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Government set to raise small claims limit to £5,000

Ministry of Justice

The government’s measures to reform the personal injury sector have been in the news a lot recently, and we’ve covered them in detail in our blog. Just last month, we reported that the whiplash reforms were to be put on hold by the Ministry of Justice (MoJ), but it appears this news was a little premature, as it was recently reported by the BBC that the small claims limit is set to rise to £5,000, while damages for ‘minor’ whiplash injuries are set to be slashed.

According to the BBC Radio’s You and Yours programme, the government is set to increase the limit in small claims court for all personal injury claims to £5,000 from the original £1,000. According to the report, the MoJ will hold a ‘public consultation’ before introducing the new reforms, and the government has reportedly come to this decision because of the apparent ‘predatory claims industry’ in the UK.

The BBC programme also reported that the government is to cap compensation for minor injuries suffered in road traffic accidents to around £400, while government ministers also want to introduce a ‘transparent tariff system’ for more serious injuries.

Over 800,000 claims to be affected each year

The news has shocked the personal injury sector and confirmed the biggest fears of many claimant solicitors, and many leading experts have expressed their concerns about the reforms. According to analysis by the National Accident Helpline, the rise in the small claims limit will affect around 800,000 personal injury claim each year. What’s more, the analysis shows that the changes will affect more than 140,000 non-whiplash related claims each year, including accidents and work and clinical negligence, which the government has already said have no clear link to fraud. The National Accident Helpline has said that the changes will have unintended consequences on non-whiplash claims and will likely have a damaging impact on genuine claimants.

A secret attack on UK workers

It wasn’t just the National Accident Helpline that came out against the plans, many union chiefs are furious with the reforms, which they see as a secret attack on UK workers by making it harder for them to claim compensation for injuries sustained in the workplace. The Unite chief, Len McCluksey, said that the union is outraged that the reforms don’t just target road traffic accidents, but all personal injury claims, meaning many hard working employees will be unable to claim compensation for legitimate injuries. He continued to say that the changes amount to nothing more than a “secret assault on employees injured at work”.

A MoJ spokesman said that no final decisions have been made, but that 80% of all personal injury claims in the small claims court are whiplash related, and that the £1,000 limit hasn’t been raised since the early 1990s. However, the timing of the announcement has come at a time when the number of employment tribunal claims has fallen each month from 16,000 in 2012-2013 to 7,000 in 2015-2016 following the government’s decision to increase court fees.

Here at Fonseca Law, we support the government’s overall plan to reduce fraudulent whiplash claims, but not at the expense of genuine victims’ access to justice. We feel the rise in the small claims limit is not the answer and urge the government to focus their efforts on other measures. If you have been injured through no fault of you own, our personal injury solicitors are ready to help you claim the compensation you deserve. Contact us today on 0800 157 0770, fill out our online evaluation form or email; you can also pop into our offices based in the heart of Ebbw Vale, South Wales.