For any claim issued since May this year, it is now mandatory to "attend" a mediation phone call. This is not part of the actual judicial process. There is no judge or lawyers involved. The only requirement is to "attend" the call.
So, you offer £0 and it is over in minutes. Do not agree to settle anything. If the mediator tries to persuade you that you should consider any offer or that if you don't you may not win, you must report that person in a complaint. They are not legally trained and must not be giving any legal advice or suggestion.
So, offer £0 and carry on with your life.