The Queen’s Speech unpicked

We take a look at some of the potentially significant reforms introduced in the Queen’s Speech.

The Queen’s Speech was much-derided as lacking in content, seen as indicative of a government paralysed by the referendum on EU membership. However, now that the dust has settled, it is clear that is not entirely fair on Her Majesty’s Government. In several sectors, the government has introduced some potentially significant reforms which we look into in more detail in this briefing.

Driverless cars
Not just the stuff of science fiction, the Government is keen to ensure that the UK is magnet for investment for innovative technology. This week, Transport minister, Andrew Jones, gave a further indication of what might be contained in this Bill when it is published. The government has put a timescale on the technology development, setting out that it believes that “within four years it will be possible to buy cars that, under supervision, park on their own  and pilot themselves on motorways” – in fact, cars that can park themselves are already a reality.

The Government’s principal driver is an improvement in road safety, citing that more than 9 in 10 road fatalities are caused by human error. Additionally, it offers the opportunity for those who are unable to drive to do so, and potentially even offers us the opportunity to read and pursue other activities on our journeys!

However, it does raise interesting challenges for the insurance industry. In an era of big data, this poses major opportunities for the industry in terms of assessing vehicle behaviour. Crucially, for the insurance and automotive companies, manufacturers will be liable in the event of a collision when a car is in driverless mode, with the insurer being able to seek compensation from the manufacturer if a fault is found. Of course, this raises all manner of questions with respect to two driverless cars colliding or even what would happen if a driverless car was forced to collide to avoid a potentially more dangerous collision.  As an extension of the current system by which a driver must be insured, a driverless car must also have insurance.

Better Markets Bill
The bill, designed to empower consumers, will contain measures to enable easier switching of services.  Sajid Javid has begun setting out some of the measures that we are likely to see, which include ”proposals for a 7 day period within which people can switch providers across a range of key services, and exploring what more can be done to give consumers the power to compare products and switch quickly”. In the energy market, this builds on the Competition and Market Authority’s proposals to make it easier for companies to switch suppliers.  In some markets, this process is relatively streamlined. In others, for example switching mortgage provider, speeding up the process could involve major disruption for the businesses involved.

It will also contain proposals to promote completion and open up markets in the UK, which will likely see measures designed to improve the efficiency of the CMA and beef up its powers of enforcement. This is likely to be an attempt to address recent criticism that the CMA lacks teeth, especially in regard to its proposed reforms to the banking sector.

Digital Economy Bill
The Digital Economy Bill attempts to address criticisms of George Osborne that his reforms to the UK economy have not delivered an improvement in productivity and as traditional industries decline Britain needs to find a new way to boost economic growth.

Some aspects are on a similar theme to the Better Markets Bill and will contain measures to make it easier for consumers to switch providers, with Ofcom given new powers to coordinate the switching process. Ofcom will also be given powers to order companies to release data on service levels. Culture Secretary, John Whittingdale has also stated that consumers will have the right to “automatic compensation” when “things don’t go right”.

Fast broadband connection, a theme championed by this government, and in particular Ed Vaizey, will be made into a Universal Service Obligation and would set a threshold above which only the most remote properties would have to contribute to the cost of installation. This is a cause long championed by Conservative members representing rural seats and cements the status of broadband as a basic utility in the 21st Century. Speeds of 10 Mbps is the initial expectation but Ofcom will be mandated to systematically review this. The government had actually announced this in November 2015 with a consultation already underway by Ofcom. What, amongst other things, is not yet clear is who the USO will rest upon; Ofcom has suggested it could be one provider (as in the landline case which resides solely with BT) or could be split amongst others.

The government is championing digital infrastructure investment although, in relation to 5G network, Chair of the National Infrastructure Commission, Lord Adonis warned this week that “We will need the right regulation so that the market is allowed to flourish and we will need to ensure that the UK has the skills not only to deploy the infrastructure but to make use of It”.

The Bill will be very wide ranging and in addition to measures aimed at the consumer will also help brand holders by addressing the disparity in copyright law for online and offline media and encourage a more open approach to publicly held data.

As ever, the devil is always in the detail. Whilst this year’s Loyal Address did not announce any swinging reforms, it still contains a number of measures that will potentially impact a number of sectors in significant ways. Of course, with a small parliamentary majority, a minority in the Lords and a fair few backbenchers wanting blood, no one can guarantee the easy passage of any legislation.