Vol. 498 No. 2
24 Ms Fitzgerald asked the Minister for Defence the number of cases in the Defence Forces' deafness compensation claims settled out of and in court for each of the years from 1995 to date; and the cost for each category in each year. [26761/98]
123 Dr. Upton asked the Minister for Defence the number of claims for deafness compensation lodged on a weekly basis for each of the years from 1995 to date. [26806/98]
147 Ms Fitzgerald asked the Minister for Defence the number of cases in the Defence Forces' deafness compensation claims settled both in and out of court for each of the years from 1995 to date; and the cost for each category in each year. [26934/98]
I propose to take Questions Nos. 24, 123 and 147 together.
The information requested is set out in a tabular statement which will be circulated in the Official Report. The details are in line with the reply to an earlier question and I am prepared to proceed to the next question if the Deputy agrees.
|
Number of claims lodged |
Average per week |
Number of out of court settlements |
Cost |
Number of court awards/dismissals |
Cost |
|
|
1995 |
1,488 |
29 |
34 |
£1,025, 951 |
1 |
£45,000 |
|
1996 |
2,400 |
46 |
132 |
£4,131,650 |
4 |
£67,220 |
|
1997 |
6,286 |
121 |
1,155 |
£27,666,318 |
47 |
£625,730 |
|
1998 (to 7 December) |
2,835 |
55 |
555 |
£10,461,597 |
109 |
£1,459,172 |
I raised this morning on the Order of Business the establishment of a State claims agency. Is the Department actively considering this move as one element of dealing with the compensation claims and also in terms of better management by the State of cases taken against it? Does the Minister support such a move?
Yes. In the context of the pilot scheme I mentioned earlier, we are in negotiations with the plaintiffs' solicitors regarding a quantum which we consider would be affordable and fair and reduce the legal costs. We are anxious that a State claims management agency is established. A person who signified an interest is directly involved in supporting that role.
Will the Minister outline the progress he has made in his discussions with the solicitors he mentioned in relation to reducing their costs in these cases? Is the Minister confident of making progress?
Perhaps the Deputy's supplementary question could be dealt with under the next question. Question Nos. 24, 123 and 147 are basically statistical. It may be better to deal with the supplementary questions under the next two questions.
25 Mr. McGrath asked the Minister for Defence the number of cases settled out of court and in court since the green book legislation was passed. [26766/98]
44 Mrs. Owen asked the Minister for Defence if he will make a statement on the status of the green book. [17883/98]
148 Ms Fitzgerald asked the Minister for Defence the number of cases settled both in and out of court since the green book legislation was passed. [26935/98]
I propose to take Questions Nos. 25, 44 and 148 together.
The green book was published on 9 April last following which the Civil Liability (Assessment of Hearing Injury) Act, 1998, was enacted on 11 May 1998. From that date until 30 November 1998, a total of 473 cases were settled out of court while a total of 40 cases were dealt with by the courts. The total cost to date of these is £11 million. This figure is exclusive of legal costs which in the majority of these cases have not yet been settled.
In May last, the green book was subject to a test case, Greene v. Minister for Defence. In the judgment in this case, Mr. Justice Lavan stated in relation to the green book and associated legislation that “what is provided for here is a fair and reasonable method for assessing these litigants' hearing disabilities”. In this case the plaintiff, who was aged 60 and had a 2 per cent disability on the green book scale, was awarded £3,000.
However, another judge of the High Court, Mr. Justice Johnson, remained unconvinced by the green book's treatment of the effect of age related hearing loss when combined with noise induced hearing loss and a second test case was required. This case, Hanley v. Minister for Defence, was heard last July. In this case, Mr. Justice Johnson also accepted the green book “as a fair and reasonable means of calculating disability”. However, he went on to say that “the green book is not complete and there are some very serious gaps in it”. In this case, the plaintiff, who was aged 35 and had a 7 per cent disability on the green book scale, was awarded £50,575 of which £40,575 was in respect of his level of hearing disability.
The effect of the judgment in the Hanley case has been to dramatically increase the potential cost to the State of the Army hearing loss litigation. The State is appealing the judgment to the Supreme Court and I understand that the case is likely to be heard in April 1999. In the meantime, in the recent Smith case which was appealed to the Supreme Court I understand the court indicated that the green book method of calculating hearing disability is fair, just and reasonable between both parties.
Is it agreed to take Questions Nos. 26, 33, 47, 48, 98 and 103 before supplementary questions are asked? Agreed.
26 Mr. Rabbitte asked the Minister for Defence the number of claims settled to date and the amount paid in compensation in regard to Army deafness claims; the number of claims still outstanding; and if he will make a statement on the matter. [26729/98]
33 Mr. Connaughton asked the Minister for Defence the cost to date of the deafness compensation claims submitted by members of the Defence Forces; the legal and administrative cost in this regard; and the awards made. [22809/98]
47 Mr. McCormack asked the Minister for Defence the cost to date of the deafness compensation claims submitted by members of the Defence Forces; the legal and administrative cost in this regard; and the awards made. [17891/98]
48 Mr. Durkan asked the Minister for Defence the number of compensation claims pending against the Defence Forces; the number in respect of Army deafness or other categories of claims; the amount paid in respect of claims; the projected cost of all outstanding claims; if he has made the necessary provisions to meet these claims without the introduction of a Supplementary Estimate in the course of 1999; and if he will make a statement on the matter. [26857/98]
98 Dr. Upton asked the Minister for Defence the number of Army deafness cases settled in and out of court; the cost involved in this regard; and if he will make a statement on the matter. [26808/98]
103 Mr. J. O'Keeffe asked the Minister for Defence the plans, if any, he has for dealing with Army deafness in view of a potential bill to the taxpayer for damages and costs estimated at £1 billion and the average of an additional 50 court actions per week; and if he will make a statement on the matter. [26619/98]
I propose to take Questions Nos. 26, 33, 47, 48, 98 and 103 together.
By 7 December, a total number of 13,710 claims for Army hearing loss compensation had been received in my Department. Of this number, court awards following hearing have been made in 132 cases while a further 113 cases were successfully defended or withdrawn. Out of court settlements have been reached in a total of 1,910 cases. Some 11,555 claims are therefore still outstanding.
The amounts paid out to date are as follows: £2.3 million in respect of 132 court awards; £44.3 million in respect of 1,910 out of court settlements; and £13 million in respect of 1,480 claims where legal costs have been paid to date. The total cost to date for hearing loss claims is over £59.5 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. A provision of £70 million will be provided in 1999.
The amount paid to date in respect of nonhearing loss cases is £36.9 million in respect of 1,184 claims and there are 763 cases still outstanding. On the basis of an average payment of approximately £31,000 in the cases paid to date, the eventual cost of the 763 outstanding cases would be in excess of £23 million.
Projections for the likely eventual cost of Army hearing loss litigation are based on an estimate calculated using the formula applied by the courts since the Hanley test case last July. In this regard, my Department has estimated that the cost for over 11,500 claims which are currently outstanding is of the order of £550 million. This is based on the pattern of hearing loss established in cases disposed of to date. If legal costs and damages for matters such as loss of earnings are included, the potential bill is of the order of £1 billion. This estimate incorporates a number of complex legal and medical variables and it is impossible to be absolutely precise. However, the figure is conservative and, for example, does not include future claims.
Regardless of how the calculation of the estimated future cost is approached, the end result is a cost burden which is beyond the limits of any rational economics. The effect of this cost on the public finances will be damaging beyond reasonable acceptance. Such damage is not acceptable to the Government and nor do I believe it is acceptable to the taxpayer.
I am disappointed to learn the Supreme Court case will not be heard until April 1999. In view of what the Minister has said it will be impossible for the Government to take alternative action until after the Supreme Court case. Given the scale of what the Minister has outlined today and the early stage of resolution of these cases where so few have been settled and many more are still outstanding, is the Government considering an alternative approach?
We dealt with this issue earlier. The out of court environment, whether a tribunal or a compensation board system, is the most attractive, sensible and the best way forward. Unfortunately, because of the Johnson judgment in the Hanley case and the implications of that decision, all of the out of court settlements and the court awards since then have been primarily based on that decision. Following the negotiations with the plaintiffs' solicitors there has been a reasonable drop, in the past few weeks, in the total amount of out of court settlements in terms of the amount per case. If that were to proceed along those lines in the next couple of months, the option to move forward to the out of court environment, and subsequently reduce legal costs in court time and so on, would be a practical proposition, one to which I am looking. The Johnson judgment in the Hanley case put matters askew in terms of the total amount which would be required. Given the number of claims which appear to have zero disability on the green book, to engage in a tribunal at the level of the present awards would be extremely dangerous and wrong from the point of view of the taxpayer and, ultimately, from the point of view of the Defence Forces.
Would not a tribunal have to incorporate the green book to be successful? Is it not an option for the Minister to move forward, establish a tribunal and use the green book with agreed levels of compensation? If the Minister can get agreement with RACO and PDFORRA this would be a way forward which would give justice to claimants, reduce costs and be fair to the taxpayer.
I have every interest in ensuring a just outcome for the plaintiff, the public and the Defence Forces. The establishment of a tribunal does not preclude any individual from going to the High Court so long as the High Court makes awards commensurate with the Johnson judgment in the Hanley case. Why would somebody come to a tribunal for an offer which I would be prepared to make and which I have already outlined to the legal profession, the plaintiff's solicitors, on the scale that is affordable and fair? I do not mind how much people with severe difficulties are awarded. The awards can go to the sky as far as I am concerned, to be fair and reasonable. The problem we face is the huge number of claims with zero to very low disability and the awards from the courts. The establishment of a tribunal does not take away the right to go to the alternative system. That is my difficulty.
Do I understand the Minister to say that if the amounts of the personal awards being made in court show a diminishing trend, the Government is likely to set up some kind of tribunal? Assuming it does not show that trend, are we not inviting these matters to be resolved by litigation? The costs associated with litigation are of the order of a third of the awards.
That is right.
Why will the Government not take its courage in its hands and cause a tribunal to come into existence and let that tribunal settle its own quantum for the generality of cases, while anybody who so wishes to appeal to the High Court may do so?
We have had discussions with the Attorney General and the Chief State Solicitor. I had already indicated to the House I was anxious to have the tribunal established before returning from the summer recess. I would probably have said in the spring that was my ambition. Following the Lavan judgment in the Greene case we were totally on course to establish that alternative out of court environment system. We then had the subsequent Johnston judgment in the Hanley case. In our negotiations with the plaintiffs' solicitors the sky was the limit. Nobody wanted to talk about settlements and out of court arrangements because they had a new quantum. Their system of operation had new fuel. I had run out of fuel at the time. However, there is evidence of a little more sense. If after a few weeks the awards move to more acceptable levels, the option suggested by the Deputy is on the cards. I do not intend to delay it but I need solid evidence of progress on the quantum for cases with minor disability. These are the real world questions.
I suggest a totally new dimension to this awful question. Will the Minister accept it is utterly outrageous the taxpayer should fund claims which go back 20, 30 and 40 years? Will he accept it was the Statute of Limitations (Amendment) Act, 1921, that opened the floodgates? Is the Minister aware that the 24th law reform report in Britain recommended that a long stop be applicable to all negligence claims? Does he accept we might have something to learn from that? Does he agree we are in a situation where £1 billion is payable by the taxpayer in view of the fact that an extra 40 or 50 claims per week are cascading into the Department? Will he hold discussions with his colleague, the Minister for Justice, Equality and Law Reform — if he can tear him away from Kerrykeel — and urge him to direct his mind to this issue which is seriously affecting taxpayers? Will the Minister consider an approach which would involve an amendment to the amending Statute of Limitations Act which I believe to be the basic cause of the problem?
Since the day I was appointed, I have grappled with this problem. One of the initiatives I introduced at an early stage related to a new examination of the Statute of Limitations Act to ascertain how it has worked against the State in cases such as this. The 1991 legislation was viewed at the time as very reforming legislation. We have had a number of very traumatic cases such as the hepatitis C cases in which grave wrong was done to women by the State. These would never have been unearthed were it not for such reforming legislation.
Those kinds of cases could be accommodated.
It is very important that we view this issue broadly. We are still considering the extent to which changes could be made in the Statute of Limitations legislation for the future. As this matter has been in the public domain for a protracted period of time and has received a great deal of publicity, I intend to announce a deadline after which claims which come into the Department will be fought rigorously under the current Act.
Does the Minister accept he cannot override the law and must change it if he wishes to change its consequences?
I expect common sense to prevail in the courts on the part of the plaintiffs, their solicitors and everyone else involved.
In view of the 11,000 cases which are outstanding and the fact the Minister spoke about the possibility of a compensation tribunal and is speaking to the plaintiffs' solicitors, it is difficult to understand why he is not talking to PDFORRA, the Defence Forces' representative body, to attempt to put in place a compensation tribunal which would serve to alleviate the problems. Has the Minister met with representatives of PDFORRA since the association's AGM in Ennis? Has he done anything to encourage their involvement in putting a tribunal in place? What is the current state of play between the Minister and PDFORRA?
How many cases have been withdrawn prior to going to court? The Minister stated an extra 40 cases per week were coming into the Department but I am curious whether any are going out.
The Minister stated his intention to introduce a cut-off date for claims. Will that require legislation?
Legislation will not be required to introduce a cut-off date. In reply to Deputy Wall, the state of play between the Department and PDFORRA could not be better. I will meet representatives of PDFORRA later this afternoon.
Are we witnessing the beginnings of a reconciliation? It is not before time.
I held lengthy discussions with Mr. Lucey of PDFORRA a month ago and the association is very interested in taking some initiative in this area.
That meeting was held over a month ago and nothing has happened since.
The Opposition Deputies are never happy when there is a good relationship between the Department and the representative associations.
John Lucey is not the Minister for Defence; it is the Minister who should be taking the initiative.
The Deputy wanted me to talk to the PDFORRA representatives.
I do not have exact figures on the number of cases withdrawn but the combined figure for cases lost and withdrawn comes to more than 100. I will obtain the figure for the Deputy although it is not as significant as we would like it to be.
Written Answers follow Adjournment Debate.
