Vol. 496 No. 4
27 Ms Fitzgerald asked the Minister for Defence the cost to date of deafness compensation claims including legal, administrative and compensation; and if he will establish a tribunal to deal with these claims in view of recent Supreme Court decisions. [23131/98]
The amounts paid out to date are: £2.04 million in respect of 124 court awards; £41.5 million in respect of 1,745 out of court settlements; and £12.25 million in respect of 1,401 claims where legal costs have been paid to date. The total cost to date is close to £56 million.
Administrative costs are currently estimated at approximately: £750,000 per year for staff and overheads in the Department of Defence; £850,000 per year for staff and overheads in respect of the Defence Forces; and £795,000 per year for staff and overheads in the Chief State Solicitor's Office. A total estimate for administrative costs is, therefore, £2,395,000 per year.
With regard to proposals to establish a compensation tribunal, I am most anxious to ensure that genuine cases of hearing disability are compensated as speedily as possible, and I believe the most effective way of achieving this is by way of some form of out of court settlement procedure. This has been a long-standing position of mine. Following the judgment in the first Green Book test case in May last — Greene v. Minister for Defence — I had hoped that proposals could be brought to Government for approval to establish a compensation mechanism outside the courts. However, the outcome of a second case in July — Hanley v. Minister for Defence — brought huge cost implications to bear on this proposal.
The recent Supreme Court decision on the case of Smith v. Minister for Defence and Others, while very welcome on a number of counts, has not overturned the Hanley jurisprudence or the tariffs which that case has applied to Army hearing loss compensation claims generally.
The Hanley case is being appealed to the Supreme Court and the question of establishing a formal out of court mechanism will be considered again following the determination of that Supreme Court appeal. In the meantime I have instructed officials in my Department to endeavour to settle claims informally on an out of court basis where reasonable discounts can be obtained.
It is unfortunate there is a stand-off in the relationship between the Minister and PDFORRA given the scale of the problems that need to be resolved, including the deafness compensation issue in relation to the Defence Forces. There were a number of cases last week, including a Supreme Court decision which has implications for the Green Book. The Supreme Court statement said serving in the Defence Forces, even if protection had not been used, did not necessarily mean compensation should be given, that the cause and effect would have to be proved. In light of this, has the time come to end the reliance on the courts system and begin negotiations to establish a tribunal? Given that the awards have dropped significantly in the courts and that the Green Book seems to be accepted in the courts system, has the Minister all the elements required to begin negotiations to establish a tribunal to deal with this issue? How many more cases does he intend to appeal before making this move? I understand there are at least 11 cases on appeal to the Supreme Court. For how long does the Minister intend to continue the reliance on the courts? Has the Minister made a decision on that and is this the appropriate time to move from the courts to an alternative system? The administrative and legal costs would be saved if there was a tribunal. At what point will the Minister move to a system which everyone, including the Minister, agrees would be a better way of managing the huge demand on the Exchequer and allow a fair system for claimants who have genuine hearing loss?
There is no stand-off between PDFORRA and myself but there is a significant difference of opinion. I do not believe the ordinary taxpayer or the welfare of the Irish community is defended properly when people with little or no perceptible disability are awarded high damages in the court or out of court, which draw on funds desperately needed for other areas. So long as PDFORRA defends that right——
I was referring to the broader issue.
——I am on the other side, as I have to be. There are 17 cases pending appeal to the Supreme Court. I am anxious to save on the legal side. That is why I began the pilot scheme. Notwithstanding the Hanley case, and the Johnson decision is in it, which had terrible repercussions in terms of the overall cost of the claims, I am in a position to establish a tribunal — which I dearly want — only when the tariff for the minor disabilities reaches affordable levels, which it has not done. I agree it has come down on average from £35,000 per claim in 1995 to a little over £16,000 in the middle of this year. After the Hanley case, tariffs have increased to over £20,000 but are beginning to taper down following the Smith case. I need a few more positive decisions to help us get into the position of establishing the tribunal. I am not waiting for that to happen on the pilot scheme where there is an indication of cost savings to the Exchequer. I have been told, both formally and informally, by the solicitor firms representing the plaintiffs that they want to negotiate and help us make savings. We are in that process with a number of firms. Side by side with what is happening in court, there is an out of court environment I am trying to operate with some disability because of the Hanley judgment. I am moving as quickly as I can towards that kind of scenario.
