Draft Victims of Overseas Terrorism Compensation Scheme 2012
Draft Criminal Injuries Compensation Scheme 2012
The Committee consisted of the following Members:
Alison Groves, Committee Clerk
† attended the Committee
The following also attended ( Standing Order No. 118(2) ) :
Victims of Overseas Terrorism Compensation Scheme
Proper support for victims and witnesses is a priority for this Government. The public expect the criminal justice system to have the interests of those who have suffered at its heart. That means that there should be decent treatment of victims and witnesses during trials and the provision of support in the aftermath of crimes; that as far as possible criminals, not taxpayers, should pay the bill; and that those who have been seriously injured should be able to count on sensible compensation.
Our system falls short of those ideals. I will leave discussion of delays in the system and stopping reoffending for another day, but in relation to treatment, victims and witnesses are too often left feeling like accessories to a system during investigations and trials, being kept in the dark about their case and expected to sit next to perpetrators’ families in court. In relation to emotional and practical help in the aftermath of crimes, the right services are often not available or are spread too thinly. Victims are left to pick up the pieces, and taxpayers to pick up the bill. Compensation works in an opaque and bewildering way.
To sort all that out, in January we launched our consultation “Getting it right for victims and witnesses”. Part 1 of the consultation set out proposals to ensure that victims and witnesses receive the support they need, whether through a new victims code, more restorative justice or more use of the victim personal statement. Those proposals should all help to improve the experience of victims and witnesses in court. Part 2 focused on reforms to the criminal injuries Compensation Scheme and our plans, which are not subject to consultation, to make payments to victims of overseas terrorism.
We published the Government response to the consultation in July, and the plans were broadly welcomed. The reformed draft criminal injuries Compensation Scheme was approved by the House of Lords before the summer recess. However, when it was discussed in a Delegated Legislation Committee in September, hon. Members raised concerns. I said that the Government would take away and consider those concerns, which my right hon.
Let me explain the overall ambitions of the reforms, which must be understood in the context of all the changes we are making to support victims and witnesses, not taken in isolation. My key point is that we are broadly seeking to maintain overall spending on victims; not to cut it, but to change its composition, so that the money is used more effectively.
Right now, there are two salient facts about the criminal injuries compensation scheme. First, it is in serious financial difficulties. Despite a substantial budget of about £200 million, it sometimes relies on emergency cash top-ups at the end of the financial year to remain solvent. Overall scheme liabilities are in excess of half a billion pounds. We are still resolving claims made under the pre-tariff system that operated up to 1996.
We made extra funding available to pay the older claims, but pre-tariff liabilities stood at about £150 million at the beginning of this financial year. Clearly, the scheme must be put on a sustainable footing if it is to continue to make timely compensation to victims in the long term.
Secondly, the design of the criminal injuries Compensation Scheme is flawed. Compensation is in some cases poorly targeted, with millions of pounds being spent on relatively minor claims such as sprained ankles. Indeed, over the past decade, nearly £60 million has been paid to 19,000 claimants who are convicted criminals. Instead of taking money from an unaffordable scheme and using it to give cash to those with minor injuries months, and sometimes years, after the event, our plans seek to make a structural change in the nature of the help we give to victims.
The first change was to reform the criminal injuries Compensation Scheme so that it focused on the most serious cases involving innocent victims and on reducing the burden on the taxpayer by £50 million. The second change, which is separate but part of the package, was to increase spending on services for victims by a similar sum. Crucially, however, that will be paid for by criminals, out of their pockets. The new victim surcharge arrangements, which we implemented on 1 October, will mean a lot more offenders paying towards victim services. From the surcharge and other sources, we will raise up to an additional £50 million from offenders.
I will speak in more detail about the changes to the scheme in a moment, but let us be clear about the overall approach. Seriously injured people need to be able to rely on compensation, and our changes will protect the criminal injuries Compensation Scheme for the long term. Meanwhile, victims should get better services as a result of the additional funding. Practical and emotional support is what those who have suffered from crime say they need, and we believe, as a matter of principle, that that is a better priority than compensation for lower-end injuries.
Not only is that responsible at a time of economic hardship, but it is fair, and I believe that most of the public would accept it as such. All that was the rationale for the scheme that we brought to the Committee in September.
We have listened carefully to the comments made, but the fundamentals of the case for reform have not, in our view, changed. Against that backdrop, we have decided to proceed with our changes to the criminal injuries compensation scheme without amendment. We believe that that is the correct way forward. Reform is necessary and right, but we want to make separate provision to ensure some flexibility. In particular, we want to protect certain people whose injuries will fall outside the scheme and who are low-paid and find themselves temporarily unable to work. I will say more about that provision in a moment.
Turning now to the detail of the scheme, the tariff of injuries is a key change area. Tariff payments will be available to those most seriously affected by their injuries, and to those who have been the victims of the most distressing crimes. In practice, that means that bands 1 to 5 of the current tariff, which contain more minor injuries such as sprains and minor fractures, will be removed.
Mr Smith: Does the Minister accept that the tariff bands that she describes as covering minor injuries also cover permanent speech impairment, partial deafness lasting more than 13 weeks, multiple broken ribs, post-traumatic epileptic fits, burns and scarring causing minor facial disfigurement, and the results of needle attacks by assailants brandishing hypodermic needles? Does she really think it right to exclude victims of such injuries from compensation?
Mrs Grant: The current system is not sustainable, sadly. It is not sensible. It needs to be simplified. It must also be remembered that there are often other avenues through which claims can be made by those who are unfortunately put in such a position, for example civil litigation, insurance, the NHS and benefits. Regarding the particular injuries that the right hon. Gentleman mentioned, I emphasise that where an injury is sufficiently serious and the applicant will not make a complete recovery, a claim can still possibly be made.
What that means in practice is that bands 1 to 5 of the current tariff, which contain minor injuries such as sprains, will, as discussed, be removed. Bands 6 to 12 are reduced by between 60% and 24%, but bands 13 to 25 are to be protected in their entirety at existing levels. In addition, the Committee will wish to note that tariff awards for sexual offences and patterns of sexual abuse
Our tariff reforms attracted criticism when the Committee met on 10 September, particularly in relation to the impact on the low-paid, and we listened carefully to that. As with other applicants to the scheme, if the injuries are sufficiently serious, victims will be eligible. They will also, like other victims, benefit from the additional services funded by offenders.
We are not persuaded that the tariff changes are wrong. However, a case has been made for helping very low earners, whether employed or self-employed, who, as a result of the removal of bands 1 to 5, may find themselves in real and immediate financial hardship. That is why I am announcing today that a £500,000 hardship fund has been established for people who are temporarily unable to work and who are not in receipt of statutory sick pay or an equivalent employer-provided scheme. Our intention is that the fund will be available to help eligible applicants keep their heads above water. We will publish full details shortly.
Robert Flello (Stoke-on-Trent South) (Lab): On a point of order, Mr Dobbin. Is it in order for a Minister to come to a Delegated Legislation Committee, refer to a scheme that is directly relevant to what we have before us in the scheme, and talk about the fact that it is not even tabled for this scheme?
The fund will be administered by the Criminal Injuries Compensation Authority, but applicants will need to be referred to the authority by victims organisations, such as Victim Support. We will ensure that applications are processed quickly and payments made promptly, so that victims are not left incurring debt.
The next element of the scheme that I want to look at is eligibility. We have defined that more tightly, so that only direct and blameless victims of crime who fully co-operate with the criminal justice process obtain compensation under the scheme. Applicants will need to be able to demonstrate a connection with the UK through residency or other connection. However, in the light of responses to our consultation, we reconsidered the original proposal that an applicant should have been resident in the UK for six months before the
Bereaved relatives of victims who die as a result of their injuries will continue to be able to make a claim, as long as they meet the revised eligibility criteria. Those with unspent convictions will not be able to claim if they have been sentenced to a community order or imprisoned. Those with other unspent convections will be able to receive award only in exceptional circumstances.
Another criticism of our reforms is related to dog attacks, specifically to the change that addresses an existing anomaly linked to eligibility. At the moment, the Criminal Injuries Compensation Authority will consider applications for compensation for injuries caused by dogs in the following circumstances: the person in charge of the dog deliberately set it upon the applicant; the dog is one of a type specified in the Dangerous Dogs Act 1991 and was not kept under proper control; or the person in charge of the dog, which they knew was vicious towards humans, failed to control it. Under our changes, the Criminal Injuries Compensation Authority will in future pay only where the dog was set upon the victim by its owner; in other words, where it was used as a weapon.
Teresa Pearce (Erith and Thamesmead) (Lab): Will the Minister explain how it can be proven that someone had set a dog on someone else? I was attacked by a dog during the election campaign. It was not set upon me, but it viciously attacked me. How would it be proven in law that someone had instructed a dog?
Mrs Grant: It would depend on the individual case. There might have been witnesses, and if there were no witnesses, I am sure that the hon. Lady’s own evidence of the attack that she sustained during the election campaign would be admissible in court.
Katy Clark: Does the Minister agree that if the Government intend to go down this path, surely they should legislate on compulsory insurance for dog owners so that those who are the victims of dog attacks—for example, the lady who is on the front page of today’s Daily Mirror and the many young children who are the majority of victims of such attacks—have compensation in another way?
Mrs Grant: If the hon. Lady waits a moment, I will go into that in quite some detail. The Government, of course, take irresponsible dog ownership seriously, and we will do everything we can to tighten up. I was very saddened to hear of the dreadful incident that happened recently, near to where I am located.
While we may well have considerable sympathy for someone who has been hurt, for example, someone badly injured in a car crash that was caused by someone who walked into the middle of a motorway in order to commit suicide, that was not what the scheme was for. We have listened to the arguments made, particularly on behalf of postal workers, but we are clear that the change to the scheme is right. Our critics have asserted that the numbers receiving payments for dog attacks
The Sentencing Council recently issued a new sentencing guideline for dangerous dog offences, which will increase the average sentence for offences involving injury and encourage courts to consider requiring the offender to pay a compensation order to victims. That will be supported by the strength and duty in the Legal Aid, Sentencing and Punishment of Offenders Act 2012, which, once implemented on 3 December, will require courts to consider a compensation order in all cases involving injury, loss and damage.
The next element of the scheme is loss of earnings. These payments do not at present reflect actual loss for all applicants being capped at a salary of one and a half times the median gross weekly earnings, but they make up a significant proportion of the cost of the scheme. The new calculation for loss of earnings will be a flat rate based on statutory sick pay, which should be simpler to administer. Payments will no longer be subject to deduction for benefits. They will be available only to those who can no longer work or who have very limited capacity to do so, in line with our focus on those most seriously affected by their injuries.
On special expenses, we have retained the vast majority of them in their entirety. Special expenses payments will continue to be available for the same categories as under the current scheme with the exception of private health care, which has been removed. We chose to retain these payments because they are generally awarded to those who suffer the most serious injuries. However, we have made it clear that the scheme should be one of last resort in relation to special expenses, and that payments will be made only if a claim is reasonable.
On fatal cases, we are protecting the awards for bereavement and parental services payments. In the interests of consistency and fairness, dependency payments in fatal cases will be made in line with the revised plans for loss of earnings. The scheme can never compensate someone fully for the death of a loved one, but we believe that some financial compensation is appropriate in these cases. Reasonable funeral expenses will be made, up to a maximum of £5,000.
On process, one of the aims of the reforms is to make the scheme easier for applicants to understand. For the first time, the evidence required to make a claim is being put on the face of the scheme. We are tightening the circumstances in which the authority will meet the costs of obtaining medical evidence and reducing the time scales for submission of review applications to the authority.
The debate is also about the draft statutory scheme for compensating victims of overseas terrorism. I am sure the Committee agrees that terrorism is a political statement and an attack on the state. As such, terrorism
Members may recall that we opened an ex gratia scheme in April 2012 to make payments to victims of overseas terrorist attacks going back to 2002. The statutory scheme is based on the draft criminal injuries compensation scheme, and, like that scheme, it will provide for payments to be made for injuries, loss of earnings and special expenses. The statutory scheme will make payments to British and EU victims of overseas terrorism who are resident in the UK. An injury will have to be attributable to a designated terrorist act, rather than to a crime of violence, with the task of designation falling to my right hon. Friend, the Foreign Secretary.
The Government believe that the Draft Criminal Injuries compensation scheme provides a coherent and fair way to focus payments towards those most seriously affected by their injuries within a sustainable budget. The scheme should be seen alongside our efforts to increase funding for victims’ services, with the ambition that overall funding for victims remains the same. The scheme for victims of overseas terrorism will provide financial support to those who sustain injuries abroad during a terrorist attack or who are bereaved by such an attack.
The Minister came to the previous Delegated Legislation Committee on these measures having supported the proposed cuts to the scheme, but in the face of a revolt on her Benches urging her to think again, she said:
“I have listened very carefully to what hon. Members on both sides of the Committee have said today about the scheme. I am a new Minister and, having taking some advice and thought very carefully about everything that has been said and the importance of the scheme to people whom we all care about, I have decided not to move the motion”.—[Official Report, First Delegated Legislation Committee, 10 September 2012; c. 25-26.]
So she gave the impression that she would go away and think again, but we should have known better. We should have known that in the drive to make the new Justice team look much tougher than the previous team, despite the fact that that is all spin, she, too, would have to look tough.
So what changes did the Minister make? Did she recognise the incredulity at her suggestion that permanent speech impairment is a minor injury by reinstating compensation for bands 1 to 5? I am afraid she did not. Was she tough on the administration costs of almost £20 million by diverting some of those funds to victims? No, she did not. Did she accept that it is wrong to cut dramatically the amount of compensation to victims in bands 6 to 12, such as those with a permanent brain injury? No, she did not. Did she go away to think about how limiting loss-of-earnings compensation will mean that, if a murder victim had a short period of unemployment in the previous three years, their children would be denied any payment? No, she did not. Finally, did she go away to work out how to reverse the unfairness
I am sad to say that the Minister went away from that Committee to work out how to ensure that today her side of the Committee contains loyalists and Parliamentary Private Secretaries, and, just to be sure, Members were kept waiting to see whether the Government would introduce changes until the last possible moment. The Secretary of State, of course, wrote only to Government Members in his official capacity to try to set out why this abomination of a scheme should be supported.
Importantly, for those Parliamentary Private Secretaries, loyalists and former Ministers on the Government Benches I will briefly explain how the scheme came about. In a 1962 House of Lords debate on the “Report of the Working Party on Compensation for Victims of Crimes of Violence”, the then Lord Chancellor, Lord Dilhorne, told peers:
In 1964, the Criminal Injuries Compensation Board was established, and it became the Criminal Injuries Compensation Authority, which administers the criminal injuries compensation scheme. I draw Government Members’ attention to the important statement that sympathy alone is not enough.
There are many myths and fabrications about this scheme, so let us be clear. This is a scheme of last resort. It is designed to provide some measure of recompense to victims of crime who cannot get recompense elsewhere. It is also not a generous scheme, but at the same time the funds it currently provides are much needed by those who receive them. Despite what we have heard yet again today, the scheme also has a quite stable spending pattern, so the financial security of the scheme cannot be an issue. Indeed, the average cost over the past four years has been £192 million, which is within the £200 million set aside to cover the scheme, and the impact assessment, which, interestingly, is not on the table today, backs that up. We should remember that the scheme covers 30,000 to 40,000 people a year who have no other recourse to compensation.
Government Members should be under no illusion as to what the revised scheme will do. Almost half of the total number of victims applying for compensation in bands 1 to 5 will no longer be eligible for any compensation. As the Committee has heard, bands 1 to 5 include injuries such permanent speech impairment, partial deafness lasting more than 13 weeks, multiple broken ribs, post-traumatic epileptic fits, and burns and scarring causing minor facial disfigurement. People suffering those effects will receive nothing at all—not a penny—under the revised scheme. On the radio this morning, a gentleman was being interviewed about his being assaulted. His head was stamped on and his jaw now clicks from time to time. He will not get anything as a result of the revised scheme. Is that fair? Is that right?
More than one third of the total number of victims applying for compensation in bands 6 to 12 will see their compensation reduced. Just to remind the Committee, bands 6 to 12 include injuries such as significant facial scarring, permanent brain injury resulting in impaired balance and headaches, penetrating injury to both eyes, fractured joints, including elbows, both knees, and vertebrae,
Only 17% of victims with the most serious injuries will see their compensation unchanged—not improved, but unchanged. However, many of them will still suffer as payments for loss of earnings will be reduced from the victim’s average earnings to the level of statutory sick pay. When the Minister mentioned how that will simplify the scheme’s administration, I found it amazing that I heard no mention of how the £20 million administration costs would be cut. Loss of earnings compensation will be available only to those who cannot work again or only in a limited capacity, rather than, as it is at present, to anyone who is off work for longer than 28 weeks. Where is the incentive for those with serious injuries to get back to work? It beggars belief.
Some 90% of currently eligible innocent victims of crime will see their entitlement cut totally or in part. That is something in the order 36,000 victims of crime who will see their entitlement cut or wiped out. Furthermore, under the new scheme, victims will be asked to pay up to £50 up front to obtain their initial medical evidence. Making victims pay that amount when they may be off work or still emotionally or mentally scarred from their attack could well prevent genuinely injured victims from bringing a claim.
Between April 2011 and April 2012, there were 6,450 admissions to hospital as a direct result of a dog attack, an increase of 5.2% on the previous year. Is anyone on the Committee happy that those individuals—one in six of whom is a child under 10—will no longer be able to claim criminal injuries compensation, no matter how severe their injury? Do not just take my word for it or that of various experts. A judge of the Criminal Injuries Compensation Tribunal, who understandably does not want to be named, has given his or her views on the proposed scheme. The judge’s comments include the following:
“The wholesale removal of awards for current tariff levels one to five and significant reduction in awards for injury descriptions at the lower to mid-end of injury descriptions is perverse and grossly unfair to victims of crimes of violence.”
The Minister and the Secretary of State have tried to justify what I believe amounts to skulduggery, bringing an unchanged scheme back to Committee and offering a few crumbs, a few warm words, so that this statutory instrument will be approved.
Mrs Grant: I am a little surprised and disappointed. I thought the hon. Gentleman might have had some welcome words for the hardship fund that I announced. That would certainly help some of the poorest, most vulnerable and needy people in the country.
Robert Flello: I was coming to that in a few moments. The amazing hardship fund—details of which I look around for but do not see—was announced only a few days ago, if that. In fact, it was not even announced a few days ago. That announcement was that something would be said in this Committee that would address the matter. My maths is not brilliant at this time of the morning but 10 September was not a couple of days ago. I will go on to such detail as there is about the hardship fund, but the fund itself beggars belief.
Robert Flello: I will come to it. The Minister said that an exceptional provision will come in as a hardship fund. That concession, worth £500,000, is being taken back from the savings of £50 million to create a discretionary fund for use with lower-tier injuries, where there may have been a disproportionate impact. That would be, as described by the Minister, where somebody on low pay is temporarily unable to work, is in bands one to five, and has been referred by certain organisations such as Victim Support. Details will be tabled at a future date.
That discretionary fund is not in the legislation or the statutory instrument. There are no guarantees that it will not be cancelled next year, once the SI has been approved. The concession is worth 1% of the cuts that are being proposed. Government Members should ask themselves how much extra will be spent trying to administer the proposals. How much, on top of the £20 million administration costs already noted, will be spent to administer this £500,000 pot? Will that generate the same value for money that the current scheme actually provides in a stable and sustainable way?
Also, Members should ask themselves how the concession will be scrutinised, to ensure that it is doing what the Minister promises. We do not know, because there are no details. How many of those who are currently receiving payments as a fund of last resort will be left with bills to pay, as a result of them being victims of a crime where it is judged that the concession will not apply? I am afraid, Minister, that this concession is petty and pointless.
When it comes to the Minister’s comments about providing better support instead of financial support, are we to believe this nonsense too? The Ministry of Justice has only just beefed up the team that is looking at what victim support will be delegated to police and crime commissioners. So they, and therefore we, have no idea what will be kept centrally by Government and what will go down to a local level.
Of course the nonsense grows stronger when we look at the fact that the funding for victim support commissioned by the PCCs will not be ring-fenced. So the Government have no idea what they will provide versus what will be available locally. The Government do not know if the local PCC will spend the money they get on victims or if they will spend it on making up the shortfall on front-line policing. Indeed, we do not know how any money will be spent on victims, as the Government have clearly stated in the House that it is for PCCs to decide; that money should not be controlled by Ministers. I am afraid that it is an utter sham.
We agree that all injured victims of crime need support services to be available. Any attack is very traumatic for an innocent victim. Many victims need counselling to help them to come to terms with the assault, and to ensure that fear of a similar experience does not permanently blight their lives. However, the amount to be received from the victim surcharge is far from certain. We are told that it will be up to £50 million, which is interesting. Is not that the amount that is being cut from the scheme? And yet the Prisoners’ Earnings Act 2011 has raised just over £800,000 in the first year. It is difficult to see how a significant sum could be raised when offenders already owe so much in court fines that have never been collected.
It also appears from the Secretary of State’s letter—the one that I referred to earlier and that went only to Government Members despite the fact that it was sent in an official capacity—that support services will no longer be available to victims of less serious crimes, such as those who currently receive compensation in bands one to five. It says on page 1, paragraph 5 of the letter, which unfortunately managed to find its way into my hands, that the reforms to support services for victims will see
So priority is being given, but the way that the letter reads—we can only go on what is in this mysterious, amazing letter—it appears that support, rather than being given to all victims, will be prioritised.
I welcome the retention of payments for sexual offences and for patterns of physical abuse, but everyone on this Committee should be very concerned about the tightening of the condition on reporting a crime to police as soon as is reasonably practical. At present, the scheme allows a report to be made to another authority, such as social services or a hospital, but that option has been deleted, which will mean more victims will be denied a claim. The tighter condition on co-operating in bringing an assailant to justice will also exclude victims who are scared and/or particularly vulnerable. Victim Support says in its consultation response:
“There are circumstances where victims of crime are either too traumatised or feel too intimidated by the offender to take part in the justice process, and we do not believe that victims should be discriminated against on this basis.”
This change will mean that many vulnerable victims, especially those who have suffered sexual offences or physical abuse, will be unable to claim any compensation, no matter how serious their injuries or the crimes against them.
I need, quite properly, to speak about the other SI that we are considering today. Because of the abomination that is the new criminal injuries scheme, the overseas
I am scandalised that the Minister wishes to bring the new criminal injuries scheme back to Committee without amendment. This scheme targets innocent victims of crime who have no other way of being compensated for the injury, trauma and financial hardship they have suffered through no fault or wish of their own. The Government’s Parliamentary Private Secretaries and loyalists need to think carefully, before we vote, about whether, in good conscience, they can support it. Are those Committee members on the Government Benches with the right hon. Member for Wokingham (Mr Redwood)? He said:
“I have never been shy about saying that I would like us as a government to spend less overall, but I never once thought it had to be done by cutting something so sensitive or giving a worse deal to the disabled, the poor or the most vulnerable.”
“the last place I would look for savings would be benefits and payments to the vulnerable, injured and incapacitated—indeed, I would not look there at all. If anything, we should be more generous. I did not come into Parliament to see those things cut.”—[Official Report, First Delegated Legislation Committee, 10 September 2012; c.22.]
The right hon. Gentleman said that about exactly the same scheme that is before us today. Will Government Members agree with their colleague or will they be seduced by the non-starter concession that the Minister has finally introduced today? Will those on the Government Benches go along with this appalling scheme or stand up for the innocent victims of crime?
Even if the Committee votes to reject the scheme, the Government could still force it through, but Committee members will have sent a clear message to the Government that this is wrong, and I strongly suggest that they will have done their conscience good and their career no harm. [Interruption.] The Government Whip chuckles at my last point, but evidence shows that voting against their Government from time to time does not harm the career of a PPS.
I am afraid that this scheme is the legislative equivalent of seeing the Government take the wallet out of the back pocket of a victim of crime who is knocked to the ground. That is exactly how shameful this scheme is; it is adding financial insult to injury. I urge Committee members from all parties to reject this appalling scheme and force the Ministry of Justice to come back with a proper scheme that supports victims, not one that punishes them further.
Mr Andrew Smit h: In more than 25 years in this place, I have seen some pretty bad measures put before the House of Commons, but this is probably the most miserable, mean and ill-judged proposal that I have ever been called upon to express an opinion on and vote on. Like my hon. Friend the Member for Stoke-on-Trent South, I am shocked that the Government, having withdrawn the statutory instrument because they recognised that all parties in the House, and the general public, were concerned, have brought it back without changing the content of the measure. Instead, they have changed
As we have heard, we are talking about compensation being taken away altogether from nearly half of the victims presently eligible for it in tariff bands 1 to 5, which cover quite serious and permanent injuries, such as speech impairment, minor facial disfigurement, and so on. We are talking about 35% of victims who are even more seriously injured, often with permanent disability, seeing their compensation in tariff bands 6 to 12 severely reduced. We are talking about payments for loss of earnings being drastically cut, with only the level of statutory sick pay—£85 a week—paid rather than the victim’s average earnings. We are talking about compensation for loss of earnings being limited to those who can never work again, or only in very limited capacity. What is more, it will be denied to any with a broken work record in the previous three years. Government Members must see that that is penalising people who have been unemployed but have got themselves back into work, although they may have been injured in the course of their work. It runs directly contrary to all the rhetoric we hear from the Government about getting people off welfare and into work. It is penalising those who have been unemployed and are doing their best to help themselves and their families.
Those cuts and conditions on loss of earnings compensation will also apply to dependants of victims of murder or manslaughter, which will drastically reduce the payments they receive. We are talking about compensation that will be taken away from thousands of victims who have been viciously attacked, often in the course of their work, which is often for low wages. The Minister did not even have the courtesy to spell out the details of the hardship fund to the Committee—it is an outrage that the Government should take away a measure, bring it back and say, “Hey, we have got this scheme”, but when we ask, “Where are the details?”, they reply, “They will be announced in the future.” That is an absolute outrage and an affront to the victims of crime—the Minister and the Government ought to be ashamed. Those victims, having been degraded once by their assailant, will feel that they are being degraded again by this attack by the Government.
I am proud to have been a member for more than 30 years of the shop workers’ union, USDAW—the Union of Shop, Distributive and Allied Workers. I know just how vulnerable to attack many shop workers and other workers serving the public in postal, transport and the public services are. I recently met Frankie, a customer services adviser aged 28, who was attacked on a woodland path on his way to work in a large supermarket on the south side of Glasgow. Frankie suffered two stab wounds and was left with eight scars on his face, hands and forearms after one of his attackers held him down while the other slashed at him with a sharp object before robbing him. His assailants were never identified, he has been told by the police that if they are caught they will be charged with attempted murder. Frankie was off work for almost a year, and he told us that the trauma of the incident, understandably, turned his life upside
“There was more worry on the financial side than anywhere else, because of having to pay for my house and children. General household bills were more of an issue, but it made life a wee bit easier knowing that I was going to get some sort of compensation.”
Now, the £2,500—not adequate in itself, I argue—he received in compensation after that awful attack and trauma would be reduced to £1,000 under the Government’s proposals. That amount, Frankie says, he fears would have left him homeless. I do not believe that Government Members, in their heart of hearts, can think it is right to deny £1,500 to the likes of Frankie.
The Government have argued, and we heard more of it this morning, that the Compensation Scheme is financially unsustainable but, as my hon. Friend pointed out, that is not borne out by their own figures or by the impact statements. The cost of the tariff scheme to the Ministry of Justice has averaged £192 million over the past four years, which is remarkably stable and within the current budget of £200 million. The Minister referred to higher costs than that, but those were because the cost of criminal injuries compensation as a whole was higher in 2011-12 owing to payments by the Government totalling £237 million on 78 cases that arose before the tariff scheme was introduced in 1996. The majority of those cases involved children, so a final assessment of their ongoing need could not be concluded until they reached adulthood. Total liabilities under the scheme are inflated by the cost of historic cases, including £148 million for 73 pre-1996 cases yet to be settled.
It does not say that in the absence of reform the cost will rise or get out of control, it says that that level of spending will continue. That is the Government’s own impact assessment. The problem is that the Government are choosing to cut the scheme’s budget, and I appeal again to Government Members to accept that in making the victims of crime pay the price of those cuts, they have picked the wrong target.
We all know that in the present fiscal circumstances difficult choices must be made. I understand the pressure of party loyalty on Government Members, but surely we must put the interests of vulnerable members of the public first. If they consulted their constituents and their party associations, I am sure they would be told not to cut criminal injuries compensation. Above all, if they listen to the victims of crime, they will reject this measure today.
Katy Clark: On a point of order, Mr Dobbin. I am delighted to see you in the Chair today. I arrived in the Committee slightly late this morning although I was here early, because when I asked for a copy of the impact assessment, it was not available. I went to the Vote Office and the Library to ask for a copy, but neither could provide one, although I understand from the Clerk that it is available on the Ministry of Justice website. Could the Minister be asked to provide a copy to every member of the Committee?
Julie Elliott (Sunderland Central) (Lab): It is a pleasure to serve under your chairmanship, Mr Dobbin. I will be brief and specific to the areas affected by the criminal injuries Compensation Scheme and loss of earnings, but I want first to say how moving the contribution of my right hon. Friend the Member for Oxford East was. Having heard the impact that the changes will have on real people’s lives, the Government should take note.
The loss of earning provision is being changed dramatically; it is not just being tinkered with. What the Government are trying to do is unjust and wrong. First, an applicant must be able to prove that they had been in continuous work for at least three years prior to the attack. That is not easy in the current economic climate, certainly in a constituency such as mine where temporary contracts are the norm, and there is little stability in the world of work. We are not living in times when people work permanently for the same employer. That is the first hurdle to be overcome.
Secondly, people will not be able to claim loss of earnings compensation if they are able to do any work in future. They may have been doing a job that pays average earnings—not a huge amount of money—and if they do any work, which may be at the minimum wage, for a few hours a week, they will not be entitled to any money.
Finally, the hardest thing to bear in the proposals is the amount of money that loss of earnings will be based on. It will be based on statutory sick pay, which at the moment is £85.85 per week. Minimum wage earnings per week are £229.03. A nurse earns £586 per week, a teacher £661, a welder £442, and average earnings are £498. How a scheme that was based on one and a half times those amounts can find £85.85 a reasonable amount of money to compensate for loss of earnings defies logic. That is immoral and unjust, and as it comes from the Ministry of Justice, it is almost laughable.
In conclusion—we are pressed for time—I am concerned about the change that the Government are proposing today. It will make suffering worse, and it is wrong. The Government have a moral obligation to take it away, look at it and think again.
Mr Pat McFadden (Wolverhampton South East) (Lab): Thank you for your chairmanship today, Mr Dobbin. As my hon. Friend the Member for Stoke-on-Trent South said, this legislation began its life with cross-party support under the last Government, and has now been taken forward. It is of course absolutely right that we have a scheme that compensates victims of overseas terrorism.
I was not a member of the Committee that considered the original order, but the Minister did the right thing by appreciating the strength of opposition to it and withdrawing it. Nonetheless, it more than puzzles me that the order has been brought back unamended, and simply with a different composition on the Government Benches in order to try and ram it through.
Robert Flello: My hon. Friend talked about ramming the scheme through. Is he aware that the Criminal Injuries Compensation Authority has been told to be ready to implement the scheme on Monday 5 November, namely next Monday?
I want to make a few points in relation to victims of attacks by dogs, especially those who incur such injuries as a result of doing their job. Perhaps most obviously, we think about postal workers in this context, but it could also be a health visitor, a plumber, or an electrician; it could be anyone who has to visit people’s homes as a result of their job. Under the current scheme, workers who are attacked have some recourse to compensation. It is usually not large, but it is something. The Government say they are withdrawing this provision because it is about criminal intent. However, that leaves workers with no recourse, no matter how serious their injuries might be. Surely the Minister knows how difficult—and in many cases impossible—it is to prove criminal intent in such cases. That does not change one iota the severity of the injury incurred by the victim, or the damage to them and their lives.
As my hon. Friend the Member for North Ayrshire and Arran said, the proposed change might be more justifiable were the Minister proposing some serious action as an alternative, but she is not. There is no compulsory insurance scheme for dog owners. I ask the Minister to tell us in her summing up what proportion of dog owners have insurance that would cover victims in this kind of situation. I would be interested to know what lies on the other side of the equation in terms of the recourse that people have. I suspect that few dog owners have insurance that would cover such injuries. I also suspect that those who are in possession of the most vicious and aggressive dogs are the least likely to take out such insurance.
The Minister mentioned the courts, but the courts are a slow and unwieldy mechanism. If they make an order at all, they will take into account the circumstances of the dog owner and not always the severity of the injury. The courts are not an adequate alternative route either. That leaves workers who are bitten by dogs during the course of their employment with nowhere to go for compensation. Such injuries are not trivial and can often be very serious.
We are told that there are 12 attacks on postal workers every day, which is some 5,000 a year, and it would be more if we add other workers. Such injuries include lost fingers, puncture wounds, nerve and ligament damage and other serious and lasting injuries. Some attacks result in prolonged absence from work, lasting physical pain and lasting psychological damage. From our constituency work, we all know that the number of vicious and aggressive dogs is on the increase. We see them in the street, wielded by their owners like weapons. We all know that the current laws are failing to control the problem. The proposed changes take away an important avenue—for many people, it is the only one—for redress for those injured by dogs in the course of their jobs.
Imagine the fear of a postman or postwoman trying to do their job and facing an attack from a pit bull, Rottweiler or other similar breed. Perhaps more than
Imagine the pain and anguish if, after an attack, a worker is left injured and afraid, but the Minister’s Government has withdrawn the only means of redress in terms of compensation. As my right hon. Friend the Member for Oxford East said, it is not as though the costs of the scheme have been running out of control. They have been pretty constant for the past five years, yet these mean-spirited changes will leave key groups of workers with no redress. During my time in Government, I did not always see eye to eye with the Communication Workers Union, which represents postal workers, especially on reform of Royal Mail, but I do not see why any worker should be subject to dog attacks as a result of their job and then have their compensation rights withdrawn by the Government.
The Minister was right to withdraw the order the first time around, but she is wrong to bring it back unaltered. The Opposition hoped that that would mean some changes. There have been none. I hope that she will withdraw the order and reconsider. Is this really how the Government propose to save money? She talked about the level of savings. In any decision to make savings, there is a balance between the money saved and the effect of the saving. I think that that balance is profoundly wrong in this situation.
The Tory party prided itself on being the party of law and order, but here it is leaving victims of criminal acts without compensation, or with severely reduced compensation. I ask the Minister to think whether the savings are worth that in human or political terms. The Liberal Democrats, too, will have to explain their position on the order. If it is rammed through, the effects will be remembered for a long time to come.
Tim Farron (Westmorland and Lonsdale) (LD): It is a pleasure to serve under your chairmanship, Mr Dobbin. I will take only a minute of the Committee’s time. Obviously, I welcome the element of the proposals relating to the inauguration of the overseas terrorism compensation scheme, and I praise the previous Government for beginning that work. Many of us feel that it is fair to redistribute money within the pot to the victims of crime with the most serious injuries, and who have suffered the most incapacitating injuries with the longest lasting impact. However, I have some concerns to raise briefly.
There is a pleasing symmetry to matching the removal of £50 million in taxpayer contributions with the provision of £50 million by offenders. However, as Opposition Members have said, there is a concern. This year, we have raised less than £1 million through the scheme. Many of us fear that although the reduction of £50 million from the taxpayer has been definite, matching it with £50 million from offenders is only an aim, and we therefore consider the scheme potentially underfunded.
Without going into the detail of individual injuries mentioned by Members, the exclusion of injuries in bands 1 to 5 leaves many of us feeling uncomfortable. I am sure that that is why the first bite at the legislation was not successful. I was not a member of that Committee, but had I been, I would have raised concerns that some of the categories of injury included in bands 1 to 5 have not been recategorised so that people who suffer such injuries can receive some form of compensation. Will the Minister answer those concerns?
Finally, the hon. Member for North Ayrshire and Arran has already mentioned the impact assessment. It is difficult for us to make a judgment today without any information on the likely outcomes, so I ask the Minister to reflect on that and to consider seriously whether the injuries in bands 1 to 5 might be recategorised and whether the impact assessment might be presented before a decision is made.
Teresa Pearce: It is a pleasure to serve under your chairmanship, Mr Dobbin. Rather than repeating what my hon. Friends have said, I will concentrate on a few questions. Under the proposed new scheme, victims of crime will be charged £50 to obtain initial medical evidence, which is likely to deter those on low incomes. Will the Minister explain the intention behind that charge? Is it intended to have a deterrent effect on claims or simply to save money?
I would like to mention the penalisation of workers in a flexible labour market. Some of the recent legislation on universal credit encourages a flexible labour market, but it appears that the scheme will penalise people with short-term contracts who do not have three years’ continuous employment. I have seen figures to suggest that that might exclude up to 10 million people, or a third of the work force. Will the Minister confirm that those figures are correct or give me the figures that she has at her disposal about how many people will be excluded from the scheme?
Two of my hon. Friends have mentioned that under the new regime, victims will have to report abuse to the police rather than to social services or to a hospital. Victims of sexual and domestic abuse are often traumatised and unable to report that abuse for a considerable amount of time. Given the current inquiries into Jimmy Savile, what message does the scheme send to the brave women who have come forward now, some of whom were so traumatised that they were unable to come forward until the perpetrator had died? What is the rationale for that change?
The way in which we treat victims of crime is a reflection on our society. The Minister’s letter of 17 October states that “prompt emotional and/or practical support is the right response from Government, rather than relatively small payments”, but surely both are equally important. Compensating a victim of crime gives them a sense that that crime has been officially recognised by the Government and by society, which is very important.
I ask my Liberal Democrat friends to consider the case of a young 33-year-old man called Simon, the manager of a convenience store. He disarmed an axe-wielding man during an attempted robbery at the store, defending other members of staff and his employer’s
I ask members of the Committee to consider really carefully before they vote on the scheme. Victims of violent crime deserve more than just words. The criminal injuries Compensation Scheme should be something that we are proud of—a humane response to the terrible experiences of victims of violent crime—and I believe that the Government’s reforms will greatly undermine that. I want to ask Government Members seriously to consider when they vote that if the scheme is adopted, the Government and those who voted for the scheme will be remembered for being tough on crime and tough on the victims of crime.
Katy Clark: It is a pleasure to have an opportunity to speak in the few minutes that we have left. I spoke on the previous occasion when the scheme was before a Committee. I was not a member of that Committee, and I think my reward from the Whips Office has been to be put on this one. I am delighted to be here, because I think the issue is incredibly important. It will have implications if it goes ahead in all our constituencies, for many of our constituents in many different situations. If these proposals go ahead we will all have people coming to our surgeries who will be extremely concerned that they are no longer eligible for compensation. Although I have not seen the impact assessment, I understand that 48% of people who currently get compensation will no longer get any compensation at all and more than 40% of those who will still get compensation will have that compensation severely reduced. So only about 8% or 9% of victims will continue to get the levels of compensation that they currently get on the tariff level. However, they will still get far less compensation for loss of earnings and as we have heard that will be a significant issue for many people.
I have a number of concerns, but one that the Minister needs to consider very carefully is about the reporting requirements. There will be many people who are victims of sexual abuse, particularly historical sexual abuse, but probably victims in other situations, who have not reported crimes and who most Members of Parliament would feel should receive compensation. But the wording of the scheme means that they will no longer get that. Does the Minister accept that under the new wording of the scheme there will be far less discretion and that many victims, particularly victims of historical sexual abuse, will no longer get compensation?
Many of the people who suffer as a result of dog attacks are children. I understand that the majority of attacks are on children. I do not think that we have thought through clearly the implications of the change on them. If the Government go ahead with proposals of
The Minister has spoken about the financial savings, but as my right hon. Friend the Member for Oxford East clearly stated, the budget for the Criminal Injuries Compensation Authority has remained stable at just under £200 million. The extra costs in recent years have very much been associated with the deliberate task that the criminal injuries compensation system has undertaken to conclude the old Criminal Injuries Compensation Board cases. I understand that £400 million was put in the accounts for that, although I am told by somebody involved in the system that only about £130 million or £140 million of that has so far been spent and only about 60 or 70 cases are left in the system. But many of those cases involve young children because the practice of the criminal injury compensation system was to wait to see if there were prospects of recovery or how a child responds. If we exclude those historical matters, the finances of the Criminal Injuries Compensation Authority have clearly been extremely stable. I do not believe a political case has been made today as to why this should be an area targeted for cuts.
The other issue I want to mention, because it has not been dealt with in any of the other contributions, is the £50 that will now be charged for the individual to get access to their own medical records. Many individuals will find that £50 a problem. A greater problem will also be the fact that the applicants have to get their medical records themselves. Anybody who has been involved in any of these matters at any time will know that at the moment the Criminal Injuries Compensation Authority has to get the medical records. That often is not as straightforward as it sounds. I suspect that there will be a whole range of problems associated with that provision and the Minister needs to look at it again.
As I said, the Criminal Injuries Compensation Authority is based in Glasgow near my constituency, and I would be interested to hear what the Minister has to say about the job losses that will result from these cuts, given that far fewer people will be able to apply for criminal injury compensation. I presume that there will be knock-on effects and that I may well have constituents contacting me about that issue.
One of the threads that runs through the whole of this new criminal injuries Compensation Scheme is the loss of discretion that will be available to those administering it. The view from lawyers who deal with these matters is that the wording of the scheme is likely to lead to more appeals and that that will lead to massive administrative costs. Will the Minister fully outline what work has been done to quantify the cost to the taxpayer of that? I believe that if the Minister goes ahead with these changes, she will regret them in due course. As more and more people become aware of how it will affect some of the most vulnerable in society, they will take the view that this cut is completely unacceptable.
Mrs Grant: I am grateful to hon. Members who have taken part in this debate. I have listened carefully to all the points raised, as I did last time. The reforms that we have discussed today will put the criminal injuries Compensation Scheme on a more secure footing and will achieve our aim of focusing compensation on those most seriously injured as a direct result of deliberate violent crime, as well as reducing future pressure on the public purse. The establishment of the hardship fund will go some way towards supporting those who need some immediate financial help as a result of being a victim of crime and no longer being eligible under the scheme. As I made clear in my opening speech, our aim is that the overall funding for victims will remain the same. The saving to the taxpayer from CICS reforms will be matched by a similar sum raised from offenders, which will be put into victim services.
Our reforms aim to ensure that offenders contribute much more to the costs of victim services and will go some way to redressing the current imbalance between the burden on the taxpayer and the burden on offenders. I do not have time to comment in detail on every single issue that has been raised by hon. Members today, but I want to say something in particular by way of response on the issues of dogs, the tariff, hardship and the impact assessment.
The right hon. Member for Wolverhampton South East and others had concerns about dog attacks, and I hope that I have been able to explain the rationale behind the reforms and to provide some reassurance of the Government’s intention to take a much firmer line on irresponsible dog ownership.
The right hon. Member for Oxford East and others spoke forcefully about the reforms to the tariff bands and, again, I hope that the establishment of the hardship fund will be welcomed and that I have made clear that if an injury is sufficiently serious and the applicant will not make a complete recovery, an award of compensation could still be claimed.
Mr McFadden: The Minister asked if Opposition Members were reassured by what she had said about dog attacks and the answer is no. I ask her again: does she know how many successful court actions have been brought by victims of dog attacks in any typical year? Does she know what proportion of dog owners have the insurance that would allow victims to make claims?
The shadow Minister raised issues about the hardship fund. I confirm that as it is a new scheme, it will be reviewed, and I will look at it carefully to ensure that it reaches the intended recipients. I will also publish shortly a written ministerial statement with full details. The administrative costs will be absorbed by the CICA. For the avoidance of doubt, I am informed that the CICA was not told to implement the scheme by 5 November.
Finally, the impact assessment—an issue raised by the hon. Member for North Ayrshire and Arran—was published when the draft scheme was laid in July. However, I am of course happy to arrange for a copy to be sent to each and every member of this Committee.
Our plans for state-funded compensation go hand in hand with the money that we will plough into victim services. The draft scheme will continue the paying of compensation to those most seriously injured and affected by violent and sexual crime. It strikes the right balance between our recognition of the impact of these crimes on victims and the financial realities that we face today.
Tim Farron: I can see that the Minister is coming to the end of her speech and I wanted to intervene before she finished. Can she confirm that this measure will still come before the House next week and, should the House choose to divide on it, the earliest that that could happen would be next Wednesday, probably through a deferred Division? If that is the case, will she have time to ensure that the impact assessment is distributed before then and to look again at issues to do with injuries categorised under bands 1 to 5?
Mrs Grant: I am told that I can say yes on all those issues, certainly in relation to timing, but for the avoidance of doubt, I will write to the hon. Gentleman, setting out my exact response on each of the issues that he has raised.
Katy Clark: On a point of order, Mr Dobbin. This is subsequent to the point that has just been made. I intended, later in the Minister’s speech, to ask for clarification on how a Member would initiate the process of getting a vote on the Floor of the House, so that all hon. Members have the opportunity to be involved in the decision. I ask for clarification on that from the Chair.
Mr Smith: Further to that point of order, Mr Dobbin. May I ask, through you, that a copy of the letter from the Minister to the hon. Member for Westmorland and Lonsdale, who asked about the schedule of timing, also be sent to every other member of this Committee?
Katy Clark: On a point of order, Mr Dobbin. I am very grateful for your indulgence. I attended a previous delegated legislation Committee—again, I was not a member of the Committee—on the timetable for submitting unfair dismissal claims. The Government changed the deadline so that we went from a one-year qualifying period to two years. On that occasion, the delegated legislation was voted through by the Committee, but there was a mechanism by which individual Members of Parliament were able to get a vote on the Floor of the House. I find it difficult to believe that it was the Government who wanted that vote and I would be grateful for clarification on that, because I understand that over many years there have been different procedures and I want to ensure that I take the appropriate steps in relation to this matter.
Draft criminal injuries compensation scheme 2012