TONY Blair's Government is being urged to take action against the claims industry.

Middlesbrough Borough Council's call for a get-tough policy follows allegations that representatives of one firm approached youngsters leaving a Middlesbrough school, asking if they had had accidents at school they could claim for.

It is estimated that less than 15 per cent of firms in the claims culture market have joined a voluntary regulator group.

Councillor Oliver Johnson, the council's commissioner for the environment, said: "These companies take out insurance on behalf of clients and then on the strength of this they engage solicitors to fight the case on a no win, no fee basis.

"The conduct of both lawyers and insurance companies is strictly regulated, but these 'intermediaries' fall between two stools, operating without meaningful control.''

He added: "As they don't provide the legal or insurance services themselves these businesses can only make money through the introduction of new clients, so the pressure is on to sign up as many customers as possible. This being so, the temptation to use unorthodox methods is clear.''