Motor Vehicles (Compulsory Insurance) Bill — House of Lords, 2022-03-18
Topic: Transportation
Andrew Robathan (Conservative, Centre-right): My Lords, this is a very straightforward Bill and I trust that it will be uncontroversial. It was introduced in the other place by my honourable friend for Wellingborough, Peter Bone, but there was, before that, an excellent debate—which I commend to anyone who wishes to read it—in Westminster Hall on 22 September last year, which was led by my right honourable friend for Chipping Barnet, Theresa Villiers, whose speech I will refer to extensively The essence of the Bill is that it removes EU rules that were created by an ECJ judgment in the Vnuk case. For background, if I might explain, Mr Vnuk was the victim of an accident involving a reversing tractor inside a barn in a farmyard in Slovenia. He took his compensation claim to the European Court of Justice. In the United Kingdom, an incident of this nature would be covered by our compulsory employers’ liability insurance regime, but not all EU member states have such a scheme to protect employees in the workplace In its 2014 judgment, the ECJ therefore shoehorned Mr Vnuk’s compensation claim into the EU’s motor insurance law. In so doing, it extended the scope of compulsory motor insurance to accidents on private land involving a very broad range of vehicles—essentially, anything with wheels and a motor that does not run on rails, no matter where it is used or for what purpose. This is, of course, manifestly different from the compulsory motor insurance requirements in the Road Traffic Act 1988, which applies to all vehicles that are permitted to be used on our streets and roads The UK’s approach to compulsory motor insurance has been consistent since the 1930s. It is proportionate and it works. However, Vnuk had direct effect in EU law, which means that it forms part of the retained EU law that we imported on to our domestic statute book via the European Union (Withdrawal) Act 2018. As a result of cases in the UK courts, such as Lewis v Tindale, the UK’s compensation fund for people injured by uninsured drivers will now be obliged to pay out in the circumstances covered by the Vnuk judgment. For those who are not aware, the UK compensation fund is covered by the Motor Insurers’ Bureau, to which I am grateful for its advice. Every driver who takes to our roads funds the scheme through his or her motor insurance premiums The combined effect of the Vnuk and Lewis cases and the 2018 Act is that the scheme now has to bear very significant costs for which it was never designed, and motorists are of course left picking up the bill. Let us be clear: we are talking about accidents on private land, in private gardens, in farmers’ fields, on golf courses, inside supermarkets, banks and offices—the list is long. These are places where what has happened, or even the fact that anything that has occurred at all, will often be difficult to establish with any clarity, which gives rise to worrying opportunities for fraud Now, if this ruling stands, the Government Actuary’s Department estimates that the annual costs to the Motor Insurers’ Bureau—and, therefore, to every driver in the country—could rise to over £2 billion. This equates to £50 on every vehicle insurance premium. Probably, of course, it would be more on younger drivers, who are seen as a bad risk This situation, and the ruling, have been heavily criticised. The EU is currently changing the rules—it is in the period of, I think, two years in which it has to change them—and changing the law, and the European Parliament’s rapporteur described the case’s consequences as "absurd overregulation". It is a huge irony that we in the UK, having left the EU, are still stuck with a piece of law that the EU has changed. This is because it is now part of the retained EU law at the end of the transition period. It is an unfortunate and probably rather foolish omission on behalf of the UK Government This Bill puts that right. I want to be clear that this current law—the Vnuk law—covers mobility scooters, golf carts, sit-on mowers, quad bikes, the lot. I mention the last because a Conservative MP was fined a decade or so ago for driving his quad bike 100 yards along a public road, so the law works. He had no insurance; he was photographed by hunt saboteurs and prosecuted—I will tell people who it was if they want to ask me later I repeat that employers’ liability insurance is compulsory. As a farmer, for instance, I have third-party liability insurance, as do almost all farmers and as do golf courses and people like that. This Bill restores the situation, the status quo ante, before the Vnuk judgment. Various road traffic accidents will determine the insurance requirements. If we wish, at some stage, to determine that change is needed in the future, that will be achieved by proper legislation properly considered by Parliament. The Bill was not opposed, nor amended, in the other place. It has the support of the Government and, as I understand it, of the Opposition. Indeed, I shall close with the comments of the honourable Member for Bristol East—Kerry McCarthy, the shadow Minister for Transport—from 22 September: "we have operated under the scheme set out in the Road Traffic Act for many decades. It is proportionate and it works."—[Official Report, Commons, 22/9/21; col. 181WH.] I beg to move.