Government to introduce legal costs cap to support victims
Legal costs will be capped in lower damages clinical negligence claims to support victims, speed up justice and protect taxpayers and NHS England cash.
- Limits to be placed on how much lawyers receive from lower damages clinical negligence claims
- This will save an estimated £500 million over the next decade which could be spent on patient care
- Changes will better support victims and preserve access to justice
Legal costs will be capped in lower damages clinical negligence claims to support victims, speed up justice and protect taxpayers and NHS England cash.
During the past 16 years claimants’ legal costs have risen four-fold for claims of up to £25,000. The amount spent by NHS England on clinical negligence claims has also risen from £0.6 billion to £2.6 billion despite the number of claims remaining stable.
This has created a situation where the claimants’ legal costs are disproportionate and on average double what the claimant themselves receives.
These costs are funded from the core NHS budget. It is estimated that introducing this system of fixed recoverable costs would save NHS England £500 million during the next decade, which could be spent on patient care.
Minister for Health, Maria Caulfield, said:
We want a fairer system for victims of clinical negligence which provides speedier justice while also protecting NHS and taxpayer funding.
Those providing legal representation are due fair remuneration for providing these services but this should not be out of proportion to the claim or be to the detriment of justice or front line services.
By introducing fixed recoverable costs for clinical negligence claims of £25,000 or below, we’re ensuring a better balance between costs and compensation.
The decision follows a consultation, which the government has now responded to. It concluded that claimant legal costs are too high and the length and complexity of the legal process can also be disproportionate given the relative straightforwardness of many claims at this level. This also means people who have been harmed are waiting longer to receive compensation.
Introducing a system of fixed recoverable costs is expected to speed up the process and at a lower and more proportionate cost while protecting victims and ensuring access to justice continues.
This will not impact on higher value claims and would only affect the level of the claimants’ legal costs, not the compensation for the claimant.
The rate of fixed recoverable costs under the recommendations are higher than those proposed in the consultation. The bolt-on amounts for those claims involving protected parties or children, will rise from £650 to £1,800.
The scheme will also give defendants responsibility for paying the costs of neutral evaluation, where an experienced legal professional evaluates the claim to speed up the process without the need to go to court.
A further 6-week consultation is also being launched to address whether disbursements - legal costs incurred over and above claimants’ legal costs such as court fees - should be included within the fixed costs.
The new rules are expected to come into force in April 2024.
Background information
The National Audit Office report ‘Managing the costs of clinical negligence in trusts’ identified claimant legal costs as a significant driver of the rise in the overall cost of clinical negligence claims in recent years.
These reforms follow Sir Rupert Jackson’s (then Lord Justice Jackson’s) 2017 recommendation that the Civil Justice Council (CJC) develop a bespoke, streamlined system of fixed recoverable costs. In 2022 we consulted on proposals closely aligned to the CJC’s 2019 report recommendations on the fixed recoverable costs process and developed with extensive input from claimant and defendant representatives.
Fixed recoverable costs in lower value clinical negligence claims: consultation outcome