A report says class actions and GLOs could cost Britain £18billion and strangle growth.

13:32, Fri, Mar 6, 2026 Updated: 13:34, Fri, Mar 6, 2026

Erin Brockvich Book Signing

The real Erin Brockovich: What must she make of today's class actions? (Image: Getty)

Like me, you perhaps thought legal “class actions” were all about the little guy heroically punching up, Erin Brockovich style.

Let me disabuse you of the notion. Class actions, and their wretched twin the Group Litigation Order (GLO), seem to have become vehicles for running sketchy litigation aimed at lining the pockets of ambulance-chasing lawyers and amoral fund managers while often leaving the victims bewildered and skint.

Worse still, they are costing Britain, that’s you and me, dearly.

A recent report said class actions and GLOs would cost Britain £18BILLION and strangle growth and desperately needed productivity at birth. Not great news for Rachel Reeves.

The UK is one of the highest‑risk jurisdictions for corporations facing collective litigation - and that is a big red flag for would-be investors in our country. There are an astonishing ten class action claims per person pending in the UK today, with a total valuation of approximately £134bn. That, people, is more than twice Britain’s defence budget - no wonder the lawyers and their financial backers are queueing up to take a punt.

In a report called “Class Act: The case for reforming Britain’s class action” from the Institute of Economic Affairs, author and competition lawyer Stephen Dnes warned a change to UK law introduced in 2015 had seen an explosion of speculative lawsuits, with around one new class action filed each week.

He said: “Class actions can play a vital role in deterring anti-competitive behaviour and protecting consumers, but the UK’s regime has gone off course. There is a real risk of friendly fire especially when innovative companies are sued. It is time for a course correction.”

In a case known as Merricks v Mastercard, at one point a funder tried to offer just 48p each to complainants so that funders and lawyers could have £179m of the final £200m settlement.

Or this:

The wheels of Britain’s legal system are so sufficiently greased for taking overseas cases that a Brazilian case was heard in our own High Court, using Brazilian law. And if that doesn’t boggle the mind… the mega complex, and admittedly grim case involving 19 deaths in a dam construction, involved at least 600,000 Brazilian claimants, according to the BBC. But what this successful case chiefly did was signal that English courts are open for foreign mass tort business.

Key word that; “business”.

The money to support these very expensive cases usually comes from very opaque groups known as “funders” - usually City firms taking a punt - no more morally righteous than sticking a tenner on the 3.30 at Kempton.

But the knock-on impacts can be colossal.

A pal is involved with a pending case against to be heard in England but which he fears will have a massive effect on the little islands of Cape Verde, a well-loved holiday destination off the coast of north Africa.

More than 400,000 British tourists visited last year – around 36% of their 1.2 million visitor total. I’m assured the small island nation situated between the Americas and Africa is a unique place, with its own unique climate and culture and with their tiny half a million local population tourism matters more to them than most. There’s no big country standing behind Cape Verde. Oh, and it apparently has a healthcare rating higher than many destinations beloved by Brits such as Tunisia, Morocco, and Egypt.

So, when, as is happening, a big British law firm swings in to take aim at a German-owned tour operator and a Spanish multinational hotel group over accusations of an outbreak of shigella at their resorts it is perhaps not the law firm’s clients who benefit very much, nor the presumably well-insured tour operator or hotel company that suffer. It’s the reputation of the small country Cape Verde that is just doing its best trying to welcome tourists to their nation - tourism being how the Cape generates most of its money.

As my pal says if the case is successful a few people will make a few quid, and lawyers and their funders make a shedload but, even though it’s not their fault, but the country’s reputation will potentially take an unfair knock.

Obviously, we should all be on the lookout for potential trouble that goes with going on holiday. We should read the news and check the health advice on the UK government websites about foreign travel, and get insured.

But should you avoid going to Cape Verde because you read about an incident at a hotel there? No, not any more than you should avoid going to Crete or the Canary Islands etc should you read about something similar there.

Should you get involved in a group litigation after a publicity campaign is run by a law firm to find themselves more claimants to join their case? I guess that would be up to you, but critics of the case have suggested some claimants are down to receive as little at £10 each even if they win - it would seem, and I’m going out on a limb here, that the real benefits claims like this are huge fees for lawyers and funders.

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Obviously recourse to law is enshrined in the rights of an Englishman/woman/they, and the law is there to be used.

But it does make you wonder what Erin Brockovich might make of it.