Examination of Witnesses (Questions 100-117)
1 MARCH 2005
Mr Martin Trainer, Mr Jeff Wilson, Ms Kate Roy
Q100 Mr Clapham: Would
it be fair to say that in some cases it may appear that the use
of the adjusters has introduced another adversarial tier?
Mr Wilson: It may appear like
that, but we are committed to moving these claims through the
process and we are committed to the right decisions being made
and the right compensation being paid to the claimants. These
are individuals who are employed by Capita and the standard that
we set is they have to be consistent in the decisions which they
make. At the end of the day, there will always be a proportion
of claims which come through that will be denied and those that
tend to be the case are claims which are contested.
Q101 Judy Mallaber: Following
on from that, the solicitors were complaining to us about requests
on the VWF Services Agreement for irrelevant and inappropriate
information and they were being asked for information which they
did not see was relevant and that was resulting in delays. Is
that not a problem which you recognise at all?
Mr Wilson: Obviously in any scheme
we have to have evidence to support a claim. We are required to
ask questions to check that level of evidence. We ask questions
to support a claim so we can decide on the compensation to pay.
Q102 Judy Mallaber: The
Claimants' Group told us that in some instances you have been
responsive to complaints about the conduct of individual cases
and you put matters right, but that seemed to be dealt with very
much on a case-by-case basis. They said you did not seem to share
that knowledge amongst claims adjusters to make sure when a mistake
was made in one case it was not repeated elsewhere. Is that fair
and what steps do you put in place to make sure there is a spread
of best practice and to stop any errors being duplicated?
Mr Wilson: I think they may be
referring to the time when we talked about the Services Pilot
which was a couple of years ago, where in that period we invited
solicitors in to discuss with us seeing things from the other
side. What we have done since then is to constantly measure performance
across all claims in terms of quality assessments and checking.
We constantly discuss experiences and give training advice based
on any issues which arise from monitoring groups and meetings
with the Claimants' Group.
Q103 Judy Mallaber: You
are confident that experience is fully shared and once you have
discovered one way of doing things, which maybe was not quite
right, that is passed on to all your other claims adjusters?
Ms Roy: From an operational perspective,
we have some fairly rigorous internal audit procedures and processes
where, by checking individual claims and looking at the quality
of claims handling decisions being made within those claims, we
analyse the outputs from that, we feed that back in not only to
our training programmes, we deliver it back to the individuals
concerned and we learn lessons across our technical team. It is
the case that some of those claims have continued to evolve over
the last few years, whilst the Agreements were signed some four
or five years ago. We are still making new decisions within the
process, so there is a constant need to review how the operation
will implement a legal decision or a legal agreement which has
been reached and there is a need for us to constantly review how
effective that is. Feedback from the solicitors is exceptionally
helpful in these instances.
Q104 Judy Mallaber: You
are happy when we write to you about things?
Ms Roy: Absolutely.
Q105 Sir Robert Smith:
One of the concerns raised with us, dealing with the Vibration
cut-off, is the deadline set by the court for submitting evidence.
Do you anticipate a surge in claims because of people trying to
get in before the deadline?
Ms Roy: Across both schemes we
have managed the VWF general damages cut-off both for live and
posthumous claims. We have managed the fairly significant operational
spike which came around with the COPD cut-off in March last year.
We have just managed the VWF wage loss cut-off which took place
on 31 January. We have fairly advanced planning in place, from
an operational perspective, to manage the services cut-off which
is scheduled for the end of this month. We have plans in place
to manage the cut-off for Group 3 evidence submissions at the
end of June. All of these cut-off processes have been formally
managed through standard project management processes in partnership
with the DTI involving other stakeholders and solicitors where
necessary. Certainly the COPD case is an example with large numbers
and it was planned for over nine months to ensure that we could
successfully secure the cut-off.
Q106 Sir Robert Smith:
Is the aim that the cut-off will not affect other claims?
Ms Roy: Our experience would be
no.
Q107 Mr Berry: Can we
turn to fraudulent claims. How big a problem is this?
Ms Roy: To paint a picture in
relation to our position as the appointed claims handlers, our
primary role is to accurately disburse public monies in terms
of compensation to over three quarters of a million claimants
across both schemes. The Claims Handling Agreements clearly set
out how those payments should be made, so we have a number of
internal screening and validation processes which ensure we get
the right level of compensation to the right claimant at the right
time. Taken in that context, there is a requirement, with the
levels of public money which we are involved in, to have fairly
robust procedures where those validation processes suggest there
might be something which potentially needs some further investigation.
In context, out of the three quarters of a million claims we are
currently processing, so far 1,500 have been referred for some
further investigation where there may be some potential concerns
around those validation processes.
Q108 Mr Berry: The DTI
in their submission said that there have been 1,500 cases registered
as potentially fraudulent. Do you know how many are fraudulent?
Ms Roy: There is a distinction
to be made between a fraudulent prospective, where we are looking
for evidence of intent to mislead, and where there may be a degree
of exaggeration involved within the claims handling process. The
claims handling processes themselves are designed to identify
that if someone does not meet the criteria, they do not progress.
In relation to those who have been concluded so far, of the 800
concluded investigations, 300 have resulted in either a reduction
in overall compensation being paid or a prevention of that compensation
being paid.
Q109 Mr Berry: Last week
the solicitors expressed some concern about the tactics adopted
by fraud investigators. Is it right that when applicants are being
investigated they are not given a clear idea of why they are being
investigated and what the issues of concern are?
Ms Roy: In the small number of
instances where there is an external investigation involved, the
process for the external organisation will always be, first of
all, to correspond with the claimant's representative and seek
their permission to contact claimants, and each claimant representative
is given the option to attend an interview or be involved in any
subsequent correspondence between both of those parties. We recognise
that the claimants within this process have a right to representation
at every step of the process, and we continue with that during
the external investigation as well.
Q110 Mr Berry: Does the
claimant or the claimant's representative know the reason why
the investigation is taking place? Are they told, "our cause
for concern is . . . " or is it a trawl?
Ms Roy: They will be made aware
that this has been highlighted as having the potential for further
investigation.
Q111 Mr Berry: Do your
investigators operate under DTI guidelines?
Ms Roy: Our investigators are
an external organisation, part of the Cantor Group, who are compliant
to FSA standards. They operate within the insurance industry,
which is tightly governed by FSA standards.
Q112 Mr Berry: In the
DTI's submission, interestingly, the question about the guidelines
which claims handlers use to identify potentially fraudulent cases
is referred to, and we are told that these were intended as internal
documents, and that is why they are not in the public domain.
There would be no reason, would there, why these guidelines could
not be provided to the Committee in confidence?
Mr Trainer: They are certainly
documents that are agreed with the Department. As to whether they
could be provided to the Committee, we have no objections to that,
but that is a matter I suggest you might want to raise with the
Department.
Mr Berry: Thank you. I think we will.
Q113 Chairman: Am I right
in thinking that from the figures you have suggested there are
1,500 out of 750,000, so it is about 2%?
Ms Roy: 0.2%.
Q114 Chairman: We have
spoken about the fact that you are incentivised, and it is understandable
that we have that, but we have now got a series of aspirational
end dates. Are they more realistic than aspirational, or more
aspirational than realistic?
Ms Roy: In the early part of last
year, we alongside other contractors were involved with the Department
in looking at ways in which we could bring some closure for the
claimants within VWF scheme. As a consequence, we, in partnership,
created seven aspirational end dates in relation to the various
stages of the VWF process. By enhancing our planning capabilities
and forecasting methodologies during the course of last year,
we have now some confidence over both the realistic elements of
these end dates and, consequently, our ability to deliver them,
subject to the co-operation of all parties, so if certain assumptions
take place, we can plan and forecast much more accurately now.
There is a recognition that we are only one part of the big process
here, and all stakeholders need to be engaged.
Q115 Chairman: So with
all these qualifications would we be right in assuming that complete
investigation of Group 3 claims will be achieved by the end of
quarter three of this year; that you will be able to finish services
MAPs by the end of 2006 and settle all service claims by the end
of 2007? Do you think these are realistic?
Ms Roy: Yes, we do.
Mr Trainer: I would just like
to put a couple of caveats to that. Firstly, as Kate said, there
is significant interdependence between ourselves and the claimants'
representatives, and the claimants' representatives need to buy
into these timescales and targets and do their part of the piece.
Secondly, our contract expires in 2006 so if we are still involved
beyond 2006 we are confident, but obviously it remains to be seen
whether that is the case.
Q116 Chairman: You have
been parachuted in here. Do you have any regrets? Do you wish
you had never started?
Mr Trainer: Absolutely not.
Q117 Chairman: It is not
uncommon for us to find that people come in as visiting fire people
or whatever, and they say, "God, we wish we had never got
into this".
Mr Trainer: If I go back 15-16
months ago, I guess when I first became aware of the scheme I
was quite astonished, to be honest, that something of this scale
and magnitude was going on. Outside of the mining areas it was
not widely known what was going on. Having got into the process
and met the team and seen what is going on, it is a wholly worthwhile
endeavour, and we are very proud of what we do and we are very
pleased to be doing it.
Chairman: Let us hope we do not have
to call you in again and say, "why have you not done this?"
Certainly I would not, but some of my colleagues may well do.
Thank you for your evidence. If there is anything else that we
need, we will get back to you, but you have been very helpful.
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