Previous Section Back to Table of Contents Lords Hansard Home Page

Lord Macaulay of Bragar moved Amendment No. 19:

Page 2, leave out line 28.

The noble Lord said: With the leave of the Committee, in moving Amendment No. 19 I shall deal also with Amendment No. 20 because they really run together. Amendment No. 19 is a probing amendment which raises a question in relation to the Secretary of State having the power to remove the "description" of an injury. The word "description" is not defined. Is it deemed that the Secretary of State in the future will be able to remove the injury itself—for instance, a "severely broken leg"—or the description of the injury; that is, the word "severely"? Are the words,

happily phrased within the context of the Bill? I put it no higher than that. This is a probing amendment to see what the word "description" means in the context of the Bill.

Amendment No. 20 is perhaps more important because it gives the Secretary of State the power either to increase or reduce the standard amount of compensation. If one's nose is broken in 1995, can the Secretary of State come along in 1996 and reduce the award one received in 1995? I am not sure what the phrase means, especially in relation to the cases we discussed earlier in regard to child abuse, sexual abuse and so forth, which I shall not repeat.

16 Oct 1995 : Column 642

A tariff has been drawn up. We have all seen it and the noble Baroness was kind enough to send me a copy some time ago. If the tariff scheme has been drawn up as representing the values for awards as of now, how can the Secretary of State reduce the value of an award, bearing in mind that we live in a time of inflation, even with the Government's best expectations? It may be that in three years' time they hope to bring inflation down to nothing, but I would have thought that that was a pious hope.

Assuming that inflation runs at 1.5 per cent. per annum, how can an award be reduced for someone who received a broken nose in 1995, whose claim is settled in 1997, because the Secretary of State says that it is worth less than it was in 1995? It is perhaps a conundrum. I leave it with the noble Baroness and I am sure that all those involved will be interested to hear her reply. I beg to move.

Lord Carlisle of Bucklow: Perhaps I may take this opportunity to make one point to my noble friend the Minister. With respect to my noble colleague on the board, the noble Lord, Lord Macaulay of Bragar, I do not agree with his intention to remove the words "or reducing" in Amendment No. 20. However, I ask the Minister in all seriousness what thought has been given to the views expressed by the board in relation to some of the figures in the tariff.

I am not trying to be cheeseparing; I am concerned generally about the overall cost of the scheme. When the original tariff was produced, it was not intended by the Government, sadly, that any loss of wages or future care should be taken into account. As a result, as we know if we look at the top end of the tariff, figures of £250,000 were put in as general damages for quadriplegia or tetraplegia and £175,000 for paraplegia. We felt it our duty to point out to the Home Office that those figures are way above those accepted by the courts as appropriate for general damages for tragic accidents of that kind.

As the Minister knows, as well as ignoramuses like myself and the noble Lord, Lord Macaulay, the board also consists of several practising personal injury senior barristers and solicitors. Their assessment was that the going award although that is perhaps a cheap way of putting it and I shall substitute the phrase, the normal award, for tetraplegia or quadriplegia for general damages in the High Court is £125,000 and for paraplegia around £100,000.

I am concerned, and those who practise particularly in the personal injuries field are concerned, that the Government are to publish a tariff with figures apparently double the size for the general damages aspects only of tetraplegia, paraplegia and these other very serious injuries. What thought have they given to the effect of the inflation on damages in the civil courts and to the effect on insurance companies generally? It was clearly right when there was not an intention to pay loss of wages, future earning capacity or loss of care—I totally agree with their intention not to pay—to put in figures above the normal figure for general damages. But once they had decided and conceded on the issue of paying for loss of earnings and future care I do question—not on behalf of the taxpayer but on behalf, I

16 Oct 1995 : Column 643

hope, of the responsible view from the legal profession—whether it is right to leave figures in the tariff which roughly are double the amount being paid by the civil courts at the moment without any apparent consideration of the effect this may have on inflation. I raised this matter under the question of the bereavement award under fatal accidents and I think it only right to raise it again now.

Baroness Blatch: Perhaps I may take that point first. My noble friend will understand if I do not give him a specific answer at this moment as we have not yet determined the tariff that will be put before both Houses as a final document. All the comments that have come in and all the consultation is still being considered. The point made by my noble friend is part of that consultation and we shall consider it.

The noble Lord, Lord Macaulay, asked what will happen to someone who makes a claim in 1995 which is dealt with in 1995 or 1996 when the new scheme is in place. It will be dealt with under the rules applying when the applicant applied. I have referred to one change that will be made. There will be an amendment to the present scheme in order to allow for structured settlements. That is intended to follow Royal Assent.

The power provides for the Secretary of State to revalue the standard amount of compensation payable in respect of a particular description of injury. It is also the power under which all or part of the tariff would be revalued. Increases or reductions in tariff amounts, or removal of injury descriptions from the tariff, could be required for sound, practical reasons. For example, it is possible that a number of broadly similar injury descriptions might need to be amended under Clause 2 (6)(a) or (d) of the Bill if experience showed that the tariff could better describe injuries of the relevant type. It might be necessary to add a new, more serious injury description, while reserving an existing one for less serious injuries for which a lower amount was now appropriate. Or it might be better to describe an injury in a new way, which might make the former injury description redundant. Leaving the old description in the tariff in such circumstances would create unnecessary confusion.

All the reasons I have just given are also the reasons why a scheme under the affirmative resolution procedure is so necessary, to allow for making sensible changes to the scheme which will arise from the operation of the scheme. Perhaps I may also remind the noble Lord, Lord Macaulay—this is probably his underlying concern—that the Secretary of State is not free to make any change to the tariff. Under the arrangements I have spelt out today, any changes to the tariff will require parliamentary approval by the affirmative resolution procedure and/or the negative resolution procedure. Thus, if Parliament is not happy with the changes the Secretary of State wishes to make to the tariff under this clause—in this instance, if it does not agree that injury descriptions should be removed or a lower tariff value substituted—Parliament can simply refuse approval for the proposed changes. That is the safeguard in the Bill. To go back to what the noble Lord,

16 Oct 1995 : Column 644

Lord Macaulay, first said, no Home Secretary is in a position simply to change anything to do with the scheme or the tariff within the scheme.

8.45 p.m.

Lord Macaulay of Bragar: I am obliged to the noble Baroness for her reply. One of the difficulties with the Bill, which we have had to consider at fairly short notice, is in its operation. Where is responsibility to lie? There is a theme throughout the Bill with regard to the managers, office managers and so on that none of them will be deemed to be acting on behalf of the Secretary of State. We shall perhaps come to that at a later stage, if not during Committee then certainly on Report, and ask where responsibility lies for the administration of the Bill. I am sure that what the Minister said will be noted with interest by those concerned with these matters. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 20 not moved.]

Lord Macaulay of Bragar had given notice of his intention to move Amendment No. 21:

Page 2, leave out line 33 and insert ("Provision shall be made for the Scheme to").

The noble Lord said: This amendment has been grouped with Amendments Nos. 35 and 51. For the convenience of the Committee perhaps I may say that I do not intend to deal with Amendments Nos. 21 or 35 at this time. It may be more appropriate to leave Amendment No. 51 until we reach it in the Marshalled List. I understand that that is acceptable practice.

[Amendment No. 21 not moved.]

Lord McIntosh of Haringey moved Amendment No. 22:

Page 2, line 33, leave out from ("Scheme") to end of line 35 and insert ("shall—
(a) not provide for any maximum amount of compensation;").

The noble Lord said: This amendment may appear to drive a coach and horses through government spending constraints but it really does not. The overall maximum provided in the tariff for individual awards is £500,000, which I acknowledge straight away is an improvement on the £250,000 in the tariff which was found to be illegal. In moving an amendment which removes that cap on total compensation of £500,000 I am not opening the floodgates of public expenditure. In 1993-94 there were only seven cases exceeding £500,000, the total excess being less than £1.38 million. It does not seem sensible to have this quite arbitrary cap.

Perhaps I may give two examples of the way in which larger amounts can be built up. I hope that the Committee will understand that the strictures which the noble Lord, Lord Carlisle, placed on some what he called excessive awards for quadriplegia and paraplegia do not really apply in the cases that will arise under the terms of this amendment. I have an example of a case of paraplegia where the general damages were £90,000. It concerns a man aged 33 at the date of the assault and 39 at the date of the hearing. He was stabbed in the back. He has complete paraplegia with all the difficulties associated with that—frequent episodes of severe pain, recurrent urinary tract infections and

16 Oct 1995 : Column 645

pressure sores. He needs permanent live-in care which had been provided by his wife and would continue to be provided by her in the future.

The total award of £785,000 was made up as follows: £90,000 for general damages—for pain, suffering and loss of amenity; £45,000 for loss of past earnings; £62,000 for loss of future earnings; £39,000 for future replacement of equipment; £22,000 for equipment already purchased or needed; £72,000 for past care; and £242,000 for future care. This is where the cost really starts to add up.

There are various other items for medical expenses. There is the future cost of transport at £39,000; accommodation at £60,000; future household expenditure, £75,000, and so on. It is a total of £784,000. One can very well see how, with the special expensive provisions which are made in the scheme and the tariff, one can get up to that figure and not be unduly generous.

A second example concerns a woman aged 19 at the date of the assault. She was attacked and suffered a fractured skull, a fractured cervical spine and fractured ribs. She also suffered severe head injuries. The severe head injuries caused severe memory impairment and concentration and organisational difficulties; in effect, severe brain damage. She had an interim award of £100,000, but she was awarded in the end £65,000 damages for injury, £7,500 for past loss of earnings, £60,000 for past care, £84,000 for future loss of earnings, £522,000 for future care (which is a multiplier of 15.5) and court and protection costs of £32,000. That is a total of £800,000. Again, one can see how that kind of amount builds up without any individual item being excessively generous. For the sake of what is probably less than £2 million in total, can the Government not give up this arbitrary £500,000 maximum? I beg to move.

Next Section Back to Table of Contents Lords Hansard Home Page