I welcome the Minister to the House. She has the floor of the House.
Personal Injuries Assessment Board (Amendment) (No. 2) Bill 2018: Second Stage
I am pleased to bring the Personal Injuries Assessment Board (Amendment) (No. 2) Bill 2018 before the Seanad. This is an important Bill as the Personal Injuries Assessment Board, or the PIAB as it is commonly known, facilitates the objective assessment of damages at a much lower delivery cost and in a far shorter timeframe than through litigation.
The cost of insurance working group report on the cost of motor insurance published in January 2017 suggests that the delivery costs for cases settled outside PIAB continue to be more than 40% of compensation costs. As Senators will be aware, pricing in the insurance sector has been the subject of much volatility in recent years. Many commentators have suggested that the cost of personal injury claims is a contributing factor to the high cost of insurance premiums and, as Minister for Business, Enterprise and Innovation, I am very aware of the serious impacts on businesses of high insurance costs. Therefore, encouraging more claimants to finalise their cases through the PIAB model rather than resorting to litigation should lead to cost savings in the claims environment. This is good for businesses, consumers and society as a whole as it delivers compensation more quickly, with lower costs and predictable outcomes.
The primary objective of the Bill is to amend the existing legislation, the Personal Injuries Assessment Board Acts 2003 and 2007, to strengthen PIAB in terms of operational issues to ensure greater compliance with the PIAB process and encourage more claims to be settled through the PIAB model. The Bill is one element of the Government’s response to facilitate cost savings in the personal injuries claims environment.
The PIAB operates an administrative, paper-based process and assesses damages on the same basis as the courts in accordance with the laws of tort. Effectively, this means that the PIAB assesses amounts for general damages, this is the amount for pain and suffering, and for special damages, which is the amount for financial loss such as wage loss, medical treatment costs or out-of-pocket expenses. The PIAB does not determine liability. With the exception of claims for medical negligence, intending applicants must make their personal injury claim through the PIAB unless they settle the case directly with the other party.
In assessing cases, the PIAB usually requires the claimant to attend an independent medical practitioner for an up-to-date medical examination and final prognosis. Within a legislatively defined time period of nine months, the PlAB’s assessors make an award and issue it to both parties. If the award is accepted by both parties, an order to pay is issued against the respondent who then pays the compensation to the claimant. If either party rejects the award, then the PIAB issues an authorisation to the claimant. An authorisation by the PIAB is necessary before a claimant can initiate proceedings in court. Under the legislation either party can reject a PIAB award. Award acceptance is not compulsory as this would impinge on a person’s constitutional right of access to justice which is delivered by the courts. The PIAB makes awards in approximately 12,000 cases annually with around 60% of claimants accepting them. The acceptance rate has remained broadly consistent in recent years. These cases are dealt with speedily and at a low cost. The current delivery cost is approximately 6.5% of the value of the compensation and this mainly comprises the fees paid by the claimant and respondent, and the costs of the medical reports required to assess the case.
In making its awards, the PIAB uses the book of quantum so that awards reflect what is likely to be achieved through litigation but at a much lower cost of delivery. The overall average award made by the PIAB in 2017 was €24,879 with the average motor liability award being €23,234, the average employer's liability award being €32,015 and the average public liability award being €27,638. Award values vary depending on the nature and severity of cases received. Today's PIAB non-adversarial model delivers settlements to claimants without the need for litigation.
In 2014, a public consultation was held to examine the operation of the legislation and to identify any areas relating to the scope, powers or operation of the 2003 Act that required change. Some 29 submissions were received. The cost of insurance working group report made a number of recommendations in regard to strengthening the PIAB model, namely, to address issues of non-cooperation with the PIAB and the frequency of the publication of the book of quantum. The report on the rising costs of motor insurance produced by the Oireachtas Joint Committee on Finance, Public Expenditure and Reform, and Taoiseach of November 2016 also recommended enhancing the powers of the PIAB.
The outcome of the public consultation process and the two reports referred to have informed the content of the Personal Injuries Assessment Board (Amendment) (No. 2) Bill 2018. Encouraging more claimants to avail of the PIAB model rather than resorting to litigation should lead to cost savings in the claims environment and this should ultimately lead to reductions in insurance premiums, thereby benefiting consumers and businesses.
I will summarise the main provisions of the Bill. Section 2 amends section 13 of the 2003 Act regarding the documentation required by the PIAB before the formal notification shall be served on a respondent to ascertain his or her wishes regarding an assessment by the board of the claim. A formal notice will only issue to a respondent when an application, a report prepared by a medical practitioner in respect of the personal injuries and the fee have been received from the claimant by the board. This amendment will not affect the operation of section 50 - the statute of limitations will continue to be paused upon the making of an application to the board, irrespective of whether it is accompanied by a medical report and fee. If the application is not accompanied by a medical report and-or the fee, the board may issue a preliminary notification to the respondent that a claim has been received identifying them as the person the claimant holds responsible for his or her injuries.
However, the respondent will not be obliged to consider consenting to an assessment being made in the absence of a medical report and-or the fee being submitted to the board.
Section 4 amends section 17 of the 2003 Act regarding the discretion of the board not to arrange for the making of an assessment in certain circumstances, as set out in section 17. These include circumstances where there is insufficient case law on the type of injury and the assessors cannot quantify the value of the claim or, in the opinion of the board, there is such complexity in issues regarding assessment of the claim, including, for example, issues involving multiple injuries or a pre-existing injury, that it would not be appropriate for the claim to be assessed, or where the injuries consist in whole or in part of psychological damage and it would not be appropriate for the assessors to assess the claim given the limited means afforded to them by the Act as to how they are to assess a claim. The assessors, unlike a court, cannot hear oral evidence from the claimant or observe the claimant undergoing cross-examination which may be appropriate in determining the value of a psychological injury in certain circumstances.
It is proposed to extend the categories listed in section 17 of the 2003 Act. This, for example, will include circumstances in which the board is unable to serve statutory documents, where the respondent has notified the board of his or her intention not to accept any assessment when made, or where a settlement has been negotiated in respect of a minor or persons of unsound mind to be approved by the court.
Section 5 amends section 22 of the 2003 Act to provide for different levels of charges levied by the board on claimants and respondents for submitting electronic and paper formats of documents to it. As it is cheaper to submit and process documents electronically, this should be incentivised. There is also provision for the PIAB to levy staged charges on the respondent for the various stages of the claims assessment process.
Section 7 amends section 50 of the 2003 Act to ensure consistency in the disapplication of limitation periods under the Statute of Limitations within the PIAB process and to rectify any discrepancies arising from interpretations of the Renehan v. T & S Taverns judgment, 2015 IESC.
Section 8 amends section 51 of the 2003 Act by the insertion of a new section 51C to deal with cases of non-compliance with a request by the board under sections 23 or 24. The 2003 Act provides that where a claimant fails to supply details of his or her claim for special damages or fails to attend a medical examination arranged by the PIAB or where the claimant has failed to assist or co-operate with retained reports, the board is obliged to carry out the assessment. The assessment will not reflect the appropriate value of the claim and may therefore be rejected by the claimant. Upon rejection, the board releases the case and issues an authorisation to the claimant that allows the claimant to bring legal proceedings. To deter non-compliance with the PIAB process, section 8, by the insertion of section 51C into the 2003 Act, introduces a deterrent in any subsequent legal proceedings in terms of legal costs whereby the court may, in its discretion, taking into account any failure to comply, make an order on what costs, if any, it will allow the claimant. The court can also order the claimant to pay all or a portion of the costs of the respondent.
The amendment also provides a deterrent regarding legal costs for non-compliance by a respondent to a request by an assessor for information or documents or to assist or co-operate with retained experts. The court may, in its discretion, taking into account any failure to comply, make an order on what costs, if any, it will allow a respondent. This should contribute to maximising the use of the PIAB model, encouraging higher levels of consent to assess claims and increasing acceptance rates of awards. The Bill, including this section, has been drafted in consultation with the Office of the Attorney General.
The general scheme of the Bill published in 2017 provided that, where the claimant has failed to comply with a request by an assessor under section 23 or 24, the court would also have discretion as to what evidence would be admissible in court, in terms of claims for special damages or medical evidence that was available but not submitted by the claimant to the board prior to the making of the assessment. The general scheme also provided that where a respondent failed to comply with a request under section 23 for additional information, the court would have discretion to determine what evidence would be admissible in the proceedings. On the advice of the Attorney General, the Bill has been drafted taking into account that the function of the court and the constitutional duty of any judge is to hear all the available evidence and arrive at a decision on foot of that evidence, and to determine issues of liability and quantum.
A plaintiff also has a right to tender evidence before the courts. The court must retain discretion in any given case to ensure constitutional rights are vindicated and fair procedures are followed. This section of the Bill, by providing for potential financial consequences to be applied for non-compliance with requests by PIAB assessors, should encourage parties to adhere to the requirements set out in the Act.
Section 9 amends section 54 of the 2003 Act to provide that the board shall review and update the book of quantum every three years, or sooner if the board decides it is necessary. The 2003 Act did not make it clear that the book of quantum should be updated at regular intervals. The book of quantum was first published in 2004 and updated in October 2016. Section 10 amends section 54A of the 2003 Act to give the board power to obtain information from individuals or bodies to provide data for the purpose of the board fulfilling its functions in terms of preparing and publishing the book of quantum, and collecting and analysing data in relation to amounts awarded or agreed in settlements, and not just in relation to the board's function regarding the making of a cost-benefit analysis.
Sections 11 and 12 amend sections 56 and 57 of the 2003 Act regarding the composition of the board to fully reflect Government policy that, in so far as appropriate, appointments to the board of non-commercial bodies are appointed following a Public Appointments Service process. The Bill also provides that board members cannot serve more than ten years on the board. This is in line with the 2016 code of practice for the governance of State bodies. Provision is also made in the Bill that where a board member is nominated to the Seanad, or becomes an elected representative of the Oireachtas, the European Parliament or a member of a local authority, he or she may no longer serve as a board member.
Section 13 inserts a new section 74A to provide for a reserves policy for the PIAB. Legal advice obtained by my Department is to the effect that legislative change is required for the board to remit surplus moneys to the Exchequer. The PIAB shall now remit to the Minister, for the benefit of the Exchequer, any moneys in excess of those authorised to be retained by the Minister, with the consent of the Minister for Public Expenditure and Reform. The Bill specifically provides that the Minister will have regard to the operational, capital and contingency costs of the PIAB when determining the sum to be retained. At present, there is no legislative provision which provides that excess moneys can be remitted to the Exchequer. This amendment rectifies the position and implements a recommendation to the Department from the Comptroller and Auditor General that appropriate legislation be introduced to deal with excess funds held by the PIAB.
Section 14 amends section 79 of the 2003 Act regarding the service of documents by the board. It is proposed to legislatively underpin the use of electronic portals to enable the board to serve documents electronically where consent has been provided. The use of portals will also reduce administrative costs for all parties engaging with the board and introduce further efficiencies into the process. The Bill provides that the PIAB will have the facility to serve documents by using a document exchange mail service and this amendment will provide for this. This brings me to the end of the provisions of the Bill and while some sections are technical, there are important changes being made.
I know there is significant interest in the Bill. The recommendations from the reports of the cost of insurance working group and the Personal Injuries Commission are, alongside this Bill, important measures in the Government's response to facilitate cost savings in the claims environment. I look forward to working with all Senators and having their support for the Bill to enable its speedy enactment. This is important legislation. Settling more claims through the PIAB rather than resorting to litigation should lead to cost savings in the claims environment and this should ultimately lead to reductions in insurance premiums, thereby benefiting consumers, businesses and society as a whole. I commend the Bill to the House.
The Minister and I are doing quite a few late evenings here together. I am delighted that Fianna Fáil is able to support the passage of this Bill.
St. Valentine's Day is nearly upon us. Unfortunately, we still have a few differences to address in respect of things in here. There are a couple of things that we have been disappointed about. I hope the Minister will take them into consideration. We have yet to establish a national claims information database or tackle insurance fraud in a meaningful way. As has been pointed out here on quite a number of occasions, particular practising solicitors would be well aware that they have fraudulent cases but there has been no effort made to address it. Some might sigh but that is the reality of it. Judges are throwing several cases out and there have been no cases brought forward from cases that have been dismissed. That is certainly something we could address. It might make people think twice before bringing some cases in the first place. We have yet to establish an anti-fraud unit in the Garda Síochána, as we have discussed before, or to set up a business insurance premium index that would track prices over a given period. We have yet to take any action towards stabilising personal injuries claims, although the Minister has addressed part of that today. We have yet to establish a judicial council to compile guidelines for general damages relating to personal injuries. They are just a few of the issues we would gladly see fleshed out further in addition to the Bill that is before us.
I will not take ten minutes. It will be much shorter than that. I welcome the Minister and strongly congratulate her and the Government on bringing forward this legislation. It is very important. Its purpose is to encourage co-operation with the board. As the Minister says, it will make things a lot more streamlined and efficient. In some cases, its purpose is to disincentivise fraudsters and clean up the whole process. At the moment, there is a lot of entanglement and a need for clarity in respect of evidence and proofs of evidence. The legislation requires a claimant to bring a lot more solid evidence in front of the PIAB a lot earlier so the board can do its job as it is set out, with which it has been having difficulty. As a result, we should have reduced legal and insurance costs. All in all, the legislation should start giving small and medium-sized businesses in Ireland a little bit more of a fighting chance. That is very much to be welcomed. The Minister has a particular passion for SMEs, and I very much appreciate that. The fight has only begun in respect of small and medium-sized businesses. We really have to keep our focus on it.
I note that the Minister mentioned the law of tort. The PIAB uses the law of tort. That started with the law of equity back in the day and moved on to tort. In respect of tort, there are two or three pieces that defendants must show. They must show they have suffered as a result of a foreseeable loss and that the person against whom they are claiming had a duty of care and breached it. It is pretty straightforward and widely used, even though it is a common law action. There are many precedents in court in this respect. That is very important because we are working on precedent. The Minister is giving a structure to the PIAB to carry out its work effectively, which was being inhibited in the past.
I have one request. I introduced the Perjury and Related Offences Bill 2018 in the Seanad a number of months ago with the support of my Technical Group. It is due to be debated on Committee Stage this term. It will strongly support the present Bill. If I may say so, I also believe it will help Senator Davitt with some of the queries he has raised. It is going to clean out the system so that a defendant will have to be pretty confident that he or she has suffered loss and that there is a duty of care and that, as a result, he or she is entitled to a claim. Those who are entitled are right to claim but we have to clean it up. I would very much appreciate the support of the Minister and the Government for the perjury Bill. I believe both Bills go hand in hand.
Lest there be any accusations of a conflict of interest, I wish to state at the outset that, as a practising GP, I see many people who are injured in road traffic and other accidents. I remind the House that pain is subjective and very difficult to assess objectively, although we can assess loss of function. It is a complex area.
I am very pleased Senator Ó Céidigh was here to speak to the perjury issue. While I welcome the Bill, I wish first to raise some of the issues raised by Senator Davitt. Many of the issues he mentioned are outside the scope of the present Bill and belong in other Departments, particularly insurance fraud, which is not just a case of what happens in court but sometimes how the accident happened in the first place. We have all seen the videos, the two-car accidents with eight participants and all the rest of it. In those situations, from a medical practitioner's perspective, all I can do is record the injuries and complaints. All else is beyond my remit. The anti-fraud unit is not something the Minister can address in her area but it is a Government issue. It is a suggestion that I strongly support, by the way. An anti-fraud unit in the Garda would make a hell of a difference. I am mindful of the many discussions we had on this issue in the Oireachtas Joint Committee on Business, Enterprise and Innovation when we had the Insurance Alliance in. It pointed out that hardly anybody has been convicted of perjury in this area for years. Clearly, we need to strengthen the law, so I welcome Senator Ó Céidigh's Bill.
Judges are like everybody else. They are not infallible. One of the requests made was that, where a judge did feel it was appropriate to exceed the book of quantum, he or she would give a written explanation. There are many areas this Bill cannot address, but insofar as it can address those issues which are within the Minister's remit, I very much welcome it. It is notable that 40% of compensation costs lie in the cost of the delivery of the case. That has to be serious food for thought for all of us. Going through the PIAB is certainly the way forward. The book of quantum is an important area and I am glad the Minister has emphasised that it is not just to be reviewed every year but can be reviewed sooner if the board decides it is necessary. Many would feel it is very necessary when we are paying out four to five times more for a whiplash injury here than in the United Kingdom. I especially welcome that.
I also welcome the issue of the boards. There should be competency-based individuals on the boards. We have heard a lot of talk of boards recently. One of the first things we did during my time in the Department of Health was to start putting people on boards who had expertise in law, HR and accountancy. That is very appropriate and welcome here. Members not serving more than ten years ensures that the board is kept refreshed and reflects the changing times we live through.
On the issue around moneys in excess of those authorised to be retained by the Minister, it is just common sense in my view. The only other area I wished to speak to was non-compliance. In her opening remarks, the Minister stated:
To deter non-compliance with the PIAB process, section 8, by the insertion of section 51C into the 2003 Act, introduces a deterrent in any subsequent legal proceedings in terms of legal costs whereby the court may, in its discretion, taking into account any failure to comply, make an order on what costs, if any, it will allow the claimant.
That is very important. We have to try to make it easy for those who are injured and have suffered loss and pain to be compensated in an expedient fashion, notwithstanding that cases sometimes take a while to settle in terms of uncertainty of the prognosis in more serious injuries.
The longer somebody is out of work and the longer a case goes on, the more likely a person is to develop psychological problems. There has been much work on this, regarding how a person can begin to feel the pain is worse, then after a settlement he or she may suffer guilt because he or she feels the pain was not so bad. It is a complex area. If a matter can be settled more quickly through PIAB, it is, in most cases, the preferable way to go. I accept what my colleague, Senator Davitt, has said about the areas not covered but I do not believe it is appropriate to this Bill. I hope that the Government will address those issues. It is clear that people go into court who make false claims and there is absolutely no consequence or fear of consequences for them. They can come again with a scéal eile mar a deireann siad. I welcome the Bill and look forward to its speedy passage.
I welcome the Minister. The insurance industry has brought about and lobbied for a substantial change in the law. We have a situation where insurance companies still make substantial profits from premiums and we have not seen a significant reduction in insurance premiums over the years. There have been many changes, including the abolition of juries, the changes of procedures in courts and the setting up of PIAB. I have come across instances where insurance companies have collected premiums but have then come up with issues with regard to paying out on claims, which is a problem from time to time. It is not all on one side.
There is a robust process for fraudulent claims. In fairness to PIAB and the courts system, if a defendant believes a claim to be fraudulent, it can decide not to accept the recommendations of PIAB and can leave it to go into the courts system. The courts have been upfront in dealing with claims where they believe the claim is fraudulent, especially where it is identified that there are a number of claims arising from a single accident. The legal profession also has a duty of care. Any solicitor takes a high risk if he or she has any indication that fraud is happening. One problem that I have to be careful of as a practising solicitor is making sure that, when I get the evidence, it is given to me at face value. If I have any doubt, I would certainly refuse to act further and would come off record in the case. I have done so where I have thought that was the appropriate way to deal with it.
On delays in claims, while I acknowledge my colleague is a medical practitioner, an issue that can arise is a delay in getting medical reports from time to time. It is not because there is a delay by the general practitioner but because he or she is waiting to receive a report and it is not possible to give a final conclusion on the long-term effect of an injury. Not all injuries can be assessed in a short timeframe. I have come across cases where, two years down the road, there still was a question about what the long-term effect would be and the reports sought from medical practitioners and consultants still were inconclusive. I remember dealing with cases where we were in settlement negotiations in which there was significant disagreement over what the medical people were saying on behalf of the plaintiff and on behalf of the respondent and then not coming to an agreement but getting further reports merely to support the claim.
People do not deliberately delay progression of cases. There are genuine reasons. I have come across cases which were settled too early, when, for example, someone suffered an injury, whether a hip or knee injury, and there is a question of whether there will be arthritis in the long term. Such issues have to be looked at. It is about getting a balance. The PIAB system is working. There is a procedure for people who are unhappy with the offer from PIAB. There are sufficient checks and balances and the Minister is bringing forward these changes. It is important that people who suffer injuries are adequately compensated for the loss that they have suffered. I have seen people who have come through the legal process, have not been able to go back to the type of work they were involved in previously and are not able to do the additional hours that they were able to do prior to the accident. They should not have to suffer because of the negligence of someone who caused the accident. It is important to have that balance.
Our court system has worked well in identifying fraudulent claims and ensuring they have not gone through the system. While I find that insurance companies are able to give an impression that a large number of cases are fraudulent, I do not accept that. Fraudulent cases are easy enough to identify and many of us, certainly in the legal profession, will walk away from them from an early stage and make sure they do not get anywhere in the system because they only cause problems for genuine claimants where genuine injuries are suffered. If a person succeeds at a fraudulent claim, it then reduces credibility if there is a genuine case at a later stage. We need to watch that carefully. I welcome the changes that the Minister is talking about. She has given a full explanation. We need to get balance in this regard as the insurance companies are not always right.
I welcome the Minister. I am speaking on this debate on behalf of my colleague, Senator Mac Lochlainn, who is on Government business. I thank the Minister for bringing forward this Bill to introduce changes to how the Personal Injuries Assessment Board works. It is a small step in addressing the escalating insurance costs, which are really hurting motoring and business owners across Ireland. In my area, Dublin South-Central, I hear from many small business owners and motorists, both young and not so young, who are crippled by insurance costs. Just last week, a local club in Crumlin got a grant via social inclusion to allow older people to access the first floor of a building to do a small job on it. They then received the insurance costs because there was a claim from two people attending there. Following the claim by two people, the insurance cost went up from €28,000 to €55,000. It cripples people, especially those trying to do their work or to offer a service to a community.
Insurance companies hold a special place and it is not one of smiles and laughter. They hold that place because it is a legal requirement for motorists and businesses to purchase their services. It guarantees the business and it is a great benefit. The profits should therefore come with some additional oversight. Far more work needs to be done by the Government to challenge the industry, to make operations more transparent and to ensure that Irish customers are protected. With regard to house insurance, my back wall fell in during a storm and it cost a couple of thousand euro to rebuild it. I was charged this excess and that excess and just gave up in the end because I got so frustrated about my insurance claim going up by several thousand euro, so I just stopped. Unless it is really damaged by fire or somebody else has damaged one's property or car, one will not do anything because the companies make it so difficult.
I acknowledge the spirit of this Bill, which seeks to introduce a number of changes to how the board works. The main provisions are to clarify documents required from claimants; to provide it with the power to obtain information from any person; changes to the composition of the board; different levels of fees to be levied by the board and claimants; for the book of quantum to be published every three years; and for several other important issues to be addressed.
While I agree that most of the provisions relay the functions of the PIAB and speed up the process for compensation claims, Sinn Féin has a couple of concerns. Our main objection is to the power being sought by the Minister to take the reserves of the PIAB, which stand at €17.5 million. The reserves, which were accrued by the PIAB, should be retained by the body to ensure its independence is protected and allow it invest in the efficiency of its processes. As the Bill passed through the Dáil, we tabled one amendment which sought to remove section 13 in its entirety. Section 13 inserts a new section in the 2003 Act and will provide that the PIAB shall remit to the Minister for the benefit of the Exchequer any moneys in excess of those authorised to be retained by the Minister with the consent of the Minister for Public Expenditure and Reform. The latest figures, according to a reply to a parliamentary question which was received at the end of December 2018, show reserves of €17.5 million.
The PIAB is an independent State body which assesses personal injury compensation claims. Since its establishment, it has been a successful self-financing organisation. In 2011, the PIAB repaid the Exchequer the almost €7 million it cost to establish the organisation, which shows it is prudent. The successful self-financing structure should be maintained to ensure the body remains fully independent of Government, which is our overall concern given the quasi-judicial service that the PIAB provides. In addition to protecting its independence, the reserves could be reinvested to improve the operation of the body by, for example, reducing the length of time it takes to assess a claim, which is currently 7.3 months.
Furthermore, the functions of the PIAB could be extended by using the money. For example, the PIAB could be given the power to deal with Garda compensation. Currently, every Garda compensation claim, regardless of its value, is heard in the High Court, resulting in considerable legal cost to the taxpayer. We need to examine every aspect and area of public or independent organisations to streamline them and prevent an unnecessary charge to the Exchequer and the people's taxes. The Minister emptying the reserves of the PIAB will not benefit it or the people using its services. We will consider, therefore, retabling the amendment on Committee Stage.
Of the 40% of cases which refuse the offer from the PIAB and take the case to court, does the Minister know how many are successful and whether any of them result in less compensation than the PIAB had offered? How many does the PIAB designate as false or bogus claims? In any effort to regulate insurance and improve the industry, the default position is always that insurance is expensive because there are many bogus claims. I do not know the detail behind that but it seems to be the default response when we complain about insurance costs.
I thank the Minister for introducing the Bill. As I stated, however, Sinn Féin is considering tabling amendments on Committee Stage and we ask the Minister to engage with us in order that we can strengthen the Bill in its passage through the House. I hope this is the beginning of a wave of action by the Government that will include challenging the insurance industry directly, resulting in lower premiums for consumers and businesses.
I, too, welcome the Minister to the House. I have examined the Bill with keen interest since it was first introduced in the Dáil. I will focus on one aspect of the Bill, namely, the book of quantum. I recognise that the first book of quantum was published when the legislation was introduced and it was subsequently reviewed in 2016. The intention of the Bill is that the book of quantum will be reviewed by the PIAB every three years, which must be welcomed. Given that 60% of the cases before the PIAB relate to injuries sustained in motor vehicles, however, and given that 80% of those cases relate to whiplash, my problem is that there is a signifcant difference between the payouts for whiplash injuries in this country and those of other countries.
Furthermore, the number of whiplash injuries in this country is far higher than that of France or Germany and, therefore, one wonders whether there is a connection between the average quantum that is paid and the number of whiplash injuries. In the UK, for example, the maximum payment for a minor whiplash injury is £3,000, whereas in this country, for the same type of injury, the payment can be up to €15,700. Will the Minister indicate why there is such a discrepancy? Are the costs associated with making a claim so high that it leads to such a difference between payments in this jurisdiction and in the North of Ireland, where the guidelines for the assessment of general damages in personal injury cases are outlined in the green book?
Can the number of injuries covered in the book of quantum be reduced or does it have to increase? Is there a stipulation which requires the number to rise or can the Minister stipulate that it should decrease to reflect what our neighbours in the North of Ireland pay out? It seems ridiculous that as a result of the high payouts, there is a possible association with higher insurance premiums, which affect each and every one us, whether in the retail sector or all of us who drive through motor insurance and so on.
I am concerned about the average quantum that has been paid out since the book was published in 2016 and the difference between it and that of our neighbours. Will the Minister outline the reasoning for such a large difference? Is it because our legal fees or medical fees are too high or because it allows the insurance companies to charge so much for everyone's insurance?
In general, I welcome the Bill and other parts of it, such as the fact that a number of the board members will be selected through the public appointments process.
I thank Senators Davitt, Ó Céidigh, Reilly, Colm Burke, Devine and Lawlor for their contributions to the debate on the Bill. I welcome the general expressions of support for the overall objectives of the Bill and will try to address a number of the issues that were raised.
On the Judicial Council Bill 2017, it is a legislative priority for the Government, and the Minister for Justice and Equality, Deputy Flanagan, hopes to make signifcant progress on the Bill in the coming months. It has completed Second Stage in the Seanad and, due to the time required to enact and operationalise the Judicial Council Bill 2017 and the urgency of implementing these new guidelines, my colleague, the Minister of State, Deputy D'Arcy, chairman of the cost of insurance working group, wrote to the Minister for Justice and Equality in 2018. The purpose of the letter was to request the Minister for Justice and Equality to engage with the Judiciary to seek its agreement on convening an interim judicial council with the purpose of preparing these guidelines in line with the Personal Injuries Commission's recommendations for an interim measure of this type.
The Department of Justice and Equality is working with the PIAB on a process that will deliver an interim guideline related to the priority area of soft tissue injuries and whiplash. Options to achieve this will shortly be proposed for discussion with the Judiciary and the Courts Service, as appropriate. Judicial guidelines should lead to greatly increased levels of consistency in awards, enable early resolution of claims and reduce costs.
I would like to speak about the Garda fraud unit. The second and final PIC report, like the working group report on the cost of motor insurance, recommended that the possibility of establishing a specific unit within the Garda National Economic Crime Bureau to tackle insurance fraud be explored. On 13 December 2018 my colleague, the Minister of State at the Department of Finance, Deputy D'Arcy, met the Garda Commissioner to discuss matters related to insurance fraud, including this recommendation and the work of the cost of insurance working group. I understand that at the meeting the Commissioner indicated his preference that, in principle, An Garda Síochána not be funded from any source other than the Exchequer for the purposes of tackling insurance fraud. I am informed that the Commissioner undertook to consider further the establishment of an insurance fraud investigation unit within the Garda National Economic Crime Bureau. Senators will appreciate that the Commissioner is responsible for the allocation of resources within An Garda Síochána and that the Minister for Justice and Equality has no role in such operational matters.
More broadly, I am aware that considerable progress has been made in enhancing the level of engagement and co-operation between An Garda Síochána and the insurance industry, partly through the fraud round-table group that was established under the cost of insurance working group and which involved wide stakeholder consultation. A notable output of the fraud round-table engagement is the commitment made by the Garda National Economic Crime Bureau and Insurance Ireland's anti-fraud forum to meet on a regular basis to discuss and act on current and ongoing general issues which arise in the area of insurance fraud. I welcome the enhanced co-operation which will be very important as we tackle the issue of fraudulent claims into the future.
The Oireachtas has determined through the Central Bank (National Claims Information Database) Act 2018 that the Central Bank of Ireland is responsible for hosting a national claims information database. The legislation was enacted by statutory instrument to come into effect on 28 January last. It gives the Central Bank of Ireland the additional function of establishing and administering the national claims information database. It involves the collection and study of data from insurance undertakings for the income and expenditure associated with the carrying on of the business of the classes of non-life insurance which the Central Bank of Ireland specifies as relevant having regard to the policy set down in the Act. The legislation provides for the Central Bank of Ireland to produce a report at least once a year based on its findings and, subject to certain restrictions, to share information with requesting persons. It also provides for other related matters.
I am aware that a Private Members' Bill, the Perjury and Related Offences Bill 2018, has been introduced by Senators. It was published on 17 October 2018 and the debate on Second Stage took place on 24 October. The Bill was not opposed by the Government. The issue of perjury has been considered by the Government in the context of the work of the cost of insurance working group which is chaired by the Minister of State, Deputy D'Arcy, in the Department of Finance. The Private Members' Bill I have mentioned is a welcome development as we examine this matter which is one for consideration by my colleague, the Minister for Justice and Equality, Deputy Flanagan. The impact of this detailed and wide-reaching legislation will extend beyond court proceedings. I think all Senators will agree that Senator Colm Burke is right when he says it is important that people who suffer genuine injuries as a result of accidents be compensated for them, but it is important that we strike a balance.
As Minister, I cannot ignore a recommendation made by the Comptroller and Auditor General who is a constitutional officer of the State. The Comptroller and Auditor General provides independent assurance that public funds and resources are used in accordance with the law, managed to good effect and properly accounted for and contribute to improvement in public administration. Under Article 33 of the Constitution, the Comptroller and Auditor General is appointed by the President on the nomination of Dáil Éireann. The Bill implements a recommendation from the Comptroller and Auditor General. Section 13 inserts a new section 74A into the 2003 Act. The Comptroller and Auditor General recommended that the Department and the PIAB agree an appropriate level of revenue reserves to be retained by the PIAB and the basis for holding such a reserve. The Comptroller and Auditor General also recommended the introduction of appropriate legislation to deal with excess funds held by the PIAB. Legal advice obtained by the Department and independently by the PIAB is to the effect that legislative change is required to enable the board to remit excess moneys to the Exchequer. The board of the PIAB is anxious for the legislative change to be made in order that moneys can be remitted to the Exchequer as soon as possible. I am confident that the wording of section 13 which provides that the Minister will have "regard to the operational, capital and contingency costs of the Board" when determining the sum to be retained will ensure the PIAB will have sufficient funds to carry out its statutory functions. This is extremely important. There are other checks and balances in the system to ensure the PIAB will have sufficient funding to carry out its statutory functions. For example, the Oireachtas Select Committee on Business, Enterprise and Innovation has an oversight role when the Minister presents the Department's Estimates during the year. Another example of the checks and balances is the role of the board of the PIAB. I am confident that the PIAB will have sufficient funds to carry out its statutory functions. The amount to be retained will be agreed with it, having regard to its operational, capital and contingency costs.
The book of quantum is a record that reflects the prevailing levels of awards for particular injuries. The purpose of the book of quantum is to distil settlement and awards data in the personal injuries process in Ireland and present the results in a logical and user-friendly format. If the prevailing levels of awards are reduced, the book will reflect this, as long as provision is made for it to be updated. The Bill provides that the book of quantum will be reviewed every three years. As the book of quantum reflects prevailing compensation rates in the market, its regular publication and adherence to it by all stakeholders should have a stabilising effect on compensation awards across the market. It should also bring consistency and predictability to the cost of processing personal injury claims, which is a factor in the cost of insurance. The most recent update of the book of quantum is based on a representative sample of over 51,000 closed personal injury claims from 2013 and 2014. It includes compensation awards from court cases, insurance company settlements, State Claims Agency cases and PIAB data. While there are many requests for more granularity, it is important to note that the book of quantum provides for quite a high level of granularity, where possible, particularly compared to similar publications such as the UK Judicial Studies Board guidelines. When the UK guidelines were last published in September 2017, damages across injuries were reviewed and increased in line with the retail price index, rather than simply reflecting the prevailing levels of damages paid. The UK guidelines are published at two-year intervals.
I reiterate that very few cases proceed to court following the PIAB process. This shows that the process works effectively. I want to strengthen the powers of the PIAB to enable it to do its job more effectively. I thank Senators for their time and ask them to support the Bill as a priority. I hope we can bring it through the Seanad efficiently, with a view to having it enacted as soon as possible. I look forward to the continuing engagement of Senators on this practical and important legislation.
When is it proposed to take Committee Stage?