New bid to curb greedy lawyers

Ministers today tried to slam the door on the sky-high cost to society of "compensation culture".

New laws were promised in the Queen's Speech to stop lawyers encouraging people to sue for everyday mishaps or perceived slights.

The aim is to halt an avalanche of spurious claims for alleged accidents or injustices. Recent controversial cases have included a payout of ?3,500 to the parents of a Girl Guide who singed her fingers cooking sausages.

In another case a school ordered children to wear goggles to play conkers in case the school was sued.

Ministers are shocked at the impact of the threat of litigation, ranging from the cancellation of school trips to ballooning legal bills for the NHS and the armed forces.

Compensation payouts are said to total ?10 billion.

In London alone, there was a big rise in payouts by hospitals last year, from ?24 million to ?32 million. Nationally, schools paid out ?200 million in 2003. "If people are scared they are going to be sued, that makes them risk-averse, and that is bad for society," said a spokesman for the Lord Chancellor, Lord Falconer, who is behind the move.

Officially, the Government denies there is a genuine problem of compensationchasing - only a " perception" among people that they could be easily sued.

A report by the Better Regulation Task Force last summer argued that the compensation culture was a myth.

It said that the number of personal accident claims fell by 60,000 last year while costs for human-rights breaches were 0.6 per cent of GDP - less than the European average. Instead, Lord Falconer's officials talk of "combating the perception of a compensation culture". A new Compensation Bill will be published within months to crack down on the worst abuses.

It will impose new regulations on law firms specialising in conditional fee arrangements, where clients can sue without running any risk of paying costs.

The common law on negligence will be overhauled so that nobody can be sued unless they are genuinely at fault. A new NHS Redress Bill will stop most medical mishap claims from going to court at all.