Question put, That the clause stand part of the Bill.

Clause 5 gives insurers the right of recovery against the person actually responsible for the incident to the same extent that the person is liable to the victim. The person actually responsible for the incident could be, for example, the manufacturer. This clause also defines when and how the amount of the person’s liability is settled and when their right of action accrues. It sets out the arrangements and limits on the amounts they recover. This clause will therefore ensure that the insurers are able to recover from those responsible, to the extent that the victim will be able to do so. This will facilitate the effective functioning of clause 2, which imposes initial liability on the insurer or owner of the automated vehicle in respect of an accident.

Subsection (3) requires the insurer, if they recover more than they initially paid out to the victim, to pay the difference to the victim, and subsection (4) ensures the person responsible for the incident is not required to pay the insurer if they have already paid the injured party.

Will the Minister give way?

I had finished, but I give way.

I am most obliged to my right hon. Friend. I am intrigued by subsection (2)(c), which refers to the amount of a claim as settled when it is established “by an enforceable agreement.” In this context, can he give the Committee an example of an unenforceable agreement?

That is a wonderful intervention, which I cannot answer now, but I will answer later. How’s that?

When the Minister sums up at the end of the debate, will he say how he envisages this provision working in practice? An accident occurs, and an injured party is making a claim; the aim of this Bill is to ensure that people are paid out speedily, but the clause describes a process that could be long and drawn out. How does that protect the consumer? Who pays in the first instance? As we have already heard in several debates around this Bill, we are adding more people who could have liability. Because of software upgrades, we are now including the manufacturers—the people who actually design the software. There is no requirement in the Bill for those writing the software to have their own insurance, should their software fail, so where do they come into this process? How do we ensure speedy pay-outs to the consumer when we have an increasingly complex network of people who may have liability in the aftermath of an accident? This clause seems to set out a labyrinth of different permutations that could arise in terms of liability, and that could take some time to resolve. Could the Minister say what is in the Department’s mind and how this will speed matters up?

I would not want to accuse the hon. Gentleman of misunderstanding, so I will perhaps say that I did not make it sufficiently clear in my opening remarks. For it is better to blame oneself than other people. The purpose of the clause is to supplement clause 2, in that it will ensure that victims do not potentially have to pursue major manufacturers through the courts. This is to avoid both the unreasonableness of having to do that and the delays suggested by the hon. Gentleman. It is designed to protect the consumer. At the end of the day, the consumer is our principal concern, as he said in an earlier intervention.

We want the system to operate in a way that is as quick, straightforward and comprehensible as possible for the consumer. That is actually what the clause does, by supplementing clause 2. The business of the relationship between the insurer and the manufacturer will be going on behind the scenes. The consumer will not need to know about that, and will get a speedy and satisfactory resolution of the event in the way that they do now. If there was a difference at all, that is where it lies.

I have listened carefully to what the Minister says and he makes a very salient point. We do not have any objection to the clause.

Before we move on, my right hon. Friend the Member for East Yorkshire raised the issue of enforceable agreements, and I did promise—with your indulgence, Mr Bailey—to respond, in my normal spirit. I am told that the agreement must be legally binding and therefore enforceable in court. Whether that satisfies my right hon. Friend, I do not know, but that is all I have to say, so he is not going to get any more out of me.

Question put and agreed to.

Clause 5 accordingly ordered to stand part of the Bill.

Clause 6