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Criminal Injuries Compensation: Time for Change - Neil Sugarman, Neil Sugarman, President of APIL

10/04/17. The first ever scheme to compensate victims of violent crime in Great Britain was launched in 1964.

It was an ex gratia scheme provided by the government of the day and followed ten years of political lobbying by justice campaigners such as Margaret Fry, who was determined to ensure that innocent victims were properly compensated.

The ex gratia schemes were not perfect. There was no provision for the payment of interest on awards, nor did they make provision for the payment of the cost of legal representation.

Nevertheless, the basis of compensation was common law damages. Consequently, sums running to several million pounds could be awarded in thankfully rare cases such as those involving brain damage. In particular, cases of catastrophic damage through shaking of babies resulted in awards that would cater for lifelong needs without reliance on the state, although there were provisions allowing for the offset of state benefits against heads of loss so as to avoid double recovery.

Everything changed in 1995 with the passing of the Criminal Injuries Compensation Act. There was something of a “false start” when the government was judicially reviewed in an earlier attempt to introduce a non- statutory, tariff based scheme, but it eventually achieved its objective, resulting in the introduction of the first ever tariff based scheme in 1996.

That provided for the possibility of three broad heads of loss. First, a sum awarded according to a tariff or list of injuries. There were some discretions available to the awarding Criminal Injuries Compensation Authority, the successor body to the old Criminal Injuries Compensation Board, enabling a recognition of the degree of severity of injury. However, the sums were fixed.

There was the possibility of an award for loss of earnings or earning capacity with a qualifying period of twenty eight weeks and then a category for Special Expenses, again with a twenty eight week qualifying period, covering broadly care and supervision, equipment, adaptations to accommodation and limited recognition of costs associated with mental health issues. Successor schemes have altered the definitions surrounding individual aspects of Special Expenses and until 2012 it was possible to recover the cost of private medical treatment.

The single most troubling factor was that the 1996 Scheme introduced a “cap” or maximum award of £500,000 for all heads of loss, however they combined and the cap has remained in place at that figure ever since, now twenty one years later.

There has been no uprating, even so as to take account of inflation. That would have taken the figure nearer to £860,000 .The Armed Forces Compensation Scheme, soon likely to be revised following government consultation pays a maximum of £570,000.

In 2012 the Scheme was cut dramatically, removing five lower tariff bands of injury entirely from entitlement to compensation and reducing the next six bands. Under the 1995 Act, the Scheme is laid by Statutory Instrument before a Delegated Legislation Committee. When first placed before the Committee in September 2012 it was withdrawn in the face of clear opposition with the then Parliamentary Under Secretary of State, Helen Grant stating that she would pause for thought.

Exactly the same Scheme was reintroduced to an almost entirely differently constituted committee in November 2012 and passed. Announcing the establishment of a Hardship Fund of £500,000 to provide relief for lower paid workers who no longer qualified for an award Ms Grant said “The government believes it right to focus criminal injuries compensation on victims of more serious crime and for victims with less serious injuries, prompt practical and emotional support is a more suitable response than relatively small amounts of compensation.” No such measures have been introduced.

The Hardship Fund has paid out less than £5000 since then. The cap of £500,000 remains in place by virtue of paragraph 31 of the 2012 Scheme.

Furthermore, there are severe restrictions that have been introduced by the 2012 Scheme. Qualification for an award for loss of earnings or earning capacity is restricted to those in paid work at the time of the incident and who have been in regular work for three years immediately before the incident, with limited exceptions. The weekly loss is limited to the equivalent of statutory sick pay, currently £88.45 per week, as is the weekly sum payable for lost dependency in fatal claims under paragraph 71.

The provisions relating to Special Expenses have also been designed to be more restrictive. In particular, the removal of an award for private medical expenses is devastating to an application involving severe injury, since this used to encompass a wide range of therapies.

These areas, combined with the remaining “cap” make it difficult to see quite how the Scheme is doing more for people with the most serious injuries.

Change is well overdue.

Neil Sugarman
Association of Personal Injury Lawyers

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