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House of Lords

Thursday, 27th March 2003.

The House met at eleven of the clock: The PRINCIPAL DEPUTY CHAIRMAN OF COMMITTEES on the Woolsack.

Prayers—Read by the Lord Bishop of Manchester.

Courts Bill [HL]

The Parliamentary Secretary, Lord Chancellor's Department (Baroness Scotland of Asthal): My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.

Moved, That the House do now again resolve itself into Committee.—(Baroness Scotland of Asthal.)

On Question, Motion agreed to.

House in Committee accordingly.


Clause 87 [Fees]:

Lord Hunt of Wirral moved Amendment No. 132A:

    Page 41, line 30, at end insert—

"but should only seek to recover the recurrent running costs of the courts"

The noble Lord said: We now resume the debate which finished on the previous occasion with the success of Amendment No. 132 on civil court fees. In many ways, as the Minister is aware, we on the Opposition Benches are seeking to assist the Government to resist a Treasury-imposed directive, which would lead to virtually all the costs of civil courts being raised through the level of court fees.

Not that I am ever allowed to disclose any private discussion, but I am aware that there is considerable unrest at all levels of civil justice about this policy. In particular, on the last occasion that the Committee debated the Courts Bill, I quoted the Civil Justice Council, chaired by the Master of the Rolls, which had called on the Government to abandon the policy of raising virtually the full cost of civil courts through fees.

However, as the Minister will be aware, since that date and since the passing of the amendment, the Government have decided to unveil court fee increases. I must not show too many of my grey hairs, but I can recall the court fee being 10 for the writ. I remember it rising to 50 and then to 100. I see from the Law Society Gazette of 20th March that, as from 3rd April, if anyone wishes to commence proceedings in the High Court, the proposed increases will mean that the fee will be 500. The Government intend that the court fee for a claim of more than 100,000 within the High Court jurisdiction—say, by someone with a disability who has been injured in an accident—will now be 700. That will be the cost of simply starting the process. One hopes that under the reforms of the Lord Chief Justice, the noble and learned Lord, Lord Woolf, there will be the

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normal pre-action protocols. But if the proposals go through, the cost of issuing the writ will now be 700, and if the claim happens to be above 150,000, it will be 800.

I ask the Government to reconsider. There is no doubt that, as the Civil Justice Council points out, this will lead to a denial of access to justice. I hope that that will no longer be the case following the passing of the amendment. In these amendments—in particular, Amendment No. 132A but also in Amendments Nos. 132B and 132C—we give the Government a menu of options. Indeed, we are from the Opposition and we are here to help the Government. They can choose any one of these three amendments.

The first—Amendment No. 132A—would exclude the recovery of costs other than recurrent running costs. It is a very sensible amendment proposed by a number of outside bodies. Amendment No. 132B would seek to exclude from this new power for the Lord Chancellor to set fees the recovery of judicial salaries and the cost of accommodation. We are aware that problems have been raised by the Royal Courts of Justice, and those have to be dealt with. I hope that the Government will be able to engage in the widest possible consultation and a proper and open debate about the issue of the Royal Courts of Justice and about whether a level of 100 per cent recovery is appropriate and defensible. If it is not, what should the percentage of recovery be, and is it a percentage that will change over time?

The final amendment—Amendment No. 132C—would lay down that:

    "The Lord Chancellor may not under this section seek to recover judicial salaries".

I hope that this will be the most acceptable of the amendments. The provision of judges is a social function. It should not be borne only by those who choose to commence proceedings and are required to pay court fees.

I hope that the Government will consider having a meeting with the Civil Justice Council. I understand that there has been no meeting on this matter, but the Minister will be aware that the council issued a very clear report on it seeking a reversal of the policy. The Civil Justice Council, chaired by the Master of the Rolls, is an important body on which sit leaders of civil justice in all its forms. I believe that they deserve at least a meeting to debate and discuss this policy. In the mean time, I beg to move.

Lord Thomas of Gresford: We on these Benches support the amendments for the reasons very cogently put forward by the noble Lord, Lord Hunt of Wirral. The Minister may recall that at our last Committee meeting I raised the question of whether the fees would be set at a level such that those who could pay would be subsidising those who could not. Following that, she wrote to me on that topic. As I understand it, the Government are saying that that is not the principle upon which the fees will be apportioned. I should be

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grateful if the noble Baroness could repeat that assurance this morning in open court, as it were, before the Members of the Committee.

Baroness Scotland of Asthal: I intend to deal with all three amendments in responding to the noble Lord, Lord Hunt. The effect of these amendments, none of which are consequential on each other, would make it a statutory requirement that the Lord Chancellor should have regard when prescribing fees to the need: first, to recover only the recurring running costs of the courts, which is Amendment No. 132A; secondly, to exclude judicial salaries and accommodation costs, which is Amendment No. 132B; and, thirdly, as in Amendment No. 132C, to exclude judicial salaries alone. I thank the noble Lord, Lord Hunt, for his attempt to assist the Government in this regard, but I shall decline his invitation.

A statutory provision that excludes judicial salaries and accommodation costs from recurrent running costs would be an undesirable fetter on the Lord Chancellor's powers in exercising his ministerial responsibility to set fees; it would understate the true cost of the service; and it would require a significant proportion of business-related cases being subsidised by the taxpayer.

Subject to subsidies to protect access to justice, the Government's policy is to recover through fees the cost of civil court services, which includes judicial salaries and accommodation costs. That approach is based on the general principle that it is reasonable to expect that those parties who can pay should meet the cost of that part of the civil justice system they are using in order to resolve their dispute. The policy of recovering most of the costs of the courts through fees ensures the best targeting of scarce public resources. These are public expenditure decisions for the Government.

First I shall deal with specific points raised by the noble Lord, Lord Hunt. The Committee will remember that accommodation costs were first included in costs recovery in 1982. In 1992 the noble and learned Lord, Lord Mackay of Clashfern, the then Lord Chancellor—whom I see is sitting in his place—agreed it was anomalous that judicial salaries should not be included. The introduction of accruals accounting across government has brought in capital charges for property which reflect the true cost of services. This principle and approach is now in its 11th year, so it has been established for some time.

The civil courts are funded appropriately. The Government showed their commitment to ensuring that citizens can access and enforce their legal rights or have their obligations determined by an independent tribunal by enshrining the European Convention on Human Rights in the domestic Human Rights Act.

Last year—2001–02—the Government funded civil and criminal legal aid in the sum of 1,717 million. The total cost of running the criminal and civil courts was approximately 1.1 billion. In fairness to the taxpayer, there is no reason why court users who can pay should not pay for the cost of the civil courts service which

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they are using. We are not talking of those who cannot pay, or, as the noble Lord suggested, the disabled, who may very well have the advantage of legal aid. The noble Lord will know that legally-aided applicants do not pay fees; they are paid by the Legal Aid Fund.

I am happy to repeat what I said in my letter to the noble Lord, Lord Thomas of Gresford. We do not recover "full" cost as the policy of protecting access to justice also applies. The Government funds those receiving exemptions and remissions and the family proceedings subsidy and not other fee-paying litigants. The Government's policy is normally to recover the full cost of government services but Ministers can agree exceptions, as for the civil courts. Recovering the full or partial cost of services ensures the best targeting of scarce resources. So the noble Lord is absolutely right to say that that is the Government's position. I am very happy to reiterate that for the purposes of the debate.

The noble Lord, Lord Hunt, touched on the recent fee increase. The overall increase is under 12 per cent. It is the first increase since April 2000. Some fees have remained unchanged since 1999. Over the three-year to four-year period the annual increase is between 3 per cent to 4 per cent. Without increases a 30 million budget shortfall is projected for 2003–04.

These are important and difficult issues. We think that the Government have struck the proper balance in assisting those who cannot pay and in cushioning them, as I described when last we were in Committee. But those who have the means—and noble Lords will remember we touched on the work in the commercial Court where litigants have those means—should pay and pay at a proper rate. I invite the noble Lord to withdraw the amendment.

11.15 a.m.

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