HC Deb 28 February 1973 vol 851 cc1665-74

11.37 pm.

Mr. Ted Fletcher (Darlington)

In introducing this Adjournment debate I wish to draw attention to the question of cancellation of log books of written-off motor vehicles.

In 1971, according to police files, 721 cars in the county of Durham were rebuilt and put on the road again after being so extensively damaged in accidents that they were completely written off by insurance companies. On this basis I estimate that about 15,000 cars a year are written off by insurance companies and subsequently rebuilt and sold. The figure given by the Vehicle Builders and Repairers Association is higher. That body suggests that 35,000 vehicles which have been involved in major accidents and have been repaired are put on the road again every year.

The rebuilding of a wrecked car is not illegal, and many of the repairs are carried out by reputable garage owners and the vehicles are then safe and roadworthy. These reputable people are behind me in the campaign to ensure that the disreputable dealer is put out of business

The real problem about which we are concerned is that many of these wrecked cars are patched up in back-street garages by dealers who are more interested in making a fast buck than in gaining satisfied customers. These shady traders cannot afford the expensive equipment which is necessary, the jigs and tools, to make car rebuilding safe. For example, they are unable to reline a badly buckled car, and the axles and steering will probably he out of true. Corroded bodywork is sometimes patched up with glass fibre, and this looks fine for about three weeks and then drops out.

In some cases when the dealer has a car with a smashed front he will cut the front off a similar model that has been damaged at the rear and weld one half to the other. When these cars are sold, often at inflated prices, they are a danger not only to the driver but to all road users. There must be protection against these practices.

About two years ago an intending purchaser of one of these cars knew whether the vehicle had been involved in a major accident because the words This vehicle has been completely written off by an insurance company were stamped on the log book. The system was discontinued about 18 months ago, and, as far as I am aware, no reasons have been given to the House. I understand from a Press statement that was issued by the Department that the system was ended because it was felt that the damaged cars which had been repaired were not a road hazard. So, at the moment no one can know from the log book whether the car has been rebuilt from a write-off or not.

My first question to the Minister, therefore, is: why was the scheme for stamping log books discontinued and why can it not be reintroduced? I realise that this would be only an interim solution to cover the period until the new licensing computer at Swansea is in full operation. In the meantime some consideration will have to be given to a more comprehensive scheme. For example, I should like to see the log book for this type of vehicle withdrawn and reissued only when the office in Swansea had received a satisfactory inspection report from the Ministry's inspectors. That, however, would require amendments to existing legislation, or new legislation, and I cannot pursue that in the course of an Adjournment debate.

The Department is being much too complacent about what I regard as a very serious problem. The Minister informed me in December 1971 that he was setting up a departmental committee to consider the whole problem. On 5th December 1972, I received a letter from him, after submitting one or two questions and corresponding with him, advising me that the Department had come to the conclusion that these reconstituted wrecked cars were only a minor factor in road safety. He admitted in the letter that there were few statistics available to support this view, and he realised, too, that the study of the West Yorkshire police had reported that 2.5 per cent. of the accidents in that area involving personal injury were attributed to cars that had previously been wrecked and put back on the road.

I do not know what 2.5 per cent. of the present level of road accidents is, but it must run into several thousands. But one sample is unreliable, and it seems to me that the Minister has arrived at his decision on inadequate information. He certainly consulted the chief constables, but, because of the absence of the stamp on the log book, reliable statistics are not available.

My request to the Minister, therefore, is to revert to the old system of stamping the log books of write-offs as an interim measure, pending the introduction of legislation that will take away the licence of a write-off until it is certified to the Department's satisfaction to be roadworthy.

There is widespread concern about the present situation. The Vehicle Builders and Repairers Association, the Motor Agents Association and the Institute of Automobile Assessors have been pressing the Department about the matter for many months. They are reputable organisations representing competent garage proprietors with nothing to lose from the inspection of written-off vehicles. They are just as anxious as I am, and as anxious as the Department should be, to put the disreputable backstreet dealers out of business.

When I made a BBC radio broadcast on the problem about a year ago I received letters from all parts of the country. Some of them were heartbreaking. For example, a man in Manchester withdrew his life savings of £900 to buy a Cortina, only 12 months old, to take his invalid wife out into the country. He thought it was a bargain, but after a few weeks it began to drop to pieces. He then discovered that it was a write-off, extensively damaged in an accident.

It is all very well for the Minister to say, as he did in a letter to me, that people should take precautions when they buy a car and should have it examined by a competent examiner. Many people meet fast-talking, plausible salesmen and it is very difficult for them to resist their blandishments.

In the short term we must return to the practice of stamping the log book when a car is written off, and in the long term we must consider how the law can be changed. My whole purpose is to ensure that no sub-standard restorations are allowed to reach the hands of unsuspecting drivers who would be a danger not only to themselves but to other road users. Many thousands of people, particularly those who have bought reconstituted vehicles, will be interested in the Minister's reply to this short debate.

The problem will grow, because the motor trade will have to absorb VAT in the near future. That will mean that the costs of repairs and spares will increase, and, as a result, insurance companies will be writing off even more cars.

I urge on the Minister the policy that I have suggested, but I also draw his attention to the lapse of time since I first raised the matter. It was raised in my local newspaper, the Darlington Evening Gazette, about 15 months ago, as a result of which I received a number of letters from constituents. Having tackled the problem, I was advised that the matter was under consideration by a departmental committee. In response to Questions, I was assured that a report would be available shortly. In fact, we have a report saying that there is nothing to investigate, that there is no problem. I am certain from the letters I have received that there is a problem and that it will continue.

The question is one not only of road safety but of consumer protection. People are entitled to know when they are purchasing a second-hand car whether it has been involved in an accident and been completely written off by an insurance company, and whether it is roadworthy. The Department owes them to duty not only to consider re-introducing the stamping of the log book but to give long-term consideration to changing the law so that all such cars can be inspected by competent people before a licence is issued.

11.50 p.m.

Dr. Reginald Bennett (Gosport and Fareham)

I am sure that the hon. Member for Darlington (Mr. Ted Fletcher) is performing a most valuable function in bringing this matter before the House. It is unduly long in coming before the House because the change in procedure dates from 15 months ago or more. At that time I made some representations to the Department.

I must confess an interest as a member of the Council of the Institute of Motor Auctioneers. I think that the hon. Member for Darlington will probably agree that it is probably the auctioneers who are most at risk in handling cars. They take them as found, and it is only after the cars have been processed and disposed of that investigation may find that the customer has bought something which is not safe and about which nobody knew anything. The whole motor trade, every part of it, is at risk, to say nothing of the public who are destined to be hurt or even killed in these dangerous vehicles that are at present allowed to return to the roads without any apparent sign of their unworthiness.

I would quote rather than paraphrase an inter-office memorandum of one of the motor auction firms of over a year ago. It says: The effect of this new instruction is that it is not possible for anyone to find out for themselves whether the vehicle has been written off or not. The licensing authorities will not tell us when we ask, but when a member of the public or other person applies to tax the vehicle, the licensing authority still send the 'pink form' to the police. The police then simply turn up on the new owner's doorstep and calmly announce to them that the vehicle has been involved in a major accident and has been 'written-off'. They then proceed to inspect the vehicle in case it has been repaired with stolen parts, that is, 'rung'. The new owner throws up his hands in horror and takes the vehicle back to his seller for redress, thus starting a chain reaction in reverse. I have proof of one such vehicle, the salvage of which was purchased by a dealer in Ashby-de-la-Zouch from the Royal Insurance Group with a clean log book. The dealer rebuilt the vehicle and entered it at Measham, stating 'No' to out question, 'Has the vehicle been an insurance total loss?' It was only when a member of the public, the final purchaser, applied to tax it and the licensing authority notified the police on the pink form' that it all came to light. The police are going to visit the present owner. The auction purchaser was in fact a dealer and will obviously lose his profit when his customer rejects the vehicle. I know that it is true that the log book is no document of title. That is a plausible and good argument. But surely we must have some check, before the last minute of the licensing, on the reconditioning of rubbish that is put on the road. The Government are responsible entirely for the deaths of people killed in such vehicles if they do not become more strict. Certainly the insurance companies should carry liability indefinitely for any written-off vehicle. This is a murderous practice, and it is incredible that it should have been allowed, and I implore the Government to do something about it.

11.53 p.m.

Mr. Ernle Money (Ipswich)

I hope that my hon. Friend will be able to reassure those members of the public who have been worried by the suggestion that it might be the intention of his Department to abandon the traditional log book and use some form of yearly certificate.

The Under-Secretary of State for the Environment (Mr. Keith Speed)

I thank the hon. Member for Darlington (Mr. Ted Fletcher) for raising a matter about which he has broadcast and about which I contributed to Motoring and the Motorist some weeks ago

I am sure that every hon. Member and certainly my Department will support the object of keeping dangerously defective vehicles off our roads. It is a problem which is certainly in the forefront of my right hon. Friend's mind and of my mind, and in the Department we are constantly looking for ways and spending a great deal of money in trying to ensure that road safety is advanced, but we must spend money and do things in an effective way, as I am sure the hon. Gentleman would be the first to agree.

The basic problem in considering the whole question of written-off vehicles is that the phrase, unfortunately in practice does not mean what might seem to be implied. In insurance company terms, a written-off vehicle means one on which the insurer has made a total loss payment; but this is not a satisfactory way of defining potentially dangerous vehicles, and that for two main reasons. The first is that the insurer's decision to make a total loss payment now depends on economic factors as well as on engineering factors, and must depend a great deal on the value of the vehicle at the time of the accident; its age, general condition, cost of repair, and so on.

Let me give a simple illustration. If the hon. Gentleman had a 1959 Austin A30 which was involved in an accident, where perhaps the cost of repairs would be £100 and the car was worth only £60, that would be a total loss. But if he had 10-year old Rolls-Royce on which the repairs might be £3,000, the cost of the repairs would be substantially below the then value of the vehicle and there would not be a total loss.

Secondly, total loss payments do not adequately identify all vehicles that have suffered serious damage in accidents, because many of these vehicles are insured only for third party and, therefore, no payment would be made to the owner for total loss——

Mr. Fletcher

I understand that 80 per cent. of insured vehicles are comprehensively insured.

Mr. Speed

The figure that was mentioned earlier was 25 per cent. for third party, but, even so, 25 per cent. is 25 per cent. of about 15 million vehicles, which is an awful lot of vehicles, and I am sure the hon. Gentleman will agree that we are still talking in terms of millions of vehicles.

Some badly damaged vehicles which are comprehensively insured may not be taken in by the insurance company but may be left with the owner with a corresponding reduction in monetary compensation. The hon. Member will know that that has happened to a considerable extent in the past. Therefore, there is really no guarantee if we revert to the system applicable in 1971. Apart from this, it is perfectly possible to make some vehicles fully roadworthy again even after serious damage. It is, as I have already outlined, a question of how much it is worth while spending on the vehicle to get it fit for the road rather than whether it is technically possible to repair it adequately.

For all these reasons, to endorse the log book of a vehicle on which a total loss payment has been made, or cancel it in order to prevent the vehicle being used on the road again, is, as a long-term answer, not a satisfactory means of dealing with the problem from a road safety point of view.

Perhaps I can answer the first question by recalling that a scheme was tried in 1967 under which, when they took in a seriously damaged vehicle which was subject to an insurance claim and on which a total loss payment was made, the insurers notified the local taxation office, which then endorsed the registration book with the words "Seriously damaged vehicle. Insurance total loss payment made." The scheme was suspended in 1971 because of the reasons I have given, and because the insurers told us that it was causing some reputable insurance companies severe financial loss, while it appeared that less reputable companies were faced with the temptation to which they sometimes gave way of leaving the vehicle with the owner rather than taking it in as a total loss in circumstances where failure to notify the local taxation office might be justified by straining at the interpretation of "seriously damaged."

I can tell my hon. Friend the Member for Ipswich, (Mr. Money) that a new form of log book will be coming in with centralised licensing at Swansea. There will be a log book for each vehicle and owner, and when the ownership changes the log book will change with it, providing a particular document for a vehicle and the owner. We shall be advising the House and the public in more detail in due course.

Eventually there will be substantial advantages which will enable us to licence a vehicle from day to day rather than month to month. In consultation with the Home Office and chief constables, my Department has concluded that this issue, while it may be a problem in regard to consumer and other matters, is not a major road safety problem. When I have gone into the figures I hope to carry the hon. Gentleman with me on this.

Various studies in different parts of the world have shown that mechanical defects are responsible for only a small proportion of personal injury accidents. We asked the chief constables and they reported that in only a few isolated instances would the relevant defects have been caused by inadequate repairs to seriously damaged vehicles.

The hon. Gentleman rightly said that there are few statistics available showing the precise extent of the problem. Perhaps I can expand a little upon the answers which the West Yorkshire police gave, because, with respect to the hon. Gentleman, he did not quite interpret my right hon. Friend's letter of December correctly. The West Yorkshire police made a special study and said that in 1971 there were 9,612 accidents in their area involving personal injury. Everyone will agree that is a large number for a reasonable statistical sample. If the hon. Gentleman reads HANSARD tomorrow he will see that he perhaps did not get it quite right. Mechanical defects were reported as a contributory factor in 2.5 per cent. of these accidents.

Mr. Fletcher

The letter actually says: 2.5 per cent. of the accidents in that area in 1971 involved personal injury and in no case was the accident attributable to a vehicle being in an unsatisfactory condition due to a previous accident in which it had suffered serious damage.

Mr. Speed

That is just what I am saying. In no case was it found that the accidents were attributable to a vehicle being in an unsatisfactory condition due to a previous accident in which it had suffered serious damage. This was a thorough investigation. This is the main burden of the evidence that we have when discussing these problems. We must take real cognisance of this study.

It seems that special, complicated measures to tackle this problem cannot be justified on road safety grounds. We deal with the wider problem of checking cars for mechanical defects by making an annual inspection of all cars over three years old compulsory. We very much encourage prospective buyers of secondhand cars to have the vehicle tested before purchasing. The hon. Member mentioned the glib salesman and how a person making a purchase involving £900 can be carried away. Unless a person buying a car is doing so through a highly reputable dealer, giving a cast-iron guarantee, he ought to have the vehicle tested before purchasing.

It is sometimes suggested that garages should be prevented by law from repairing or rebuilding seriously damaged vehicles. This is not a reasonable proposition because with modern equipment and skilled staff it is feasible to restore many such vehicles to a roadworthy condition. In my radio broadcast I said that if anyone can produce substantial evidence that written-off vehicles present a significant accident danger I am prepared to look carefully at that evidence and re-consider our policy. I give hon. Members that assurance. So far no such evidence has come in. On the evidence we cannot see reasons, on road safety grounds, for changing the present policy.

Question put and agreed.

Adjourned accordingly at five minutes past Twelve o'clock.