I would like to draw a distinction in respect of this Bill between the principle of compensation or of reimbursement to the health boards of the expenses which they have incurred as a result of treating road traffic accident victims and the actual method which the Minister proposes to introduce to bring about that objective. I am unenthusiastic about the principle but I can assure the Minister that I have no intention of objecting to the principle and that I know it is a matter on which people have different viewpoints. There is not a correct side or a correct view on it. We are really deciding that it is better to have slightly higher levels of motor insurance premiums and slightly lower levels of taxation. In the long term, we are shifting resources from one side to the other. I could have very little objection to the Minister's objective in doing that, as long as we realise that is what we are doing.
It is simplistic to ask whether premiums have come down in the intervening period of time. Premiums are adjusted from time to time and take into account every single factor which makes up the insurance risk. This, of course, is just one such factor. It is impossible to prove that premiums have not gone up by as much as they would otherwise have gone up but that argument will be made by the other side. It is simplistic to suggest that this should have given rise to a reduction in insurance premiums and it did not. I do not think we should approach it along that road.
The point made by Senator Smith is a good one. I do not understand why the Minister should have to wait for two and a half years to introduce this Bill. No doubt he will tell us the reason for that. I was quite interested to hear what Senator Robb had to say about the whole principle of compensation for accident victims generally. It is true, of course, that a very convincing argument can be made against substantial capital sum payments. I must say that I find myself in sympathy with the general viewpoint that these capital sum payments should not be made on a philosophical level. However, the problems that would be created by substituting for that, for example, a weekly payment, is such that you would reinforce dependency in the population. If lump payments have any benefit they have the benefit of bringing to an end the period of time in which people who have been subject to these injuries must, even subconsciously, consider themselves to be still suffering from whatever disability they allege they have been suffering from.
It is not just a question of honesty. It is a question of a subconscious feeling that I hurt my neck or my back in a traffic accident and it does not clear up until after the court case is over. If you have a situation where people are going to be paid a weekly sum for the rest of their lives it could become a growth industry. Everybody will want a weekly sum which will be a guaranteed income for the rest of their lives. I know the Irish people and that is the way they would react to that scheme. They would react to it in the same way as certain sections of the population react to the disability benefit scheme, that it is some kind of a scheme which can be used for the granting of premature old age pensions to people rather than granting them protection for temporary disablement or permanent disablement which was the original purpose. Maybe lump sum payments are a bad idea but I am not altogether convinced that the alternative of weekly payments is suitable to the Irish temperament. I would need much more persuasion before I could support that approach towards compensation. The whole business of compensation is one which must be tackled at some time in the future and I look forward to participating in that debate.
I accept the principle contained in the Bill but it has one major defect. Senator Cregan by his look, obviously does not agree with me. The major defect which the Bill has is in subsection (2) of section 2 which has already been referred to by a number of Senators. The granting of a discretion to the health board there may give rise to considerable difficulty in practice. The Minister may be able to say that on the previous occasion no great difficulty was encountered. Times change and this is a new scheme which is starting from scratch. The health boards are under pressure for money in a way that they have never been under pressure for money before, and I think it is only right that they should be under that pressure. They are under pressure and any Minister for Health whether it is the present Minister, a substitute Minister from the same Coalition or in any possible alternative Government, will have to keep the expenditure of the health boards under control.
In those circumstances the Minister is introducing this scheme into a climate where the health boards are under great pressure for money. It is in that context that we should see what problems might be created by the use of the word "may" in subsection (2), the first sentence of which states that a health board may waive the whole or part of a charge. Subparagraph 1 of subsection (2) (a) is quite reasonable because that is a discretion to cover the general cases that may arise from time to time that we cannot anticipate. The second one is more specific. It seeks to establish a situation as to what will happen when there is a degree of contributory negligence. It seems to suggest that the health authority would in such circumstances rebate the amount of their charge to take into account the amount of the contributory negligence. It fails, of course, to impose any obligation on the health authority to do that. That could have disastrous consequences for the person who has been injured.
I can give some practical examples of it. Take the case where a person suffers an injury. I am not talking about a dramatic injury but a broken leg or something like that which requires a little bit of treatment and from which there is a complete recovery. We will say in those circumstances that a person decides to go to the Circuit Court or the High Court at a lower jurisdiction of that court and is entitled to a compensation in respect of their injuries in general damages, that is for pain and suffering in the past and in the future say, £10,000. We will say their medical expenses for the sake of argument amount to £5,000 giving a total potential award of £15,000.
Let us, first of all, consider what will happen if this goes to court. We will say the court ascribes to the individual concerned 60 per cent of the responsibility for the accident and against the defendant 40 per cent. The result of that is that the person is entitled to reclaim only 40 per cent of £15,000 damages, £10,000 for general damages and £5,000 for medical expenses. In other words the person will get a cheque ultimately for £6,000. This is after a court award. This is not a settlement case. On receipt of that cheque for £6,000 it will fall on the health authority at that stage to determine what portion, if any, of the £5,000 medical expenses they will in fact collect from the individual. The general tenor of what the Minister has said is that they will collect £2,000. That is 40 per cent of the £5,000, leaving the person with a net £4,000, which would be the correct calculation. But there is no obligation on the health authority to make that remission.
The health authority may decide that it is going to charge £3,000, £4,000 or £5,000 and the legislation as drafted will support it in that decision. So you could have a situation where a person in receipt of £6,000 could have to pay £5,000 to the health authority and receive in respect of the injury a sum of only £1,000 in general damages in circumstances like that. You can do many calculations which will arrive at a different set of figures, but the principle is still the same.
When the court awards a sum of money, that award is a separate judicial decision-making from the decision-making which will take place later when the health board will decide what to charge. Any occasion where two separate people decide on the same issue gives rise to a potential conflict. A court might decide that in certain circumstances a person should get only 40 per cent compensation, but the health board might decide in its wisdom not to accept that assessment of the position and there is no obligation on it to so do. In those circumstances you can see that, while of course it is reasonable to assume that the Minister means that they are to limit their charge to 40 per cent and it is reasonable to assume that the health board will do that in most cases, they will, in so far as I have been able to ascertain, be under no statutory obligation to so do. That places the person on whom the charge falls in a considerable disadvantageous position. I do not know how he can successfully challenge a decision by the health board, taken after his court case has been settled, to charge the full amount or an amount which does not rebate to the full extent of the contributory negligence.
That is the problem that arises where the decision is by the court. Consider the problem that would arise when you come to settle a case. Most cases are settled, in spite of what people say, before anyone gets substantial lawyer's fees. That is something which should be encouraged rather than discouraged. This aspect of the case as applied to the problem of settling cases is going to mean that the tendency will be for more cases to go to trial because of the problems that may be created by settling a case. Consider the case I mentioned earlier: damages of the order of £15,000 — £10,000 general damages and £5,000 medical expenses. A person is offered before the hearing of the accident a sum of £6,000, the full value being £15,000, and there is a question of liability. It would appear that before accepting that figure of £6,000 a decision would have to be got from the health board as to what portion of the £5,000 medical expenses they would remit in the event of the person accepting the £6,000. In order for the health board to make that decision they would have to be advised by someone as to what the full value of the case is. They would have to be advised that the full value of this case is £15,000, the plaintiff proposes to accept £6,000 and, therefore, he is, in effect accepting 40 per cent of the full value and will remit down to 40 per cent of what the total bill is. But are there people in the health board competent enough to be able to make that assessment on their own? If so, will their assessment agree with the assessment of the professional advisers of the plaintiff? One can see that the number of problems this could give rise to is significant.
Very often in the court itself — particularly in the Circuit Court and certainly where settlements are made — settlements are made on the basis of nobody mathematically calculating what the degree of contributory negligence is. That is something which is not really identified. Somebody says a case is worth £100,000. The insurance company makes an offer of £60,000. You may decide to accept it because you might decide in the circumstances that the person does not want to appear in court. There are a number of additional reasons why sometimes amounts which are less than the full value of the case are accepted, even in circumstances where liability is not an issue or they are accepted where liability is not an issue to the full amount of the discount being offered to them. How will these people be fixed with regard to the payment of their medical expenses? Who is going to advise the health board on that? Will the health board undertake to take, in normal circumstances — I am not talking about the exceptional circumstances — the certificate of a solicitor or a barrister that the settlement represents a discount of so much? You can see the difficulty that that gives rise to with regard to the settlement of cases.
I do not know how the problem of the settlement of cases can be solved, but it would be of considerable assistance if there were two provisions included in this Bill which are not included in it. One is that a statutory obligation should be placed on the health board to take into account the degrees of contributory negligence where that has been judicially determined. That is the first point. Secondly, I think some appeal mechanism in the other cases should be available for the dissatisfied plaintiff who accepts a settlement in a case and finds himself subsequently in dispute with the health board with regard to the amount of the charge. An appeal mechanism of some kind should be made available to cater for that problem.
It appears that this legislation is required quickly by the Minister. I appreciate that. It would be unrealistic of us on the one hand to expect him to explain why it took two-and-a-half years to produce the legislation and then delay it. A delay of sufficient time to enable the Minister and his advisers to consider the points that have been raised in this House would be appropriate. In those circumstances it is important that this Bill would receive mature consideration.
Of course, it may well be that the Minister has considered all these matters. It may well be that the Minister, recognising the difficulties in this Bill, has pondered for many months on these problems. It may well be that he has considered every point that has been raised here today. I have no doubt, knowing how well Ministers are normally briefed in these matters, that these problems were considered. But the fact that the Minister intellectually satisfied himself as to the correctness of the method which he proposed to solve these problems is only part of the problem. He must then develop that to such an extent that he can persuade us of the error of our ways too, if in fact our ways are in error. That requires time. That requires a balancing of the various factors. I would have imagined that if these problems had been considered by the Minister I would have suggested that it would have been helpful if they had been referred to in the Minister's Second Stage speech. It may well be that the Minister has overwhelming and convincing arguments as to why there will not be problems by the granting of this discretion to the health boards.
The granting of this discretion, which is a discretion in cases which go to court, and which has been exercised after the exercise of another discretion by a different tribunal and the capacity of two separate decision-makers to make two separate decisions to the detriment of the plaintiff, is something that worries me. I do not think it has been adequately catered for. You have got to trust one tribunal to set the standard. If the court says 40 per cent, 40 per cent it is. If the court says 50 per cent, 50 per cent it is. I know that does not solve the problem of settlements but at least that part of the problem would be solved if we were to grant to the court the decision-making power with regard to the percentage of contributory negligence. I am not sure how we can solve the question of settlements. One of the problems that might arise is that a disagreement on the terms of a settlement could necessitate the hearing of a case which would otherwise settle prior to going to court.
Taking all these factors into account, I think the Bill is obviously welcomed by the vast majority of Senators in the House in so far as its objectives are concerned. Our duty is to satisfy ourselves that the implementation of the objectives, which are shared by the majority of the Members, is helped and not hindered by the detailed terms of the Bill. In that regard the Minister must at this stage have formed the view that there exists among a cross-section of the Members of the House, and people in this area both professional and non-professional, some disquiet with regard to the practicality of the way in which the Minister has tackled the problem.