Ministers are working on a total overhaul of the ‘outdated’ system of clinical negligence compensation within the NHS, it was revealed today.

Health minister Nadine Dorries told the health and social care committee that a review of the system was going ‘at pace’ and could involve all claims against the NHS.

The evidence session discussed ongoing safety concerns with maternity services in England following incidents at East Kent Hospitals University Trust and Shrewsbury and Telford Hospital NHS Trust.

Asked by committee chair and former health secretary Jeremy Hunt about the prospect of a no-fault compensation system, Dorries indicated that progress was ongoing about major changes to the current process.

She said: ‘I can’t be drawn on the detail but we are looking at, in the round, across the NHS, not just in maternity, about how those issues of no blame, no-fault compensation, clinical negligence, how they are treated and how they are dealt with and how we look at them, and we administer them. So there is work, a review taking place, and it was discussed as part of the spending review that we look into this.’

Hunt further asked whether it was ‘morally justifiable’ that the disabled child of a banker would get more compensation than the disabled child of a cleaner, Dorries responded: ‘Absolutely not.’

She said: ‘These are outdated practices, [an] outdated system… the whole system is under review at the moment.’

Hunt said the committee had previously heard evidence about Sweden's successful system of no-fault compensation, where families did not have to prove negligence before they could receive damages but instead had to prove avoidability and that something went wrong.

Dorries said: ‘There is some evidence that Sweden’s harm rates in maternity are lower than ours but there could be a number of reasons for that.’

Although Dorries appeared keen to reform the system, it is now almost a year since the government’s House of Lords health spokesperson Lord Bethell said current arrangements were unsatisfactory and that a review would be published shortly.

Stephanie Prior, head of medical negligence at London firm Osbornes Law, said the review of the current compensation system ‘cannot come soon enough’.

She added: ‘Families are often coping with the demands of looking after a brain injured child and are not always emotionally ready to pursue a claim and when they do those who earn more often get a higher level of financial settlement. This is grossly unfair and needs to be changed completely.'