 |
| Bridget Prentice (bottom left) with, anti-clockwise) Dan Sanzeri Market Intelligence Analyst, Carol Dean and Trish Caldwell, County Safer Communities Manager |
Government minister visits crack claims unit
Government minister Bridget Prentice has visited the only national service to be run by a local authority.
The Burton-based Claims Management Unit is responsible for policing the "no-win-no-fee" claims business. It first became operational in 2006 and is repsonsible for registering all businesses operating in the sector and investigating complaints against operators.
This is delivered by Staffordshire County Council under a contract with the Ministry of Justico. It was recognised recently by the County Council Network as a beacon of good practice, and is now expanding to cope with the huge surge in companies needing authorisation to trade.
"We've been hugely successful in protecting consumers against rogue companies since our inception," said Carol Dean, Cabinet Member for Safer and Stronger Communities. "This visit provided an opportunity to showcase some of the work that has been done and for the Minister to meet the team and hear their experiences of this first year."
Bridget Prentice, Parliamentary Under-Secretary of State at the Ministry of Justice, said: "I am very grateful to the Monitoring and Compliance Unit for the substantial role they have played - both in delivering the necessary infrastructure in such a short time and for their part in helping root out malpractice - the cold calling, inappropriate hospital advertising and misleading use of the term 'no win, no fee' - that made regulation a necessity."
Background to Claims Management Regulation
The headline that Britain is in the grip of a compensation culture is one that has been increasingly reported by the media in recent years and has been identified as a key factor in the increasing aversion to risk that has been demonstrated by both the public and private sector.
The Better Routes to Redress report published by the Better Regulation Task Force in May 2004 made a number of recommendations aimed at targeting the 'compensation culture' myth and ensuring that consumers with genuine compensation claims had accessible routes to obtaining redress.
The government response which followed progressed the recommendations of the Task Force including the proposal that claims management businesses, who act as the middle men between consumers and legal representatives, should be subject to regulation. The result was the Compensation Bill.
Against the background of the Hampton Review of effective regulation, which discouraged the creation of new regulatory agencies, the Department for Constitutional Affairs] had the responsibility for delivering the regulation of claims management businesses. The solution was to invite existing regulators to tender for a contract to deliver effective regulation.
Establishment of the Claims Management Unit
For Staffordshire County Council, and its award winning Trading Standards service, the benefits of tendering for the contract were clear; protecting vulnerable consumers, better regulation of an important market and inward investment for the County; not to mention the prestige of being the first local authority to undertake a national project of this kind for central government. As the service already hosted the Regional Intelligence Unit for the Department of Trade and Industry it was used to adapting and using established best practice, such as the National Intelligence Model, for ensuring effective use of resources in regulating markets.
Following successful tender the Claims Management Unit was established in November 2006. The time period from the signing of the contract to the implementation of the legislation was just a couple of months, during which period suitable premises had to be equipped to accommodate the new team and a completely new IT solution had to be developed to handle applications from businesses applying for authorisation to trade in the new regulated industry. The support of the whole Council, including elected members and colleagues in finance, IT and Human Resources was critical in achieving early success.
By the time of the full implementation of the legislation in April 2007 the Unit was fully operational and had received over 1300 applications for authorisation.
Ensuring effective regulation
Strong performance management from the outset, effective partnership arrangements and a risk based approach to the allocation of resources has ensured that the regulation of the claims management market has had a positive impact.[5]
Five regulatory objectives direct the work of the Unit and provide for an outcome focus to performance management:
· Protecting and promoting the interests of consumers
· Protecting and promoting the public interest
· Improving standards of competence and conduct of authorised persons
· Promoting practices likely to facilitate competition between different providers of regulated claims management services
· Improving access to justice
This, combined with the use of the National Intelligence Model, puts intelligence at the foundation of strategic and operational service planning:
· A Strategic Assessment of the market using intelligence analysis defines priority areas for action based on the risk to fulfilment of the regulatory objectives.
· A Control Strategy sets out guiding principles for the management of the Unit's services based on the priority areas for action and ensures that resources are allocated in accordance with the priorities.
· A continuous review of priorities, performance and risks ensures that the available resources are used effectively and that the Unit is prepared for developments in the market.
Partnerships have been key in the success of the Unit; numerous relationships have been forged at a national level including with the Association of Local Authority Risk Managers, helping to protect local authorities from fraudulent claims, the Insurance Fraud Bureau, to tackle contrived accidents which are believed to support international organised crime, and the Solicitors Regulation Authority, to protect consumers throughout the litigation process.
To date the Unit has authorised more than 1600 businesses to provide regulated services, provided advice to hundreds of consumers on the use of claims management businesses, and achieved success in tackling fundamental problems within the industry including unauthorised leafleting in hospitals for personal injury claims and the use of unfair consumer contracts.
Page Last Modified:
15/05/2008 13:29:45
Back to top