03 FEB 2011

Legal Aid Reform

Paul Uppal: I, too, thank the hon. Member for Makerfield (Yvonne Fovargue) for introducing this debate. In the spirit of the sentiments expressed by my hon. Friend the Member for South Swindon (Mr Buckland), I want to take part not in a partisan way, but on the basis of trying to progress the debate. Other Members have spoken about employment, welfare benefits, education and immigration, but it is on clinical negligence that I wish to express some of the views that I have encountered at my weekly surgeries.The Government's view is that if legal aid for clinical negligence cases is removed, alternative funding will be available in the form of conditional fee arrangements, which will be funded on the basis of a success fee and after-the-event insurance. Under Lord Jackson's reforms, such fees will be unrecoverable from the losing party. The point that has been made to me, which I wish to highlight to the Minister, is that if legal aid is withdrawn and cases have to be funded by conditional fee agreements with insurance, there will be instances where the cost to the public purse may well be higher. For example, a solicitor at my surgery told me about a cerebral palsy case that settled for more than £3.75 million. The costs involved were more than £100,000. The case was legally aided, but if it had been funded through a conditional fee arrangement, with, say, a recoverable success fee of 60%, the total costs would have been £160,000. There would also have been a substantial after-the-event insurance premium, so the case would have cost the public purse far more than if it had been funded by legal aid. That is the position where cases are successful, and where the Legal Services Commission does not pay anything.

I appreciate that some Members may have not followed the full argument, and I apologise for using legal jargon, but the fundamental point remains that although we may be saving legal aid costs, we may end up paying more into the national health service budget to cover legal fees and insurance premiums. In essence, we will have public money chasing public money, in a circle that will not deliver legal justice on a value-for-money basis. The counter-argument is that if Lord Jackson's recommendations are implemented in full, there will be no increase in costs, as success fees and after-the-event insurance premiums will not be recoverable from the losing party. However, Lord Jackson has recommended that damages be increased by 10% to make up for the shortfall in solicitors' costs, with a 25% cap to be deducted from damages. In the cerebral palsy case that I have mentioned, that means that the damages would have increased by £375,000, which would be an alarming escalation in public funds paid.

I appreciate the difficulties caused to the Government by the escalating drain on the public purse, and I suspect that many measures relate to concern about the costs incurred by solicitors who are chasing ambulances or investigating spurious, unviable and unsuccessful cases. However, I will say to the Minister, who I know has a great deal of expertise in this field, that clinical negligence cases are now conducted by a small group of specialist solicitors who focus on dealing with complex cases. It is increasingly rare for solicitors to tread the old route of simply applying for investigative help certificates for every client who walks through the door with a potential claim, because the cases are just not viable.

The special cases unit of the Legal Services Commission, which is based in Brighton, now seems to apply a robust criterion to all applications for LSC funding in order to ensure that cases with merit are granted funding. David Keegan, director of the commission's high cost cases unit, has said:

"We need to ensure that access to justice is as wide as possible and it is in the best interest of clients."

I would add only that those objectives must be reconciled in the most cost-effective way possible.

I think it pertinent that Lord Jackson's objective in conducting his year-long costs review was to make recommendations for the promotion of access to justice. If legal aid is no longer available, the costs may become disproportionate.

I am acutely aware of the Government's laudable intentions, but I worry about unintended consequences. The point that has been made to me most forcefully, time and again, is that if we genuinely want to save costs, it is imperative for the national health service litigation authority to make early admissions of liability rather than protracting settlement of cases. What tends to happen is that no one in a hospital wishes to admit negligence, and a game of bluff develops. Solicitors and the NHSLA conduct a legal battle, which is often settled at the last minute. That is why we see headlines about cases involving liability claims amounting to tens of thousands of pounds running up legal bills of hundreds of thousands of pounds. Like most people, I cannot understand the logic of that. In such cases, early settlement would avoid a pointless game of poker with our money, the emotions of patients, and the good will of staff in the NHS.

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