. . that legislation. Further, the requirement to have 3rd party insurance to drive a motor vehicle doesn't apply on (fully) private land, so I can't see that the police would be interested.
So it's only a civil matter. Anyone who causes loss or damage to another, through their negligence, can be sued for compensation. In practice your neighbour wouldn't sue your son; he'd sue you on the basis that you were negligent to permit him to drive the vehicle.
(Sorry about the break in the middle. I didn't click 'Submit', so something odd must have happened there!).
Chris