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It’s no accident, claim the Tories, that Labour don’t want referral fees banned

28th October 2011

It has emerged that the Labour Party website directs supporters who have suffered a personal injury accident, such as a slip, trip, or whiplash accident, to an affiliated site known as Labour Legal Services. In turn, this site advises accident victims to seek personal injury compensation through a Derby firm of solicitors.

According to a note on the site, the law firm will pay a referral fee of £250 plus VAT to the Labour Party each time they are instructed to represent a claimant who comes to them through Labour Legal Services.

As widespread criticism of the payment of referral fees in personal injury claims has emerged, and the practice has been largely blamed for huge increases in the cost of car insurance, the Ministry of Justice recently announced plans to ban referral fees paid to insurers who pass on details of car crash victims to interested third parties.

Mr Djanogly told the Daily Mail, “It is no wonder that Labour won’t fully back our proposals to abolish referral fees when they are exploiting the current system to fill their own party coffers at everyone else’s expense.

“Hard-working people are paying the price for Labour’s shameful insurance racket.”

And when reports suggest that referral fees have added a total of £355,629 to party funds over the last decade it is easy to see why some say that it is the vested interested of Labour front benchers which have caused them to remain quiet over the issue of reform.

Finally, in an unexpected twist to this story, Jonathan Djanogly recently found himself embarrassed to have to disclose his family’s financial interests in insurance companies and, consequently, a distinct conflict of interests which has forced him to stand down on this referral fee debate.

Personal Injury Blog
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