With the general election only two days away, many commentators have suggested that the whiplash reforms will not now come into force in April 2020 as has been proposed.
Are the reforms just delayed though?
The position of the Ministry of Justice (MoJ) has consistently been that 6 April 2020 remains the target launch date – albeit more recently indicating that this is dependent on the outcome on 12 December.
By way of a reminder, the Civil Liability Act 2018 provides a definition for whiplash injury, with secondary legislation required to introduce a tariff based system. The whiplash reform package includes a new online portal, and an increase in the small claims limit to £5,000 for road traffic accident claims (vulnerable road users excluded) and £2,000 for other personal injury claims.
On the basis of past history of IT delivery by government, scepticism continues over whether the new online portal (being developed for these claims), will be ready. Although public testing should have begun in mid-November, any update on this has been prevented by purdah (in place since 6 November).
Even if the IT infrastructure is on track for implementation, there is little sign of progress on any of the pre-action protocol and rules that will sit alongside the online portal (and those required for the extension of the small claims limit to £5,000). Extension of the MedCo medical reporting system, linked closely with the new small claims limit, may delay matters further.
The online system must have therefore been built on a number of assumptions as to how a claim is to be progressed (in isolation of the pre-action protocol and rules which will underpin it). If the protocol and rules are contrary to any of those assumptions, there could be some significant revision to be done and elements of the system re-worked.
Equally, in the absence of the rules being published, all practitioners - be they claimant lawyers, claims management companies, or insurers or defendant lawyers - have been operating in the dark. Any preparation, such as training or system adjustments must again be based on assumptions. Confirmation of the tariff of damages for whiplash injury is also awaited, to be implemented by way of secondary legislation.
For those with the unenviable task of leading the reforms at the MoJ, each day must start with the question of “April 2020 – go no go?” and at what point the decision will be made. If any decision is made it must now be after 12 December 2019 and logic would suggest that the first few weeks of January is more likely for clarity, as we see the post-election ministerial re-shuffling of seats and a new government re-prioritising various projects.
October 2020, later, or at all?
Taking all of the above into account, October 2020 seems a more realistic prospect for delivery of the package. But is that overly optimistic given this time of political and economic uncertainty?
Working through the various possible general election outcomes is a useful approach to considering how much of an impact any changes post 12 December will have.
A Conservative majority would seemingly see the reforms delivered, but there is too short a window for them to be implemented before April, given the small matter of exiting the European Union by 31 January 2020.
If a Conservative government leads us out of Europe at the end of January, will any of the major insurers really be focussed on whiplash reforms? A school of thought exists that insurers will be more concerned about their own supply chains and the impact that delays on motor vehicle parts coming into the country may have on their supply network. In this context, a delay to April 2021 would make sense, as claims and procurement teams wrestle with the challenges Brexit will bring. One would expect there would be little opposition to the idea of a delay from the claimant market.
A Labour majority would raise the question of the future of the reforms as a whole. There is little indication within the Labour party of any real willingness to push these reforms through. The legislation could simply be left to die on the side lines as a Labour government seek to implement their manifesto priorities.
A Liberal Democrat majority – whilst perhaps unlikely, would almost certainly see energy being focused on unpicking Brexit, therefore delaying the reforms.
A Liberal Democrat coalition with either Conservative or Labour, arguably creates the greatest uncertainty given that all proposed reforms would come under review with agreement required on what to move forward with and what to park.
There are so many imponderables in play, however if the reforms do endure, it seems more likely that October 2020 would be possible, but there would need to be a significant movement forward very quickly next year to achieve that.
It is arguable, that an April 2021 go-live date would provide a far more sensible and workable solution for claimant lawyers to adjust their business plans, the MoJ to generate sufficient awareness of the process for litigants in person, and for insurers to adjust their systems, staff training and procedures to implement the new rules.
With the response to Part 2 of the government’s whiplash consultation (relating to credit hire and rehabilitation charges, amongst other matters) also awaited, April 2021 would also provide a window for clarity around the wider reform programme.