At the beginning of this week, the Daily Mail reported that the Labour Party is cashing in from ambulance chasing personal injury solicitors.
The story says that the political party rakes in hundreds of thousands of pounds commission from links to no win no fee lawyers. Every time it refers someone seeking personal injury compensation to an accident solicitor, the party receives £250 + VAT.
Furthermore, the newspaper reports that Labour Party officials have received direct donations in excess of £350,000 from personal injury lawyers who chase no win no fee claims.
The Labour Legal Services website, an official Labour Party site, has a section that guarantees personal injury claimants 100% of any compensation they are awarded. It is worded in a similar way to the adverts we regularly see from ambulance-chasing firms. At the bottom of the web page, a note explains that claims are not dealt with by Labour Legal Services and will be forwarded to a legal firm based in Derby. It also acknowledges that the Party will receive the referral fee for each instruction the Derby firm accepts.
Government ministers have now accused the political party of operating a ‘referral fees racket’.
It has been estimated that a ban on referral fees could save motorists as much as £150 a year on their car insurance premiums. Taxpayers also suffer when people make spurious personal injury claims against their local council for trips and falls on pavements and other minor accidents.
Labour did not back the coalition’s recent plans to do away with referral fees; hardly surprising the Conservative Party says in light of this latest revelation.