By Matthew Best, Director – ATE Partnerships, Head of Personal Injury & Clinical Negligence
(Estimated reading time: 5 minutes 22 seconds)
In the interests of full disclosure – this article includes some AI-generated research content. This enabled us to widen the scope slightly in what we’ve commented on below. We then reviewed the content, checking for accuracy and consistency with our previous views.
You may have seen this article in The Law Gazette clinical negligence going in wrong direction – NHS review finds, which was published following a government commissioned review led by Lord Darzi. At first glance, it seems like a balanced report but dig deeper and you’ll notice it paints a worrying picture for stakeholders in the UK clinical negligence sector, including claimant solicitors, ATE insurance providers, and defendant bodies such as NHS Resolution.
Although the report highlights that NHS clinical negligence claims are now the largest liability on the government’s balance sheet, second only to pensions and nuclear decommissioning, it also underlines that the £2.9 billion spent annually on such claims constitutes only 1.7% of the total NHS budget.
This is a substantial figure, but perhaps not as alarming when placed in the context of the broader NHS financial challenges. Interestingly, the report does not point to lawyers or legal costs as a primary concern. Instead, it emphasises repeated mistakes in the health service— failures that, if avoided, would reduce the number of claims to begin with.
NHS Learning from its Mistakes: A Missed Opportunity?
The issue of whether the NHS learns from its mistakes is not new. As early as January 2022, under the previous Conservative government, the Health and Social Care Committee began discussing this very issue. It seems this discussion has now reached the front of the queue with the new Labour government. Despite this, the focus remains on quick, cost-saving measures like fixed recoverable costs (FRC) for lower-value claims, rather than addressing the root cause of the claims: clinical errors and negligence within the system.
Starmer’s recent declaration of “no extra funding for the NHS without reform” further signals that the introduction of FRC for clinical negligence claims valued under £25,000 could be fast-tracked. Many claimant solicitors fear that this will create a significant barrier for patients seeking justice for lower-value claims, where costs could make such claims financially unviable for legal practices to pursue.
The overarching concern is that the focus on cost reduction may eclipse the need for systemic learning within the NHS itself.
Health and Social Care Committee: Its Role and Outlook
The Health and Social Care Committee, although independent of the government, has a crucial role in scrutinising NHS operations and policies implemented by the Department of Health and Social Care. With the Labour government now in power, the committee is expected to work on an accelerated timeline. Labour’s health manifesto promises structural reform but also highlights efficiency, implying potential regulatory changes in legal processes around NHS negligence.
However, claimant solicitors and stakeholders in the clinical negligence sector are apprehensive. Will these changes target the efficiency of claims management, or will they focus on preventive measures within the NHS to reduce clinical errors? Lord Darzi’s review appears to sidestep this question, focusing instead on overall NHS inefficiencies and waiting times, without offering specific guidelines on how the NHS can better learn from its mistakes.
Fixed Recoverable Costs: A Looming Challenge
The potential introduction of FRCs, a key proposal from the Conservative government, appears likely to continue under Labour, particularly as Starmer is emphasising financial prudence and efficiency. Claimant solicitors and ATE insurance providers have long voiced concerns that such a measure would disproportionately affect access to justice for patients with lower-value claims, particularly those that are more complex and costly to investigate, even if the compensation sought is modest. These stakeholders argue that fixed costs could lead to a twotier system where only the highest-value cases receive adequate attention, leaving many patients without recourse to justice.
Conversely, defendant bodies like NHS Resolution have been supportive of fixed recoverable costs, seeing them as an essential tool for controlling litigation costs, which they argue are spiralling out of control. NHS Resolution, already grappling with the growing cost of negligence claims, advocates that FRC will prevent legal fees from overwhelming the system. Yet, critics point out that this view fails to address the underlying issues causing negligence claims in the first place—mistakes and errors that could be prevented through better NHS practices.
Labour’s Reform Agenda: What Can We Expect?
Keir Starmer’s statement about NHS reform being a prerequisite for additional funding hints at an era of deep structural changes. His emphasis on long-term reform includes a 10-year plan aimed at revamping how the NHS functions at its core. For clinical negligence stakeholders, this could mean tighter regulation, streamlined processes for claims, and an ongoing push for cost-cutting measures like FRC.
But reform does not happen in isolation. Labour’s health policies also emphasize improving access to general practitioners, increased community care, and better regulation of NHS managers. These changes could, in theory, reduce the number of claims, but only if they successfully address the NHS’s failings. For claimant solicitors and ATE insurers, the concern is that these systemic reforms may take too long to impact the flow of negligence claims, while immediate cost-cutting measures like FRC could undermine access to justice for claimants.
Conclusion: The Path Forward
Lord Darzi’s report has certainly stirred debate, but it leaves many questions unanswered for stakeholders in the clinical negligence sector. While the report highlights the financial burden of clinical negligence on the NHS, it doesn’t fully grapple with the need for the NHS to learn from its mistakes—a point previously raised and seemingly shelved until now. As Labour’s government pushes forward with reforms and cost-saving measures, the introduction of FRC seems inevitable, raising concerns for claimant solicitors and ATE providers who see it as a barrier to justice.
The real challenge lies in ensuring that these reforms are balanced with measures that not only reduce costs but also foster an NHS that learns from its failures, ultimately reducing the very need for litigation. Whether Labour’s reforms will manage to strike that balance remains to be seen.
In the meantime, stakeholders must prepare for significant changes to the claims landscape and advocate for reforms that protect access to justice, while working towards a more efficient and error-free NHS. With that in mind, it will be important to stay informed, adaptable and prepared for the challenges these changes will bring.
Here at Temple we are committed as ever to keeping you informed on these developments. Please call Matthew Best on 01483 514804 or email with your observations on this topic or to discuss your ATE insurance requirements.
Matthew Best Cert CII
Head of Personal Injury & Clinical Negligence
Matthew Best Cert CII
Matt has an insurance background and joined Temple in 2011 having worked for 4 years in a leading insurance company where he was dealing with personal injury work. Matthew was promoted to Underwriting Manager and subsequently Senior Underwriting Manager taking on overall responsibility for Temple’s personal injury and clinical negligence underwriting department.
In 2022 Matt joined the board of directors as Director of ATE Partnerships. Matthew has cultivated fantastic relationships with our business partners for many years. His ability to build a clear understanding of their requirements and more importantly what is required to fulfil such requirements means he is ideally placed to support the strategic direction of the company.
Matt remains the head of the personal injury and clinical negligence department and is committed to all Temple’s business partners in order to deliver the highest level of service they expect. He is also responsible in making sure that Temple’s ATE and disbursement funding products remain competitive, but most importantly that they are fit for purpose for solicitors and their clients.
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