HC Deb 08 July 1991 vol 194 cc675-6

Lords amendment: No. 3, to insert the following new clause—Exception from requirement of third-party insurance—

  1. (".—(1) Section 144 of the Road Traffic Act 1988 shall be amended as follows.
  2. (2) In subsection (1) (which removes the requirement for third-party insurance or security where £15,000 is kept deposited with the Accountant General of the Supreme Court) for "£15,000" there shall be substituted "£500,000".
  3. (3) After subsection (1) there shall be inserted—
    1. "(1A) The Secretary of State may by order made by statutory instrument substitute a greater sum for the sum for the time being specified in subsection (1) above.
    2. (1B) No order shall be made under subsection (1A) above unless a draft of it has been laid before and approved by resolution of each House of Parliament." ")

Mr. Chope

I beg to move, That this House doth agree with the Lords in the said amendment.

The amendment responds to concerns expressed in the House on behalf of the Motor Insurers Bureau—the guarantee fund, funded by the insurance industry—which provides for the victims of uninsured and untraced drivers.

Ms. Joan Ruddock (Lewisham, Deptford)

I understand that this amendment is the Government's response to pressure from their Back Benchers who tabled amendments on Report, which were not debated.

Have the Government sought simply to increase the sum of money required? It is not clear to us why the provisions should exist at all, and the Minister has not made it clear today. We believe that it would have been better to remove the provision altogether.

Mr. Chope

The Government believe that it is reasonable to allow some organisations—for example, the Automobile Association—to place a deposit rather than have to take out a specific insurance for their risks. That has been the position since 1930, and there has not been a single occasion since when someone operating in that way has not been able to meet his debts. That is the rationale behind the amendment. The sum has not been increased since 1930, and we believe that it is now time to increase it and to take powers to increase it further by affirmative order should that be necessary.

Ms. Ruddock

I am grateful to the Minister for that response. We welcome the fact that the sum has been increased considerably and that powers will exist to increase it further. Given that undertaking, we will support the amendment.

Question put and agreed to.

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