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Clause 10 - Power of scheme administrator to help people bring proceedings

Mesothelioma Bill [Lords] – in a Public Bill Committee at 12:00 pm on 12th December 2013.

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Photo of Stephen Phillips Stephen Phillips Conservative, Sleaford and North Hykeham 12:00 pm, 12th December 2013

I beg to move amendment 29, in clause 10, page 6, line 16, after ‘proceedings’, insert—

‘in the name of that person’.

Photo of Philip Davies Philip Davies Conservative, Shipley

With this it will be convenient to discuss the following:

Amendment 30, in clause 10, page 6, line 16, after ‘help’, insert—

‘including indemnities against adverse orders for the costs of any proceedings or any application made therein’.

New clause 6—Payments for legal services in civil cases: diffuse mesothelioma proceedings—

‘(1) Section 48 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012 (Sections 44 and 46 and diffuse mesothelioma proceedings) is amended as follows.

(2) In subsection (1), omit from “mesothelioma” to the end of the subsection (including paragraphs (a) and (b)).’.

Photo of Stephen Phillips Stephen Phillips Conservative, Sleaford and North Hykeham

Amendments 29 and 30 stand in my name, and it is to those that I therefore wish to speak.

The purpose of amendment 29, which I do not intend to press, is to confirm that the proceedings to which subsection (1) refers are proceedings that will be taken in the name of the applicant to the scheme. It may be that the Minister will be able to confirm that now.

Photo of Stephen Phillips Stephen Phillips Conservative, Sleaford and North Hykeham 12:15 pm, 12th December 2013

I am grateful for that confirmation. On that basis, I do not need to say anything more about amendment 29.

Amendment 30 would make it clear that in helping a person to bring relevant proceedings under clause 10, the scheme administrator may offer an indemnity

“against adverse orders for the costs of any proceedings or any application made therein” which that person might bring. Perhaps the Minister can short-circuit that. All I seek to clarify is that such help is within the powers of the scheme administrator.

Photo of Mike Penning Mike Penning The Minister of State, Department for Work and Pensions

I can confirm that that is within the powers of the administrator.

Photo of Stephen Phillips Stephen Phillips Conservative, Sleaford and North Hykeham

The amendments are now in the hands of the Committee. I shall say no more. After the right hon. Member for Wythenshawe and Sale East has spoken on his new clause, I will seek leave to withdraw the amendment.

Photo of Paul Goggins Paul Goggins Labour, Wythenshawe and Sale East

It is a pleasure to see you in the chair again, Mr Davies, and a pleasure to follow the hon. and learned Member for Sleaford and North Hykeham. Any member of the Committee could be forgiven for asking the straight question, what on earth has new clause 6 got to do with the Bill? If they thought that, they would have a considerable amount of my sympathy. The Legal Aid, Sentencing and Punishment of Offenders Act 2012—the LASPO Act—has absolutely nothing to do with the Mesothelioma Bill, but Ministers keep trying to connect them. I am sure they are doing so with the best intentions—to send a message that they care about the support available to those who suffer from mesothelioma—but unfortunately there is no connection. With the help of the Minister, my hon. Friend the Member for Stretford and Urmston and others, I hope that we can get clarity this morning.

Photo of Kate Green Kate Green Shadow Minister (Work and Pensions)

I am pleased to support my right hon. Friend. I first raised the issue with the Justice Secretary in Justice questions on 12 November, where I asked precisely what my right hon. Friend asks: what connection, if any, exists between LASPO 2012 and this Bill? The Justice Secretary said that he did not know, but would undertake to find out. I have not heard back from him, but as my right hon. Friend says, the Department has continued to issue statements, including a written ministerial statement last week, connecting the two. I asked again, by letter, this week if the Justice Secretary could advise me, but I am afraid that I have not had a reply.

Photo of Paul Goggins Paul Goggins Labour, Wythenshawe and Sale East

I am sorry that my hon. Friend has not had a reply from the Justice Secretary. I took heart from the fact that he did not know the answer to her question and was honest enough to say so from the Dispatch Box, because at least that meant there was nothing in the front of his mind that connected the two. It gives me hope that when he finally replies to her, we might get a better answer than we have at the moment.

Sections 44 to 46 of the LASPO Act brought in the new arrangements for conditional fee agreements—so-called, no-win, no-fee arrangements. Section 48 provides an exemption from those new arrangements for mesothelioma victims, until such time as the Justice Secretary carries out a review and issues a report. Parliament made its view clear during the passage of the Act. An amendment was passed in the House of Lords that exempted mesothelioma sufferers. Hon. Members from both sides will recall our vigorous debates in the House of Commons over the issue and the strong sense that it was repulsive that people who are given a diagnosis of mesothelioma and know that they might have only months to live might have to give up 25% of their damages to pay a success fee to their lawyers and would therefore have to shop around to get the best deal from those who might represent them. The idea was repulsive. Although there was no successful vote in the House of Commons, there clearly was a strong view.

Section 48 was a compromise. The Government got the LASPO Act and Parliament got its exemption, albeit subject to the review and the report that would then be issued. However, there was no time frame on that review and report so there was a question about how long the grass would be and when the review would be carried out.

In passing, I strongly commend the hon. Member for Chatham and Aylesford (Tracey Crouch) who, throughout those debates, sought properly to work on a cross-party basis to bring forward the arguments that we cared deeply about on both sides of the House. She happens to have had considerable experience in this field before coming to the House. It is the tradition of this House that most of us are fundamentally loyal to our parties, but we sometimes reach out to those on the other side who share our concerns. It was positive of the hon. Lady to do so on that occasion.

The compromise has been beneficial. Just the other day, I was talking to Tony Whitston of the Asbestos Victims Support Group Forum UK—we have all had the benefit of his briefings—who described the new arrangements under which mesothelioma victims are exempted as a real boon, because he can now say to the victims and their families, “There is no complication. You can take this case on and if you win you keep the whole of the damages, and if you lose it costs you nothing.” It is as simple as that. For people in great distress, that is a comforting message to hear. Parliament should be pleased that the compromise produced a simpler and clearer system. We must remember that one in seven people with a diagnosis of mesothelioma do not make a claim, such is the complexity of the system. It is important to make it as simple as possible.

We had a compromise and it is working well for victims, but in July the Ministry of Justice produced “A consultation on proposals to speed up the settlement of mesothelioma claims in England and Wales”. It is about civil claims and how to speed up the system. It contains two main proposals. I do not want to dwell on the details because they are not relevant to the Committee, but one is a pre-action protocol and the other is a proposal for fixed costs. The victim support group expressed great concern about that because it believed that the two proposals would slow the system down instead of speeding it up. I am delighted that having conducted the review, Ministers in the Ministry of Justice concluded that that was correct, so they do not intend, at least at this stage, to proceed with the pre-action protocol or the fixed costs.

However, in the written statement accompanying the decision, the Under-Secretary of State for Justice, the hon. Member for North West Cambridgeshire (Mr Vara) said:

“The Government have carefully considered the responses and have concluded that they intend to apply sections 44 and 46 of the LASPO Act to mesothelioma cases, as for all other personal injury cases. The Government do not believe that the case has been made for mesothelioma cases to continue to be treated differently”.——[Official Report, 4 December 2013; Vol. 571, c. 56WS.]

The Minister made a clear statement that the Ministry of Justice has taken a different view from that of Parliament and that there should be no exemption for mesothelioma sufferers. It is interesting that the statement says that the case has not been made out for mesothelioma cases to continue to be treated differently, because that question was never asked in the consultation.

The review of section 48 was an afterthought in the consultation document. Clearly, Ministers thought they could tack it on to the core consultation about speeding up the process. The question that respondents were asked was:

“Do you agree that sections 44 and 46 of the LASPO Act 2012 should be brought into force in relation to mesothelioma claims, in the light of the proposed reforms described in this consultation”— they have now been ditched—

“the increase in general damages”—

I acknowledge that a 10% increase has been put in place and is welcome—

“and costs protection described above”— again, it has been ditched—

“and the Mesothelioma Bill”— which this has nothing to do with. The question is pretty flawed. The actual question about whether mesothelioma victims should still be exempt was never actually put. Parliament believed there should be an exemption for mesothelioma sufferers, albeit it was a compromise and a temporary arrangement, but we made it very clear to Ministers that an exemption should be in place. It is important for Ministers to reflect that they have drawn a conclusion based on a question in a consultation that was never properly and rigorously carried out.

My new clause 6 seeks to make the exemption of mesothelioma victims from the new conditional fee agreement permanent. There are two reasons for that. The first is the human impact. I go back to the view that Parliament expressed, which is that expecting mesothelioma victims with months to live to give up 25% of their damages to lawyers as a success fee is repugnant, and Parliament should continue to be against that. We should not expect people with a terminal illness to shop around for the cheapest deal that they can get.

Secondly, the decision to proceed with the introduction of sections 44 and 46 is based on a flawed consultation. The question about whether mesothelioma victims should continue to be exempt was never put, so people were not asked to answer that specific question. Had they been, they would have provided considerable evidence to support the argument that the exemption should be allowed to continue. Based on those two arguments, the exemption should continue.

There is no connection between the two because the LASPO Act concerns civil claims where the victim knows who the employer was, knows the insurance company, and can therefore make a civil claim. The Mesothelioma Bill, which Ministers keep saying is connected with that, is about a scheme to produce a fund of last resort for those who do not know who the employer and insurance company are. Someone able to benefit from the fund introduced by the Bill would never be in a position to make a civil claim, because they would not know who the employer or insurer was.

I look forward to the Minister’s response, and I genuinely hope that in our discussions now and perhaps subsequently we can make substantial progress on the issue.

Photo of Mike Penning Mike Penning The Minister of State, Department for Work and Pensions

The right hon. Member for Wythenshawe and Sale East is absolutely right. When I looked at new clause 6, I thought, “What has this got to do with my Bill?” I still feel the same. The majority of his speech on his new clause was to do with issues that relate to another Department, and, in all good faith, absolutely nothing to do with the Bill before the Committee today.

To the hon. Member for Stretford and Urmston I can say only that I will do my personal best to make sure that a reply gets to her as soon as possible, but I am a lowly Minister, and the Ministry of Justice will work in its own way, as former Ministers know.

Although the right hon. Gentleman made an excellent speech, I cannot accept that we can introduce a separate discussion from a separate Department on a separate piece of legislation.

Photo of Stephen Phillips Stephen Phillips Conservative, Sleaford and North Hykeham

If, as my hon. Friend says—he may well be right—his view is that the Mesothelioma Bill has nothing to do with either the amendment or section 48 of LASPO, does he agree that the reference in the written statement, to which the right hon. Member for Wythenshawe and Sale East has drawn attention, to the Mesothelioma Bill is at best misplaced?

Photo of Mike Penning Mike Penning The Minister of State, Department for Work and Pensions

I do not think I referred to section 48 in my comments; I referred specifically to the amendment. I too would like to pay tribute to my hon. Friend the Member for Chatham and Aylesford. I have known her for many years and she is an extremely honourable lady. Quite understandably, she has expressed her concerns on the issue not only on the Floor of the House, but at other times, particularly during the passage of LASPO. On this occasion, unusually, I must disagree with the right hon. Member for Wythenshawe and Sale East. I would ask him not to press his new clause to a vote so that we can make some progress. I do not feel that his proposals have a place in the Bill.

Photo of Stephen Phillips Stephen Phillips Conservative, Sleaford and North Hykeham 12:30 pm, 12th December 2013

In relation to my own amendments, I have already indicated that, with the permission of the Committee, I will withdraw them. However, if I may, I would like to say two things about the new clause tabled by the right hon. Member for Wythenshawe and Sale East. First, I must say that I was not aware of the written ministerial statement to which the right hon. Gentleman has drawn the Committee’s attention, but I am afraid that I think my hon. Friend the Minister misunderstood the point that I was putting to him. None the less, it is a good point: if, as the Minister says and as seems to be obvious, the Bill has nothing to do with LASPO or section 48, then the reference to the Bill in the written ministerial statement last week seems to be at best misplaced and nothing to the point in that context.

My second point is really for the right hon. Member for Wythenshawe and Sale East, because it may affect whether or not he chooses to press his new clause to a vote. Considering the meaning of section 48 of LASPO, does he think that the review that has been carried out is, in the words of that section:

“a review of the likely effect of those sections”—

44 and 46—

“in relation to…proceedings”— for—

“a claim for damages in respect of diffuse mesothelioma”?

If that is not the case, of course, the Lord Chancellor cannot remove the exemption granted by section 48 in relation to diffuse mesothelioma claims.

Photo of Paul Goggins Paul Goggins Labour, Wythenshawe and Sale East

I have some further thoughts to add. The point that the hon. and learned Member for Sleaford and North Hykeham has just made is correct. My contention is that the consultation was flawed because it did not ask what the effect of sections 44 and 46 on mesothelioma victims would be. That question was never asked, nor was the question of whether the exemption should be continued. There was no evaluation of how well the exemption had worked in order to see whether it should continue. The hon. and learned Gentleman makes an interesting point that the Minister may want to reflect on and discuss with his ministerial colleagues—namely, that the consultation did not fulfil the requirements set out in LASPO.

Photo of Mike Penning Mike Penning The Minister of State, Department for Work and Pensions

I think that the points raised by Members today should be drawn to the attention of the Justice Secretary. I will write to him today with a transcript of what has been said.

Photo of Paul Goggins Paul Goggins Labour, Wythenshawe and Sale East

I am grateful to the Minister for that assurance. What with his intervention and the further requests that my hon. Friend the Member for Stretford and Urmston has made for an answer to her letter, alongside the other representations that I am sure are being made, I hope that the point will get through. Frankly, just as in the end we negotiated the compromise over LASPO, the issue here is not about point scoring; it is about getting the best system of support for mesothelioma victims that we possible can.

I appreciate that the Minister has been characteristically straightforward and honest with the Committee in his response to my comments. The issue is not anything to do with his Bill, but he can play an enormously important role by taking back to the Justice Secretary and his colleagues messages about the strength of feeling in the Committee. In the written ministerial statement, in correspondence and in other places, Ministers keep making a connection. They keep talking about synchronisation. Even the coming into operation of sections 44 and 46 is meant to be timed to fit with Royal Assent of this Bill, but they have absolutely nothing to do with each other.

To conclude, I do not know whether the Minister knows when the report is to be published, but let us hope it is quite soon—perhaps even before Report. When it is published, let us hope there is a rather more positive message for those diagnosed with mesothelioma, who have only months to live and who need a system of claims that is as simple as possible.

Amendment, by leave, withdrawn.

Photo of Stephen Phillips Stephen Phillips Conservative, Sleaford and North Hykeham

I beg to move amendment 31, in clause 10, page 6, line 25, after paragraph (2)(b) insert—

‘( ) any proceedings before the Technical Committee established under section 15 and any reference to arbitration arising as a result of the decision of the Technical Committee, or’.

Clause 10 deals with the power of the scheme administrator to help people bring proceedings. At the moment, the help they can give relates to relevant proceedings, which subsection (2) defines as

“proceedings by the person with diffuse mesothelioma against…an employer…or…an insurer” or as

“proceedings by any other person against the employer or insurer for damages under the fatal accidents legislation…or…any appeal arising out of” those proceedings.

Relevant proceedings are not, therefore, defined to include action that needs to be taken by an applicant or anyone else before the technical committee established by clause 15, which we will debate in due course. Among other things, that committee will have the power to decide whether there is an insurance contract against which an applicant under the scheme might make a claim. That is obviously of fundamental importance in determining whether an applicant under the scheme has a claim. The scheme administrator may have strong views as to whether an applicant has a claim, even though the applicant might think differently. However, the administrator should have the ability to help—that is the word subsection (1) uses—an applicant who is before the technical committee, or who is dealing with an appeal after a decision by the technical committee, in relation to whether an employer carried insurance that might respond to a diffuse mesothelioma claim.

Although, again, I will not seek to test the will of the Committee, I hope that the Minister will be able to answer today the serious point I have raised or that he will take it away and deal with it, possibly by way of a Government amendment, on Report.

Photo of Mike Penning Mike Penning The Minister of State, Department for Work and Pensions

If I understand the amendment of my hon. and learned Friend the Member for Sleaford and North Hykeham, the concern is that the primary purpose will be to settle disputes over insurance before proceedings are started in court or before the application is made to the scheme. I will go away and look at this again, but I cannot envisage any circumstances in which a person would voluntarily bring a matter concerning insurance cover to the technical committee in the circumstances my hon. and learned Friend describes. I may have misunderstood him, but I do not really think what he describes is likely. However, as he suggested, I will look at the issue again between now and Report.

Amendment, by leave, withdrawn.

Photo of Kate Green Kate Green Shadow Minister (Work and Pensions)

I beg to move amendment 10, in clause 10, page 6, line 34, at end insert—

‘(6) In any relevant proceedings, whether brought with the assistance of the scheme administrator or not, the court shall, at the request of the person with mesothelioma, assess claimed damages as if the person with mesothelioma had already died and the court were assessing damages, including for bereavement, pursuant to the Fatal Accidents Act 1976.’.

This amendment also relates to the level of payment a sufferer would receive. In particular, it looks at the possibility of adopting the approach taken in the Fatal Accidents Act 1976 to sufferers who are still alive when their claim is dealt with and to those who have already died.

Of course, mesothelioma is invariably terminal. Yet, despite that, the current civil compensation awards will be different for those claimants who are still alive at the time their payment is settled; they will be lower than  payments made after the death and go to the benefit of the claimant’s dependants. However, if we allowed payments to be assessed on the basis of the Fatal Accidents Act 1976, regardless of whether the sufferer is alive or dead, we would be able to ensure that sufferers are able to achieve the same level of compensation. It would also have the effect of raising the average civil compensation level with benefits for those claimants applying to this scheme.

Section 1 of the 1976 Act allows claims for damages by the relatives of deceased persons. It states:

“If death is caused by any wrongful act, neglect or default which is such as would (if death had not ensued) have entitled the person injured to maintain an action and recover damages in respect thereof, the person who would have been liable if death had not ensued shall be liable to an action for damages, notwithstanding the death of the person injured.”

The Act allows claims under three headings: dependency claim, for economic loss; bereavement claim, in recognition of grief by a further restricted class of dependant; and funeral expenses. All of those should be available to mesothelioma sufferers, regardless of the time of the claim.

In contrast, as I understand it, civil employers’ liability claims are assessed under just two headings: pecuniary damages involving monetary loss, such as loss of earnings, medical and travel expenses and so on; and non-pecuniary damages involving compensation for pain and suffering and loss of amenity, such as changes in impact on lifestyle. Consequently, claims for damages after a mesothelioma sufferer has died are reportedly more generous than those that are made while the claimant is still alive. My concern is that that will have the same knock-on effect for receiving payments under this scheme, because the payments that they will receive will be pegged to average civil compensation.

It would be useful if the Minister could share with the Committee—perhaps not today—any statistics that may be available, both on average claim awards before the death of a claimant and the level of awards afterwards. Could he also let us know what proportion of claims is being settled before and after the death of a claimant, and whether similar proportions are expected for claims under this scheme?

Photo of Mike Penning Mike Penning The Minister of State, Department for Work and Pensions

I would like to clarify something before my response. I think the hon. Lady is saying that we should, for want of a better word, interfere with the amount of compensation in the courts, so that that reflects what the Bill’s fund provides. Is that where we are?

Photo of Kate Green Kate Green Shadow Minister (Work and Pensions)

The Minister is correct; that is what my amendment says. I do not intend to press for a vote as it is a probing amendment so that we can explore the issue. If for all sorts of justifiable reasons the Minister is unable to accept that we should use the Bill to amend the approach that takes place in the courts regarding civil claims, where an employer or insurer can be traced, I will understand. In that eventuality, would the Minister look—-not necessarily today but as the scheme is developed before regulations—at how we could offer extra support for mesothelioma sufferers through this scheme?

Photo of Stephen Phillips Stephen Phillips Conservative, Sleaford and North Hykeham

As the hon. Lady acknowledges, this may be a broader problem, and she said she is not going to test the will of the Committee today. However,  does she agree that this is matter Parliament has to look at? Mesothelioma is not, of course, the only disease that carries with it a death sentence of months or years. It might be a problem that needs to be addressed across a much broader canvas than the one her amendment contemplates.

Photo of Kate Green Kate Green Shadow Minister (Work and Pensions)

I am grateful for that useful suggestion, with which I strongly agree. In the context of the Bill, I hope the Minister might at least be able to give thought to how in the context of this scheme we could be as generous as possible to sufferers, in the certain knowledge that the condition is invariably fatal and quickly so. I do not intend to press to a vote but I look forward to the Minister’s comments.

Photo of Mike Penning Mike Penning The Minister of State, Department for Work and Pensions 12:45 pm, 12th December 2013

The shadow Minister is right that I do not feel that this Bill is the right vehicle for the discussion. I agree with my hon. and learned Friend the Member for Sleaford and North Hykeham, who intervened, that the issue should be discussed more widely because this is not the only disease that has such terrible effects on people’s lives and is terminal.

As I understand it, the National Institute of Economic and Social Research publishes relevant figures. If it were not to do so, I would arrange for the relevant Department to indicate how it intended to publish the figures, so that we could have a comparison going forward, because I think that that is a very important point. I am pleased to hear that the shadow Minister will not pursue the amendment.

Photo of Kate Green Kate Green Shadow Minister (Work and Pensions)

I am grateful to have had the opportunity to raise the issue and I am grateful for the Minister’s offer to obtain the necessary statistical information. I hope that, specifically in relation to mesothelioma, that will be available to inform our continuing discussions on Report and as the regulations are debated. I also hope that the Minister will want to support what I think is a fairly widespread mood in the Committee that this issue is one that Parliament should take an early opportunity to look at in its broadest context. Any support that the Minister can give us in that endeavour would be extremely welcome. As I said, I do not intend to press the amendment to a vote. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 10 ordered to stand part of the Bill.