Compensation Bill [HL]

moved Amendment No. 40:"Page 2, line 42, leave out paragraph (b) and insert—" ““(b)   is independent of any provider of claims management services,”” The noble Lord said: The amendment follows the debate we have had on previous amendments. It singles out independence as a key issue. Amendment No. 40 would leave out paragraph (b) on page 2, line 42, which reads:"““will make arrangements to avoid any conflict of interest between the person’s functions as Regulator and any other functions””." It would insert a new paragraph (b), stating,"““is independent of any provider of claims management services””." Nothing in the Bill appears to require the regulator to be independent of any service provider. The noble Lord, Lord Goodhart, referred to that a while ago when he specifically named the Claims Standards Council and its lack of clear independence. It had previously been the Claims Standards Federation, which was a representative organisation, and it has evolved out of that background. There is therefore a history in this sector which, combined with the failure to proceed down the self-regulatory route makes us believe that an amendment similar to Amendment No. 40, if not this one, must be incorporated in the Bill. We need more than self-regulation on stilts. I can see the argument for providing those stilts, but as currently drafted the clause does not go anything like far enough in providing certainty that the regulator will possess independence and will be a regulator whose integrity is beyond doubt and whose impartiality is sacrosanct. I want to see the regulator embody the three qualities of independence, integrity and impartiality because the regulator must be able to stand between the claims management companies and the public. However, the legislation as drafted, in particular with paragraph (b) relating to conflict of interest, might give the impression that the regulator might need to take steps to ensure that he or she is not conflicted. That will not inspire public confidence. We have already made the point about independence and I do not detect that there is a willingness in the Committee to compromise on that, particularly given the widespread assumption, to which the noble Lord, Lord Goodhart, has referred, that the Claims Standards Council is seen as a candidate for the role of regulator. We have not had explained to us—I may have missed it—what happened overnight between 21 March, when the noble and learned Lord the Lord Chancellor referred to self-regulation, and 22 March when he announced statutory regulations. But we have only to see the speed with which the noble and learned Lord has moved from advocating self-regulation to the proposals in this Bill to realise the need for outside intervention. I hasten to add that I am not criticising him for seeing the light, although self-regulation in this sector was always an ambitious enterprise. I voiced that view on several occasions. Now we are where I wanted us to be and I share everyone’s concern that this regulator should be set up as quickly as possible. But please may we entrench the independence of the regulator by accepting the amendment? I make only one reference, which is to the report of the National Association of Citizens Advice Bureaux on the challenges to access to injury compensation, entitled, No win, no fee, no chance, to which I know the noble Baroness has already referred. On page 4 it states:"““Key messages for reform of funding for personal injury cases include . . . Claims managers, intermediaries and organisations introducing consumers to legal processes should be subject to independent regulation””." That is the key purpose of the amendment. I beg to move.