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We are not trying to establish an alternative courts procedure through the system, but if it is independent, members of the public may certainly be able to treat
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the process as if it were their day in court. They will have the facts examined, they will know what happened and they can insist on the lessons being learned. That point comes home.

To an extent, we have been talking about complaints in general. The Bill is about a distinct subset of complaints that give rise to this kind of claim. However, across the complaints procedure we can see how often members of the public and patients want an independent investigation. That has happened in so far as they have been given the opportunity to go to the Healthcare Commission. Previously, people had community health councils, which often supported complainants. The Government took that away from them. [ Interruption. ] There is an independent complaints service. Many members of the public go to the Healthcare Commission, not least because they want the independence of the commission’s investigation.

The hon. Member for Birmingham, Edgbaston (Ms Stuart) just asked about time limits. She is right. There is sometimes a case for considering how long it is taking to examine complaints. I applaud much of the Healthcare Commission’s work, but it has had to set limits on the time that it will take to examine complaints. I am a bit disappointed because in letters I have had from the Healthcare Commission, make it perfectly clear that those time limits do not apply to the existing backlog of cases. There will be some cases that are taking a long time and there will be no certainty about how long it will take to resolve them. That gives an indication of the volume of activity that we are dealing with and how important it is to members of the public that cases do not go on for months. Sometimes it takes more than a year to resolve a case.

Rob Marris: The hon. Gentleman may be aware that in planning law, if the local authority fails to respond to a planning application within six weeks—I think that that is still right—that application is deemed to have been refused.

Mr. Kidney: Eight weeks.

Rob Marris: My hon. Friend tells me that it is eight weeks. Does the hon. Member for South Cambridgeshire (Mr. Lansley) agree that there should be a similar system for NHS redress claims, so that there would be a deemed admission of liability unless there had been a response within a specified period?

Mr. Lansley: I am not sure that I do. I feel myself not bending towards that idea. In planning, one can go to the Government office and seek an appeal on the grounds of non-determination. In this instance—if the hon. Gentleman cares to join us in supporting the Bill as it stands—it seems to me that if there is an independent process, at least there is a reasonable chance of there not being a delay occasioned by the interests of the trust itself. At least if there is some delay, it will be as a consequence of the volume and complexity of the cases being dealt with. I hope that the independence of the system and the ability to appoint independent redress investigators will give greater flexibility, rather than having things determined
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simply by the resources of the NHS Litigation Authority, as the Government propose.

Mr. Brian Jenkins (Tamworth) (Lab): The one thing that strikes me as a common chord is that I do not believe that there is any financial difference between an independent and an in-house investigation, in so far as there is an opportunity cost in taking surgeons and doctors away from their duties. My main concern is that if independent people are brought in, they will not know the operating methods in the hospital, so it will take them longer to get to the nitty-gritty of the affairs, to get to the people that they need to reach, and to get the information. I am talking about that time delay. Those people might not come up with the same degree of accuracy when they carry out the investigation. That is my difficulty with the independent aspects.

Mr. Lansley: I do not agree with that. Let us face it, under the system that the Government propose, even though it is not independent, there must be a fact-finding process before moving on to a fault-finding process. The Government themselves propose that there should be independent medical experts, who, by their nature, will presumably not be employed by the trust in question, so there will be a degree of independent scrutiny. Frankly, that must be essential because in the absence of independent scrutiny, I am sure that patients would not regard the outcome of an investigation—whether in the form that the Government propose or that which we propose—as having the necessary validity for them to accept any kind of redress. There must be a degree of independence.

Ms Diana R. Johnson (Kingston upon Hull, North) (Lab): Will the hon. Gentleman give way?

Mr. Lansley: I will, but then I must get on to the detail of the Bill.

Ms Johnson: Would the patient redress investigators be lawyers, clinicians, or lay people with just a general knowledge of the health service? What does he envisage that those people’s qualifications would be?

Mr. Lansley: I am sure that that would, in part, depend on the nature of the facts that needed to be established. We are talking about a fact-finding investigation following an assertion of clinical negligence, so it would be likely that those people would be medically trained and, of course, independent of the trust in question. I am sure that Ministers would expect there to be a degree of independent medical investigation, as would be the case under their proposal that independent medical experts be available.

I thank their lordships for their amendments to the Bill. They have given us a Bill that would enable us to set up a scheme that would be coherent and with chances of success that did not exist previously. I especially pay tribute to the work of my noble Friend Earl Howe, on behalf of my party, and that of Baroness Neuberger and Baroness Barker, who speak for the Liberal Democrats. They created a consensus in another place on amending the Bill in such a substantial way.

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As has been illustrated by the nature of our discussions so far today, the debate is not party political, but one of policy and practice. The arguments clearly point towards the merit of the Bill as it stands, so the Government would do well to accept the Lords amendments, rather than trying to reverse them. I was thus sorry to hear the Secretary of State say that the Government wish to change the Bill. Government Members will support the Bill’s Second Reading and endorse its principles, but clearly there is a major principle at the heart of the Bill that the Government do not endorse, which, I fear, shows once again that they, and the Department of Health in particular, do not have the sureness of touch that is needed to deliver better policy. In this case, they would do well to show a degree of humility and accept that there is conceivably a better policy than that which they originally put forward.

Our policy on clinical negligence is simple. Any patient who is injured by negligent treatment should be entitled to compensation. There must be affordable access to justice, and such justice must not lead to excessive compensation or cost, because as we know, every penny lost in litigation is a penny less available to provide patient care. We must thus find a system that is fair, not prone to abuse or excess, not too bureaucratic, and not exposed to speculative claims.

We welcome the principles and intentions that underlie the Bill. We are pleased that the Government recognise that clinical negligence litigation is in serious need of reform. There is widespread concern that the compensation system is complex, unfair, slow, costly and wasteful. The process can be stressful for the parties involved—both patients and health care professionals. The Bill thus represents a limited step towards addressing the problems.

The cost of clinical negligence litigation to the health service in 2004-05 was £502 million. The contingent liability is estimated at several billion pounds. Indeed—the Secretary of State did not mention this—because of the changes in the relevant discount rate, the contingent liability increased by £635 million in the 2005-06 accounts alone.

Of course, legal aid provides the oxygen for medical litigation, because most cases are publicly funded. Last year, 6,217 legally aided clinical negligence cases were concluded. Of those, 2,574 went beyond the investigation stage, and there was a substantive benefit to the claimant in 56 per cent. of cases. Happily, I do not have to do the arithmetic in my head, but the overall success rate for legally aided clinical negligence cases was 23 per cent. That figure, which represents about 1,400 cases, must be contrasted with the hundreds of thousands of adverse clinical events that occur. Even if only a tiny proportion of those adverse events gives rise to injury, it will be apparent to the House that there is still a huge disparity between the number of possible negligence claims and the number of cases that go on to litigation. Indeed, it is curious that a high proportion—perhaps three quarters—of those that are litigated prove not to have substance, while large numbers of potential clinical negligence claims are not even pursued.

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Steve Webb: I am grateful to the hon. Gentleman for giving way, and for his comments about my noble Friends in another place; as he says, we have worked closely together.

May I ask about legal aid, which he just mentioned? The Secretary of State effectively said, “Well, people can go to court anyway,” but is it the hon. Gentleman’s judgment that people who apply for legal aid opt for negligence? Once NHS redress is up and running, the legal aid people will say, “Well, there is a redress scheme and we aren’t going to spend taxpayers’ money on legal aid,” so people on low incomes will not have the option of going to court.

Mr. Lansley: That may be true, and I accept the hon. Gentleman’s point. I find it astonishing that the Secretary of State did not talk about legal aid, because the problems of legal aid go to the heart of the difficulties that we are experiencing with the clinical negligence system. The Government’s apparent desire to avoid that fact is evidence that they have not thought through the policy implications of dealing with the legal aid problems.

Let us run through some of those problems. Legal aid does not ensure access to justice for deserving cases, as most people are not eligible. Instead, it provides access to lawyers for an eligible minority. Legal aid lacks independence. Funding is granted on the advice of the applicant’s lawyer, so there is a clear conflict of interest that may encourage over-optimistic advice, to put it kindly, or speculative litigation, putting it less kindly. Legal aid lacks fairness. Successful defendants cannot recover legal costs. Legal aid puts the claimant in a no-lose position and the health service defendant in a no-win position. It may be cheaper to settle a claim regardless of merit, to avoid irrecoverable legal costs—a practice known as legal aid blackmail.

The Secretary of State referred to the legal costs that the NHS has incurred, and of course the structure of legal aid is one of the reasons why the legal costs that the NHS has had to meet have been so great. Legal aid lacks accountability. Funding decisions involving public money are privileged and confidential, and are not subject to public scrutiny. As a Member of Parliament, I have sought to question some of the decisions made by the Legal Services Commission about the people to whom it grants legal aid. Frankly, that is an impenetrable question. The fact that it has met and made a decision is regarded by the LSC as justification enough.

Most clinical negligence cases are legally aided, but the great majority of households do not qualify for legal aid. Is it the case that clinical negligence harms only people eligible for legal aid? Of course not. It is not a matter of cases not being brought because they lack merit; they are not brought because there is no legal aid available. The record of legally aided claims involving health care is dismal, as I said. In some instances, that has promoted unsubstantiated health claims and scares based on junk science, threatening the health of the nation’s children. Too often, lawyers are the only beneficiaries of publicly funded legal action. Scarce resources are diverted from patient care to lawyers’ fees, all in the name of justice and all paid for by the taxpayer.

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The solution to the problem of clinical negligence litigation lies in the realm of funding. Legal aid has brought relief to many people, but it is a popular misconception to equate legal aid with access to justice. Access to justice is not best delivered by the legal aid system. There is a better way to do that; before the election, we said that we needed wider proposals to reform clinical negligence—I am sure we will return to that. The reforms in the Bill are consistent with a wider reform, but no one should believe that they are sufficient in themselves. However, it is best to confine ourselves to the scope of the Bill, rather than try to debate the wider question of the way in which legal aid can be reformed.

As the Secretary of State mentioned, the origins of the Bill lie in the chief medical officer’s report, “Making Amends”, which considered the problems highlighted by “Options for Change”. The underlying policy of “Making Amends” was to move away from a tort-based culture. It stated that:

Its recommendations

However, the report paid scant regard to the problems of legal aid. The Bill recognises and exposes the failure of “Making Amends”. It is not based on “Making Amends”. Instead of moving away from tort, the Bill makes tort its centrepiece, in clear contradiction of “Making Amends”.

That report by Liam Donaldson contained 19 recommendations, of which 18 are not addressed by the Bill. Indeed, the well-intentioned but ill-considered recommendation No. 2, proposing a no-fault compensation scheme for brain-damaged babies, was dropped last summer. The Bill gives effect only to recommendation No. 1, not in the way that “Making Amends” proposed, but at least by introducing an NHS redress scheme to provide investigation when things go wrong, remedial treatment, rehabilitation and care where needed, explanations and apologies, and financial compensation in certain circumstances. It applies where there is a qualifying liability in tort—that is, a breach of duty causing injury. This is the condition precedent to qualify for the scheme. It is much narrower in scope than a complaint, which may or may not involve negligence.

The Bill is ambitious in its scope. It proposes a package of remedies—a one-stop shop providing different remedies. It represents enabling legislation. The detail will be set out in secondary legislation. It provides a skeleton framework of duties and powers to give effect to the underlying policies, and it is the Government’s underlying policy that gives rise to our concerns.

The Government’s proposal seems to be mainly concerned with compensation, as it can apply only where there is a qualifying liability in tort. It appears to be conceived as an in-house settlement-making process, rather than as an independent judicial investigative process. Liability is to be assessed by the National Health Service Litigation Authority, rather than determined by any independent tribunal. Compensation is to be offered by the NHSLA, rather than awarded by any independent person. We should remember that the NHSLA
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is the body that carries the liability on behalf of scheme members, so it has a vested interest in the matter.

Any offers arising from the process are to be made on a “without prejudice” basis. Although facts or some degree of fault may be disclosed, if the claimant—the patient—does not take up an offer and reach a settlement, that disclosure cannot be used as the basis for a claim, and no admission of liability can be derived from it. Offers are to be accepted or rejected on a “take it or leave it” basis.

The situation in clinical negligence is bad enough, but the Bill as originally drafted would have made matters worse. The response of claimants to such a process may well be to treat it as partial, and as no more than a preliminary stage to legal action. Far from being an alternative to litigation, it would, by virtue of its invitation to claim, have generated more litigation, not less.

The concept of a one-stop shop is superficially attractive, but on closer inspection the Bill was found to be fraught with problems. It sought to combine conflicting functions and it confused fact finding with fault finding, an inquisitorial process with an adversarial process, and open proceedings with “without prejudice” proceedings.

We have consulted widely in formulating our alternative approach, which is now reflected in the Bill. The Government’s willingness to tackle the problems of clinical negligence was broadly welcomed. However, there was a general recognition that the original Bill was fundamentally flawed, and represented a wasted opportunity. In summary, there was a single constant theme: the need for open, independent, fact-finding investigation. The Bill as amended in their lordships’ House reflects that simple point. The amendments have given the Bill functional coherence, and place the interests and priorities of patients at its core.

Our first key concern has been the need for independent investigation. Independence is a basic principle of natural justice, enshrined in the rule against bias—that no man may be a judge in his own cause. The investigation should not be concerned with issues of legal liability. We should separate fact finding from fault finding. There is ample judicial authority for that dichotomy. The Secretary of State spoke about two separate processes, and logically they are two processes. Fact finding and fault finding will be distinct aspects of any investigation. We want the fact finding to be conducted by NHS redress investigators as an inquisitorial process. The investigation may provide the basis for an explanation, apology, lessons to be learned and, where appropriate, an assessment of civil liability and an offer to be made.

The Government’s proposals would have had the NHS investigating itself as judge and jury. The Constitutional Affairs Committee report stated:

We need the reality and the perception to be understood. Justice must not only be done but must be seen to be done.

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