alternative to preparing for the worst. The Bill is about preparing for the worst. I hope it will proceed through the other place as swiftly as reasonably possible so that we can put in place the system we will need should riots take place. The Bill provides a fair deal for the victims of riots and for those who will have to pick up the bill for serious damage caused by them in our communities. I commend the Bill to the House.