Criminal Injuries Compensation Scheme 2008

– in the House of Lords at 6:48 pm on 16th July 2008.

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Photo of Lord Bach Lord Bach Government Whip, Government Whip 6:48 pm, 16th July 2008

rose to move, That the draft scheme laid before the House on 18 June be approved.

Photo of Lord Bach Lord Bach Government Whip, Government Whip

My Lords, criminal injuries compensation is part of the Government's wider commitment to put victims at the heart of the criminal justice system. We have transformed the way that victims of crime are supported. Victims now have a legal right, for the first time ever, to a high quality of service from the police, the Crown Prosecution Service and the courts. We have introduced 165 witness care units across England and Wales to support victims and witnesses to attend court. At court itself we have introduced special measures such as giving evidence by videolink or with the support of an intermediary to ensure that victims who are vulnerable or intimidated can give their best evidence.

The criminal injuries compensation scheme is another part of our strategy to support and protect victims of crime. It provides payment at public expense to innocent victims of violent crime in Great Britain. Compensation is based on a tariff, or scale, of awards for injuries of comparable severity. There are 25 tariff bands ranging from £1,000 to £250,000. More seriously injured victims can get additional compensation for loss of earnings and special expenses, subject to an overall ceiling of £500,000 in respect of any one claim or any one death.

Last year the Criminal Injuries Compensation Authority paid out £235 million in compensation, and since the scheme's inception in 1964 it has paid out more than £4 billion to more than 1 million victims of violent crime. Ours is the most generous scheme within the European Union and one of the most generous in the world. For example, in 2007, the United States of America paid out £221,783,000; in the same year, the Great Britain scheme paid out £183,900,000. Considering that the population of the United States is five times greater than ours, the House will acknowledge how generous our scheme is.

In September 2005 we consulted on whether to refocus the scheme on victims of the most serious crime while also improving the practical and emotional support available to victims. Many respondents to the consultation wanted the practical and emotional support it proposed. We have taken this forward through the victim support plus model, where Victim Support contacts the victim within 48 hours of referral from the police and a thorough needs assessment is carried out identifying the individual support needed. But respondents also commented that these direct services should not be at the expense of awards for less serious injuries. We agree. We will not, therefore, be refocusing the scheme and have funded Victim Support to roll out its model of practical and emotional help across the country.

Criminal injuries compensation does not exist in a vacuum. It is intimately linked to the other support, protection and information that victims of crime receive from the criminal justice system. When we started the Rebuilding Lives consultation we were at the start of a major period of reform—for example, the introduction of witness care units and the victims' code of practice. We wanted to be clear on the results of these reforms before making any changes to the scheme; in particular, we were keen to see the results of Victim Support's new victim support plus scheme. In these pilots, 88 per cent of victims said that they felt their needs were completely met, and 92 per cent of victims judged the quality of service to be excellent or good. So the success of its pilots influenced our decision to roll out that initiative across the country, just as it influenced our decision not to refocus the scheme but to instead look at making its administration more efficient and more victim-focused.

As a result, the main changes we are bringing before the House relate to the appeals provisions of the scheme. These have become necessary as a consequence of the Tribunals, Courts and Enforcement Act 2007. The provisions that we are inviting noble Lords to approve today are therefore mainly focused on these changes, and the basic structure and rules of the existing scheme will remain much as before.

The criminal injuries compensation scheme currently in operation incorporates the functions of both the Criminal Injuries Compensation Authority and the Criminal Injuries Compensation Appeals Panel. The main reason for bringing these changes before the House is the 2007 Act, which creates a two-tier tribunal structure, the first-tier tribunal and the upper tribunal, and requires that the Criminal Injuries Compensation Appeals Panel, along with a number of other government tribunals, will be absorbed in the first-tier tribunal on 3 November this year. From that date, the Criminal Injuries Compensation Appeals Panel will cease to exist as a separate body and therefore cannot remain part of the criminal injuries compensation scheme. From the same date, the appeals rules and procedures of the first-tier tribunal will be set out within the relevant tribunal procedure rules, which have yet to be laid before the House. That is why the coming into force date of this draft scheme is 3 November.

As opportunities to amend the scheme arise so rarely, we also want to make a number of other changes. These have become necessary with the passage of time since the scheme was last changed in 2001 and in the light of operational experience. In the main, they are needed to clarify meaning or intent where there is doubt or ambiguity, to provide greater clarity, to restore the original intention of the scheme where court judgments or operational experience suggest that the previous wording was not doing the job, and to help streamline some scheme processes. All the changes are clearly set out in annex B to the Explanatory Memorandum that has been laid before Parliament with the draft scheme. The changes are all clearly shown as "tracked" changes, and I shall briefly mention some of the more significant ones.

Perhaps most importantly, we have substantially recast the paragraphs dealing with additional compensation for loss of earnings and future earning capacity; the payment of awards in fatal cases; and the reduction of compensation on the grounds of benefits received from other sources. Our aim was to modernise the rules to make them simpler and more logical, and to avoid cases of claimants getting double payment from the state in some circumstances.

As to other changes, we have made it clear in paragraph 8 that not only must the injury have been sustained in Great Britain but it must have been directly attributable to an act occurring in Great Britain. This is specifically to clarify the original intention of the scheme that both the incident and the injury must have taken place in Great Britain. For example, following the 9/11 terrorist attacks in the USA in 2001, the authorities there determined that qualifying relatives of those killed and who had witnessed the events on live television in Great Britain were eligible for compensation for the mental injuries suffered. Thirty-seven applications were made, of which 26 received awards, totalling £68,000. Our scheme was never intended to cover such cases and this alteration puts the meaning beyond doubt.

We are strengthening the criteria for withholding or reducing awards on account of the claimant's previous unspent criminal convictions and the criteria dealing with time limits for applying for compensation and accepting offers of award. The reason for clarifying how long an applicant has to apply is that the time limit for making applications has been set at two years since the introduction of the statutory tariff-based scheme in 1996. The power to waive that time limit has been used frequently, but inconsistently, within the authority and this clarification is to insure against anomalies or unfairness.

We have not altered the number and value of the 25 tariff bands but we have made a number of changes to the tariff of injuries. We have made changes to some of the descriptions of awards for sexual offences using terminology from the Sexual Offences Act 2003 to ensure consistency, and we have inserted some new categories and made some other changes to rectify inconsistencies. We have substantially recast the section dealing with compensation for brain damage to recognise the wide range of brain injuries and to enable the award to be more closely aligned to the injury suffered. We have increased the awards made payable for injuries to teeth in recognition of the reality that victims will often have to use some of the award to pay for corrective dental treatment.

We have also inserted a number of new injury descriptions, changed the descriptions of others and moved one or two injuries into higher or lower tariffs where operational experience and medical and legal advice have suggested this would now be appropriate. The tariff now lists some 450 injuries. If parliamentary approval is given, as I have said, the draft scheme would come into force on 3 November 2008.

We believe that the changes we are proposing will complement the radical changes that the authority has been making to its end-to-end case working and business processes over the past two years or so. I am happy to say that these changes have already led to improvements in how the authority operates. This will all help to result in a more efficient operation, providing a better, faster and more transparent service to victims of violent crime and making the best use of the available resources. I commend the draft new scheme and invite the House to accept it. I beg to move.

Moved, That the draft scheme laid before the House on 18 June be approved. 23rd Report from the Joint Committee on Statutory Instruments.—(Lord Bach.)

Photo of Lord Henley Lord Henley Shadow Minister, Justice 7:00 pm, 16th July 2008

My Lords, I hope that I can be relatively brief. On Monday, my honourable friend David Burrowes debated this at some length with the Minister's colleagues in another place. Most of his questions about consultation were dealt with on that occasion, so I want to add only a couple of points.

First, to pick up one of the Minister's last remarks, he talked about the increase in awards for dental treatment for damaged teeth. If people have to pay a lot more for restorative work for teeth, that seems to suggest that there are considerable failings in NHS dental services on that front. I would be interested in his comments on that.

My second point, which is more substantive, is about the various orders relating to the transfer of tribunal functions, which I understand we will be dealing with on our first day back, 6 October. The Minister will be aware that I recently saw his colleague, Mrs Bridget Prentice, about those orders because of some concerns that we have had about them. Mrs Prentice promised that there would be further consultation on those orders and said that they might have to be relaid—nothing to do with the criminal injuries compensation scheme, but purely in relation to Pensions Appeal Tribunals and matters relating to war pensioners. If they are not amended and there are disruptions, as it were, in this House and the orders do not go through, what will happen to the scheme that we are going to agree to on this occasion, the Criminal Injuries Compensation Scheme 2008? It is important that the Minister addresses this question. The two have to go together. It is important that we have the new tribunals in place, but, as the Minister is well aware, we cannot amend those orders if there are problems with the Pensions Appeal Tribunals when we come to discuss this on our first day back.

My next question for the Minister is, I appreciate, a difficult one. His department, in its Explanatory Memorandum, which is good and very clear, reckons that compensation claims amount to something in the order of £200 million a year. He was quite right to emphasise the generosity of the scheme that is in place now and how it compares with similar schemes in the United States. I appreciate that he cannot say whether the Government estimate that the scheme will increase in future, but it would be helpful if he could tell us how much it has grown over the years and how much of that growth is due to inflation and how much to a growth in the number of claims. That is, what is inflation and what is an increase in crime or perhaps an increase in awareness of the scheme and the fact that people feel that they have an entitlement to claim on that front? I leave the Minister with those questions and I would be grateful if he would assist me when he comes to reply.

Photo of Baroness Falkner of Margravine Baroness Falkner of Margravine Spokesperson in the Lords, Home Affairs

My Lords, like the noble Lord, Lord Henley, I see that my colleague, Mr David Howarth, dealt comprehensively with the scheme in another place just a few days ago. I will therefore keep my remarks brief.

Like Mr Howarth, I am pleased that the scheme does not pursue some of the ideas in Rebuilding Lives that would have been rather damaging. I particularly welcome the fact that the Government have not proceeded with a proposal to exclude victims who suffered the crime at work, as that would have been quite unjust. A suggestion was made in the consultation paper that the employer should take on that burden and pay compensation through insurance. That would have undermined the entire scheme, so I am glad that it is not being proceeded with. I hope that the Minister can assure us that there is no intention at any point to bring that idea back.

I have two specific points about the detail of the scheme. Paragraph 35(1)(d)(iii) deals with care costs, but there seems to be a change from the 2001 scheme in that regard. The new scheme restricts care costs to applicants' core costs, such as the cost of helping them with bodily functions and meal preparations, whereas the previous scheme seemed to deal with all one's care costs. Why has that change been made? Is it justifiable to place the extra cost on the individual victim?

In a similar vein, I have a question about the earnings limit. Financial loss under the criminal injuries compensation scheme is restricted, unlike civil liability damages, to one and a half times average earnings, so someone cannot get whatever earnings they have lost; they are limited to one and a half times the average. However, the definition of "average earnings" appears to have changed from the one used in the 2001 scheme. In 2001, "average earnings" were defined as "gross average industrial earnings", whereas in the new scheme they are defined as "median gross weekly earnings". Why has that change been made? What difference is it expected to make? On the face of it, given that earnings are skewed with a very long tail at the high end, changing that average, which meant "mean", to this average, which means "median", represents a reduction in the amount of money available. On the other hand, changing from industrial earnings to earnings in general might have the opposite effect. What is the change expected to do?

Besides that, we have covered the ground fairly comprehensively between the two Houses, and we on these Benches are broadly content with the scheme.

Photo of Lord Bach Lord Bach Government Whip, Government Whip

My Lords, I am grateful to both Front-Bench spokesmen for what they have had to say and for their support for the scheme and I thank the noble Lord, Lord Henley, for his praise for the Explanatory Memorandum.

The noble Lord asked a number of questions. The first one was about teeth. I reject utterly his suggestion that somehow this has had something to do with a decline in the way in which dental practice occurs in this country. In our view there has been a considerable improvement, and I do not say that just because sitting beside me is the former Minister in charge of dentistry throughout the country. The fact is that awards for injuries to teeth are being increased to reflect the fact that the necessary corrective dental treatment is sometimes not available—that is the reality of the situation in the NHS—and the victim has to use the compensation award to meet the costs of treatment. We would have been criticised if we had not agreed to that. Although paragraph 35 of the scheme allows for the cost of private health treatment, including dental work, that provision does not take effect until the first 28 weeks of loss. The amendment helps victims who are not incapacitated for 28 weeks but still need to meet some of their dental costs.

As for the noble Lord's remarks and his question about orders, the issue is extraordinarily hypothetical. I can tell him that my honourable friend Bridget Prentice, whom he referred to, has had some helpful discussions with veterans' associations. No doubt we can look forward with delight to a good debate on our return after Recess; in fact, it may be what keeps us going during those long weeks away. With regard to the impact of the situation on this statutory instrument, it does not affect the scheme changes. If the date of the coming into force of the tribunal SI is delayed, we will amend the coming into force of the scheme by negative resolution.

The noble Lord also asked about the scheme's growth over a number of years. It will be best if I write to him with a table of the increases paid each year. I opened this short debate by saying that £235 million had been paid out in the last year, which was a considerable increase on the previous year. What matters to innocent victims of crime is that their applications, if they come within the scheme's ambit, should be paid as quickly as possible. I am happy to say that our record on that has improved markedly since 2006.

I am also grateful to the noble Baroness, Lady Falkner, for her comments, although I am not sure that I am so grateful for her extremely detailed questions. However, as she knows, I did have some notice of her questions. Let me deal first with care costs. These provisions often have something in common with previous benefits legislation. The amendment on care costs, which the noble Baroness picked up, follows the wording of Section 72 of the Social Security Contributions and Benefits Act 1992—it has taken us a bit of time to catch up with that wording. The intention is to make existing practice clear. Only core personal care costs are covered; these include dignity-based help that people need if they have been incapacitated, but not social care costs or peripheral costs such as arrangements for having housework or gardening done. We tend to see this amendment as a clarification rather than a change in emphasis.

The noble Baroness also asked about earnings. The change of the loss of earnings calculation from one type of Office for National Statistics figure, which is no longer to be produced, to another has the effect of changing the arrangements from mean to median. We think that the practical effects—I hope that the noble Baroness will be content with this—are negligible, as most victims do not earn one and a half times the median gross weekly earnings. Individuals may be affected, but we are faced with the practical problem of not having the figures that the ONS used to produce to keep things in line with how they previously were.

Photo of Baroness Falkner of Margravine Baroness Falkner of Margravine Spokesperson in the Lords, Home Affairs

My Lords, I thank the Minister for that. Would he be able to provide figures in writing on how many people this might affect?

Photo of Lord Bach Lord Bach Government Whip, Government Whip

My Lords, I will take that away and see whether figures can be provided. No doubt they will be hypothetical at this stage, but we will do that. However, we do not think that this will make a huge difference.

I return briefly to the noble Lord, Lord Henley. I now have figures on the value of all payments—interim and final—over the last number of years. I will, of course, send those to him and to the noble Baroness, Lady Falkner. The figures have gone up from £20 million in 1996-97 to £207 million in 2007-08. The difference between that and the £235 million is due to the fact that some are still being paid under the old tariff system. I have done my best to answer the questions. I thank noble Lords again for supporting this scheme.

On Question, Motion agreed to.