The government is reportedly set to confirm claimant lawyers’ worst fears by raising the small claims limit five-fold and slashing damages for ‘minor’ whiplash injuries.

BBC Radio's You and Yours programme reported this lunchtime that it had been given details of the long-awaited followup to last year’s autumn statement, in which the then chancellor George Osborne unveiled plans to raise the limit in the small claims court for all personal injury claims from £1,000 to £5,000.

Osborne also proposed a ban on general damages for whiplash.

You and Yours said it was told by the Ministry of Justice this morning that there will be a ‘public consultation in advance of new laws’, with the government blaming a ‘predatory claims industry’ for ‘minor, exaggerated or fraudulent claims’ that have driven up the cost of motor premiums.

The programme reported that the government will propose capping compensation for minor injuries suffered in a car accident at ‘just over £400’; and that ministers also want to introduce a ‘transparent tariff system’ for more significant injuries. It also reported that the government is planning to raise the small claims limit for all PI claims to £5,000, as Osborne indicated.

Speaking on the programme Brett Dixon, vice-president of the Association of Personal Injury Lawyers, described the proposals as ‘heavy-handed and excessive’.

He added: ‘What you end up with in the small claims court where you have an insurer on the other side is that you are left alone in that room without representation and your opponent does have legal representation.

‘That leaves an injured person three options: represent themselves and hope that they are treated fairly by everybody; to pay for legal representation out of their damages, which if it’s reduced causes more of a problem; or simply not proceed and make a claim against someone who has negligently caused them an injury.’

MoJ set to impose £5k small claims limit