HL Deb 13 February 2003 vol 644 cc810-2
Lord Hurd of Westwell

asked Her Majesty's Government:

What progress has been made on the referral of government disputes to mediation or arbitration since the report of the Lord Chancellor's Department in July 2002.

The Parliamentary Secretary, Lord Chancellor's Department (Baroness Scotland of Asthal)

My Lords, our department issued a report on the effectiveness of the pledge in July 2002 which said that, in the financial year April 2001 to March 2002, alternative dispute resolution methods had been used or attempted in 49 cases. I am pleased to report that, on the material collected by my department, so far in this financial year that figure has increased to 255. Progress on this scale clearly demonstrates that the pledge marks a major step on the road away from a culture of litigation towards a culture of settlement. The next full report is due to be issued in May 2003.

Lord Hurd of Westwell

My Lords, I thank the noble Baroness for that rather encouraging reply and declare an interest as chairman of CEDR which is a charity active in encouraging mediation. Has she seen the professional actuary's report, which had a good deal of publicity just before Christmas, which suggested that the compensation culture in this country is now costing the country £10 billion a year with a particular burden on the National Health Service and 35 per cent of that—more than a third—goes not in compensation at all but in lawyers' fees and administrative expenses? Given that rather frightening prospect, can the noble Baroness and her noble and learned friend the Lord Chancellor bring their strong persuasive pressures even more to bear in the public sector, particularly on the Ministry of Defence and the National Health Service, to find ingenious ways of settling disputes before they get bogged down in long, expensive and bad-tempered litigation?

Baroness Scotland of Asthal

My Lords, I entirely take on board what the noble Lord said. I reassure him that we are doing everything within our power to make sure that the benefits of mediation are properly highlighted. I have some success stories which I hope will salve the noble Lord's troubled spirit. For example, last year the Home Office resolved a complex and long running dispute involving a non-departmental government body with a two-day mediation, with a saving to the Home Office of about half a million pounds. The Ministry of Defence reached an agreement over the claims for the Kenyan tribes people bereaved or injured by British Army explosives left on their land. That issue had been in dispute for two years but, following a two-day mediation in London, the Ministry of Defence agreed to pay a £4.5 million settlement. The benefits are very clear and are well understood. The Government are doing everything they can to make sure that all departments take good advantage of this opportunity.

Lord Henley

My Lords, like my noble friend Lord Hurd I also declare an interest as regards CEDR, the body of which he is chairman, although my relationship with that body is not quite so eminent as his. Although I welcome what the noble Baroness said about the growth in government sponsored mediation, does she not agree that further growth in that regard would result in considerable savings to the Exchequer in terms of the costs of litigation? I refer to government departments in general but in particular to the Lord Chancellor's Department, which I imagine is very cash-strapped at the moment.

Baroness Scotland of Asthal

My Lords, I thank the noble Lord for his final comment and his concern in regard to our resources. I accept absolutely that there are benefits to be gained from mediation. The Treasury Solicitor's Department estimated that overall savings of £½ million were gained through the use of alternative dispute resolution in the very first year of operation in relation to the 49 cases that were attempted or undertaken. There are real benefits to be gained as a result of this initiative; we certainly seek to reap those benefits.

Lord Goodhart

My Lords, the report to which the Question refers mentions also the use of mediation by the National Health Service litigation authority. It mentions that as at the end of April 2002, 77 offers for mediation had been accepted. Does the noble Baroness agree that that is a particularly important field for mediation and can she report any further progress in that regard?

Baroness Scotland of Asthal

My Lords, I am happy to say that the noble Lord is quite right in terms of the take-up by the Department of Health. I understand that work is progressing well and that there is a full understanding of the benefits of using mediation wherever possible where the parties will engage in it. I understand that there is an ongoing review on how mediation can better be used.

Baroness Buscombe

My Lords, the Government will be aware that in November 2002 Nabarron Nathanson published ADR and Local Government, the findings of a research study into the use of alternative resolution and mediation within local government. The implication of the report is that there is a clear lack of mediation training and a pressing need for accredited mediators within local government. Can the Minister tell us what the Government can do to encourage local government to address and rectify that problem?

Baroness Scotland of Asthal

My Lords, one of the things that we can do is to raise the issue, as we have done, right across the sector. Noble Lords will know that we have said that we shall attempt to make sure that there is such a provision in all our contracts. Good practice is being shared. Obviously we hope that local authorities will seek to take advantage of alternative dispute mechanisms in order to reduce the cost to themselves.