Vol. 467 No. 3
3 Mr. Clohessy asked the Minister for Social Welfare the total amount of claims lodged with his Department by solicitors for bills in respect of women claiming equal treatment arrears; the action, if any, he intends to take in his regard; and if he will make a statement on the matter. [13096/96]
4 Mr. J. Walsh asked the Minister for Social Welfare the plans, if any, he has to reduce the cost of solicitors fees in relation to the payment of equality arrears. [13159/96]
I propose to take Questions Nos. 3 and 4 together.
Under the terms of settlements reached with the legal representatives of married women who initiated legal proceedings arising from the delay in according them equal treatment under the Equal Treatment Directive, in accordance with normal legal practice in such circumstances, my Department will meet the plaintiffs' legal costs. In the absence of agreement on the amount of legal costs, these costs are adjudicated by the Taxing Master under the normal procedures whereby a solicitor's bill is examined by the Taxing Master who may either allow it or reduce the amount involved. It is open to either party to proceedings to insist that costs be adjudicated by the Taxing Master or on review by the Court.
Particular care is being taken to reduce, as far as possible, my Department's liability for costs in these cases. The costs experts in the Chief State Solicitor's Office, in conjunction with outside costs consultants and the Attorney General's Office, are keeping bills of costs submitted by the solicitors concerned under close review, in particular, with a view to limiting overall exposure to costs. Claims for costs will be met only without recourse to the Taxing Master or the court if the expert advice available to us is to the effect that requesting the Taxing Master or the court to adjudicate would be likely to result in higher expenditure by the Exchequer.
I thank the Minister for his reply. What demand for legal fees has been lodged with the Department?
I will outline some of the historical background to this matter. A total of £170,000 in fees was paid in cases arising in 1992 or earlier; £515,000 was paid in 1993; £176,000 was paid in 1994; £135,000 was paid in 1995 and up to May 1996, £628,000 was paid. I have rounded those figures. Claims amounting to £3.397 million were made. The bill of costs in those cases was reduced by £1.767 million and £1.63 million was paid on foot of those claims. Effectively the claims were reduced by half.
Will the Department of Social Welfare pay out on foot of those demands and will it stand over them?
The payment of those fees will come from the Department of Social Welfare Estimate.
How many married women submitted claims?
I do not have information on the precise number of women who submitted claims, but approximately 70,000 women with an entitlement have received payment to date. I recollect that approximately 15,000 of those had their claims processed by private solicitors.
What reason was given by legal representatives for lodging those claims? Did they cite the delay in the payment of equality arrears or that those entitled to them were not granted payment?
This matter, which can only be referred to as a fiasco in cost terms, dates back to 1987 when the European Union adopted a directive on equal treatment which obliged all member states to treat women in regard to social welfare on the same basis as men. The Government of the day asked for a derogation for a number of years which was deferred until 1984. Subsequent legislation providing for the implementation of the directive was not implemented until 1985. The manner in which the directive was implemented gave rise to a number of cases in the Irish courts and later at European level and various judgments were handed down against the State. Some changes were made subsequently in legislation which gave rise to a legal challenge in the Irish and European courts. The European courts found against the Irish State and that gave rise to further compensation. When I came into office I found that 70,000 women had entitlements arising from the various decisions and the failure to act since 1987. It was my view and that of the Government that we needed to end the saga once and for all. If the matter had been dealt with correctly in the first instance, it would have cost the State something like £18 million, but it is now costing the State £260 million plus legal fees to rectify errors made over the years.
Is the Minister and his Department prepared to challenge the validity of the amount of the demands lodged?
As I indicated in my reply, where we are not satisfied that the claim for costs is reasonable, we are having them referred to the Taxing Master. We will pay them only where we are satisfied that, based on our internal advice and external expert advice, such a course of action would result in an increased cost to the Department. As I indicated, out of claims for £3.397 million we have had that figure reduced by £1.767 million and paid a figure of £1.63 million. By careful scrutiny and management of those claims we have reduced the claims being sought to date by about half.
In reply to a parliamentary question some weeks ago the Minister told me that his Department had paid legal fees to the tune of £616,000 in one case and more than £500,000 in another. What assessment was made in regard to the level of those substantial fees? Even if a solicitor who charges £50 an hour is paid £616,000, he or she will have to chalk up 12,000 hours to earn that money. That sum appears exorbitant by any standards. What steps has the Minister taken to assess that level of fees in the case of each of those payments?
I indicated we have been careful in the manner in which we deal with claims for legal fees. We have made sure that in all cases fees are reasonable with regard to what the Department might expect to pay and cases were referred to the Taxing Master. Based on the figures I provided in respect of bills amounting to £3.397 million, we have had those bills reduced by £1.767 million and, consequently, have saved the State and the taxpayer that amount of money by careful examination of the claims.
The Minister's reply is most unsatisfactory because solicitors were paid in excess of £500,000 and by any standards that is exorbitant. Even if a solicitor who charges £100 per hour was paid that fee he or she would have to chalk up 6,000 hours to accumulate that bill. Fees of £616,000 and £502,000 were paid. What assessment was made in those cases to satisfy the Minister that the solicitors in question were entitled to that level of fees?
I do not understand why the Deputy is unhappy with my reply. I indicated that we saved the taxpayer £1.767 million as a result of being careful about the bills presented to us.
I remind the Deputy we are paying this money due to his party's incompetence in Government.
The Minister has not replied to my reasonable question regarding taxpayer's money. He is prepared to pay on behalf of his Department more than £500,000 to solicitors in this matter. He has not answered the question as to what steps he took to ensure there was value for taxpayer's money, or is he satisfied that solicitors can submit a bill for more than £500,000 regarding this straightforward matter? As a Member of this House I am entitled to information regarding the cavalier approach of the Minister to the expenditure of these substantial amounts of money.
This is an attempt by the Deputy to deflect blame from his party for the fact that the taxpayer has meet a bill of £260 million for failure to properly administer the EU Equality Directive going back to 1987.
My Department, the Office of the Chief State Solicitor and the Office of the Attorney General have carefully addressed this matter and we have ensured we are not paying more than we ought to pay with regard to the legal fees for the cases which women were forced to take because of the unwillingness of the previous Minister for Social Welfare to meet their legitimate claims. They would not be in court and would not have solicitors if the then Minister had met these claims as we are doing.
