Vol. 514 No. 1
50 Mr. Durkan asked the Tánaiste and Minister for Enterprise, Trade and Employment if she has satisfied herself that insurance costs are sufficient to ensure the competitiveness of Irish industry, with particular reference to public liability; and if she will make a statement on the matter. [3513/00]
In addressing this subject, it is important to state that the broader economic issue of the effect of liability insurance premium costs on the competitiveness of Irish industry cannot be assessed in isolation from the totality of costs borne by manufacturing enterprises located in Ireland and the trend in these costs relative to costs in competing economies.
That said, the Deloitte & Touche report in 1996 on an economic evaluation of insurance costs in Ireland found that premium rates in Ireland were higher than in other EU countries surveyed. It also found, in a survey of small and medium enterprises, that insurance premiums ranged from 1.4% of payroll costs in larger firms to 8% in smaller firms.
The report found that the two major factors driving up the cost of personal injury settlements in Ireland were medical inflation and the high transaction cost of claims, particularly legal costs, including the cost of expert witnesses. In response to these findings, a special working group was established under the aegis of the Department. This group has recently completed a research based study of personal injury compensation systems in operation in other countries with a view to establishing if these provide a more cost effective basis for delivering personal injury compensation. The report by the group will be submitted to us shortly.
The Deloitte & Touche report also identified improved health and safety measures in the workplace as a way of reducing costs. I regard the initiatives on the establishment of affinity schemes for small businesses, the development of a voluntary code of practice in safe working and accident prevention as significant and positive measures being taken by Irish business, through a social partnership approach, to reduce the cost burden of accidents in the workplace.
Is it intended, in light of the Deloitte & Touche report, to take any initiatives which will have an immediate and incisive impact on rising costs and their competitiveness implications for Irish industry vis-à-vis our competitors in the European Union?
A number of initiatives have been taken. Discussions have taken place between the insurance division of the Department and the various business organisations and associations. As a result, a number of affinity schemes have been put in place by the Small Firms Association, ISME, the Construction Industry Federation, publicans, restaurateurs and farming groups. The result has been an equalisation or standardisation of the risks involved and, by making group applications for the cover, it has reduced significantly the cost of that cover and of the premia.
In addition, we have developed a workplace safety group operation, involving IBEC, ICTU and the Health and Safety Authority in consultation with the insurance division of the Department. We have agreed a voluntary code of practice which should minimise and reduce the risks to ensure that the cost of insurance should not be as prohibitive as heretofore. We await the other report from Mr. McAuley and his team. When it comes to hand we will take whatever other initiatives are possible.
Is it not the case that some months before the change of Government the McAuley group produced its first report on a tribunal type system where uncontested liability could be speedily processed at a fraction of the costs Deputy Durkan referred to in his question? Two and a half years later the Minister of State is still sitting on his hands and the experiment represented by the McAuley group has not been put in place.
Deputy Rabbitte had a significant involvement in the establishment of the McAuley group. To say we are sitting on our hands is unfair. We have responded to the report and created the affinity scheme in co-operation with industry. We have put the work safety code in place in consultation with the McAuley group and we now await the group's final report. The first report presented a complex legalistic situation and we had to be certain that it would be operable and practical. We await the final report and the Deputy can be sure that we will react to it as soon as it is available.
Will the Minister give a commitment to publish that report when he receives it?
Why did the Minister not implement the McAuley proposal?
We believe it is not possible to implement it quickly without further—
The Minister of State is a wonder.
Stonewall Jackson rides again.
The report is a complex document. It has legal implications which are not acceptable to both employers and the employee organisations. There are certain legalities involved which are not that acceptable—
Both were on the team.
Yes, both were on the team.
Allow the Minister of State to continue without interruption, please.
Its implementation is a complex matter and when Mr. McAuley gives his final report, we will implement it.
I hope if there is another Cabinet reshuffle the Minister of State is given a less complex portfolio.
Ceist Uimh. a 51 in ainm an Teachta Broughan.
It is about time he was not faced with sorting out all the problems.
We have concluded that question and I have now called Question No. 51.
Why should all the complex decisions be the responsibility of one Minister?
I call Question No. 51 in the name of Deputy Broughan.
The Minister of State should get a break and should not always have to deal with complex problems.
Deputy Rabbitte, I have called the next question.
I am only trying to be helpful.
I am certainly helpful to the Deputy.
I am concerned that Deputy Rabbitte is concerned about my political well-being.
