Review of Costs Budgeting Process by Jackson LJ

profile_colin_richmond1 By Colin Richmond


Following the introduction of costs budgeting as part of his wide-ranging package of civil justice reforms, Jackson LJ is now undertaking a review of the process.

He is currently hosting a series of meetings around the country to obtain the views of practitioners as to which aspects of budgeting are working well, which are not working so well, which of the rules may need to be changed and so on.

I attended such a meeting in Leeds today (15th April 2015) and felt it would be useful to summarise some of the points that were raised for Jackson LJ to take away. The meeting was intended to deal with issues arising from the costs budgeting of personal injury and clinical negligence claims only, with other types of claim to be dealt with at separate meetings.

Jackson LJ confirmed that his findings will form the basis of a recommendation paper that he will deliver by way of a lecture on 13th May 2015, with the paper being made available on the judiciary website the following day. His recommendations will then be passed to a sub-committee to consider any possible amendments to the rules. He made clear that any views expressed today were preliminary views only and that his opinion may change once he has completed the review process.

The main points raised regarding budgeting were as follows:

Lack of Consistency Among Courts and Judges

  • There was general agreement that there is a lack of consistency in the way different court and judges at local level deal with costs budgeting. Some judges have embraced the process, whereas others give the impression of being keen to avoid budgeting if at all possible.
  • Some judges scrutinise budgets very carefully, with others taking a much more broad-brush approach, to the extent of simply providing an overall figure for the whole budget on the basis that a party should then divide it among the phases as it sees fit.
  • Jackson LJ suggested that there appeared to be a real need for greater training of judges on the budgeting process.

Lack of Consistency in Initial Directions

  • A lack of consistency as to the orders made by different courts following filing of directions questionnaires was raised as a problem. Some courts apparently require very little to be filed in advance of the first costs & case management hearing, while others require very large amounts of paperwork to be placed before the judge.
  • Jackson LJ suggested that a set of “standard” directions to be used by courts across the whole country in most cases might be useful.

Separate Hearings for Directions and Budgeting

  • The issue of dealing with directions and budgeting at the same hearing gave rise to some concern. There was a general feeling that budgets can only be prepared accurately once the parties know what directions are in place, what disclosure is likely to be required, what experts they have permission to rely upon and so on, with the added benefit that an early directions hearing can allow issues between the parties to be narrowed before budgeting.
  • In relation to this, it was noted that the County Court at Sheffield lists a short directions hearing to begin with (possibly by telephone) with the budgeting hearing then arranged for a later date.
  • Disadvantages to the “two hearings” system were also discussed. There was some concern that setting directions and then leaving a gap to the budgeting hearing would lead to parties simply trying to cram as much work as possible into the “incurred” section of the budget. Jackson LJ mentioned that in cases (not necessarily PI cases) where there may, for example, be a large amount of disclosure, the judge may wish to have one eye on the costs involved in such disclosure when setting directions to ensure proportionality.

Date by Which Budgets Should be Filed


  • The date when budgets should be filed was raised. Jackson LJ initially suggested that, in his view, 7 days before the hearing was appropriate, allowing the parties to file the most up-to-date budgets possible while still having time to try and agree them.
  • Some practitioners felt that 7 days left too little time to come to any agreement and 21 days would be more appropriate. Jackson LJ questioned whether or not 14 days might be a sensible compromise.

Hourly Rates

  • One of the issues that practitioners felt inhibited the agreeing of budgets was difficulty in agreeing the appropriate hourly rates for solicitors, leading to an inability to agree the costs of phases or the budget as a whole.
  • Jackson LJ suggested that a full review of Guideline Hourly Rates may be required, with the possibility of the rates not only taking into account geographical factors but also allowing for the possibility of increased rates by way of a “complexity uplift” in certain cases.

Budgeting Certain Phases Only


  • The possibility of, as a general rule, budgets only covering the case up to the end of a particular phase was discussed, the advantage being that future developments are often uncertain and cannot be accurately budgeted early on, making the revision of budgets inevitable.
  • The disadvantages of this were noted as being a lack of certainty in reserving for defendants, a lack of certainty as to any costs risk for claimants and the likelihood of there being less incentive for parties to make realistic offers to settle as early as possible if they are not aware of the full costs risk of losing at trial.

The timescale for the review to be completed is fairly short. There will clearly be much for Jackson LJ to mull over, although I suspect that at least some (and possibly most) of the issues raised today will be replicated across the country.

I intend to post a further blog once the recommendations are published.


  1. […] Colin Richmond of Zenith Chambers on Review of Costs Budgeting Process by Jackson LJ […]

  2. […] Colin Richmond summarised the points that were raised at a recent meeting with Jackson LJ to discuss costs budgeting in Review of Costs Budgeting Process by Jackson LJ […]

  3. […] the points that were raised at a recent meeting with Jackson LJ to discuss costs budgeting in Review of Costs Budgeting Process by Jackson LJ (April […]

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