HC Deb 16 October 2003 vol 411 cc254-5
11. Lawrie Quinn (Scarborough and Whitby)

If he will make a statement on the impact of insurance premium levels on the service sector of the economy. [132066]

The Financial Secretary to the Treasury (Ruth Kelly)

I am aware that increases in insurance premiums in the past few years have had an impact on many sectors of the economy, including the service sector.

Lawrie Quinn

My hon. Friend knows that three quarters of the British work force work in the service sector. Does she share my concern that employers' liability insurance is due for much needed reform? Given that the relevant legislation was enacted in 1969, is not it time that she encouraged her colleagues in the Department for Work and Pensions to consider the important subject of insurance?

Ruth Kelly

I know that my hon. Friend takes a great interest in employers' liability insurance. Indeed, he tabled a ten-minute Bill on the matter. Surveys show the importance of developing enforcement procedures to ensure that everybody has compulsory employers' liability insurance in place. We are therefore determined, as part of our review of employers' liability insurance, to develop a comprehensive database to ensure that we have full records of firms' procedures. We are also reviewing the current fines system to ascertain whether legislation or regulation is needed.

Chris Grayling (Epsom and Ewell)

Is the Minister aware that the situation in regard to employers' liability insurance will be made worse by the Government's latest stealth tax, in the Health and Social Care (Community Health and Standards) Bill, which will allow charging to take place for health care when it is related to a court settlement? Will the Minister work with her colleagues in the Department of Health to ensure that the implementation of this measure does not have the effect—which it could have—of further increasing employers' liability insurance and forcing more businesses closer to the wall?

Ruth Kelly

The hon. Gentleman will be aware that any system of employers' liability insurance needs to be fair to all parties—to employers, to insurers and, of course, to employees who are injured as a result of an employer's negligence. We are aware of the pressure on the system, which is why we have commissioned this wide-ranging review, and it has already come up with many concrete proposals that are improving the situation. We must also ensure that, in future, all legislation is carefully scrutinised to maintain the pressures on the system at a minimum.