Tuesday, 5 November 2002
Dáil Eireann Debate
68. Mr. J. O'Keeffe asked the Tánaiste and Minister for Enterprise, Trade and Employment whether there are conflicting views on the merits or otherwise of establishing a personal injuries assessment board; and if further examination of such proposals, and objective assessment thereof, will be made before final decisions are taken. [20272/02]
Mr. Fahey: An Agreed Programme for Government contains a commitment to establish a personal injuries assessment board, PIAB. At the end of last month the Government mandated the setting up of the PIAB on an interim basis and legislation is being prepared to put the PIAB on a statutory footing.
The various views put forward recently have dealt with the need to reform the court system and court procedures. I have no problem accepting that such reforms are needed. The key reforms advocated have already been recommended in the report of the Motor Insurance Advisory Board, MIAB. I would see the establishment of the PIAB and the introduction of court reforms not as alternative approaches but as going hand-in-hand and being mutually re-enforcing.
Mr. J. O'Keeffe: Political correctness dictates that I declare my interest. I am a lawyer, although  I have no personal interest in whether these proposals go ahead. Speaking as a public representative I voice my concern that the Government proposals to establish a personal injuries assessment board involve a leap in the dark. The proposals should be independently assessed before a final decision is made.
Does the Minister of State agree that while the proposals are supposed to lead to a reduction in the cost of personal injuries claims some experts now predict that they will lead to an increase in the cost of compensation and, accordingly, an increase in insurance premia? This will involve an expensive additional layer to the compensation system.
Does the Minister of State accept that the Government proposals should be put before a committee for independent scrutiny? This committee should be an all-party Oireachtas committee and the heavyweights of the interim board, the Law Society of Ireland, The Bar Council and the Irish Insurance Federation, should be asked to appear before the committee to justify and defend their positions in relation to the proposals. In this way we would hear the objective view of an Oireachtas committee on these proposals, which may or may not be a good idea. The onus of proof is on those who propose the establishment of this board.
Mr. Fahey: I say, with no disrespect to Deputy O'Keeffe, that the time has come for lawyers to recognise that it is time to put an end to the rip-off in the insurance industry and I am confident this problem will be tackled in an aggressive way.
International experience points to the fact that a body such as the PIAB will have a significant and immediate effect on the cost of claims. As Deputy Hogan has said, the sooner it is put in place the better. That is the objective of the Minister and the Department.
Mr. J. O'Keeffe: I have made a few bob in my time from compensation claims. I do not accept in any way that they were a rip-off, but that is not the point. We are talking about an issue of genuine public interest. Is the Minister aware that the Government's own PIAB implementation group, chaired by Mr. Cunneen, said that the establishment of this board would add another more expensive layer to the compensation system? Does he accept that there is need for independent scrutiny? Does he agree that, for example, the abortion hearings before the all-party committee introduced an element of transparency and that the report was very valuable? Does he agree that if the proposals are to be useful, they should be able to stand up to independent scrutiny, and that  the scrutiny should be provided by Members of this House? I am not going for a “Yea” or “Nay” in respect of these proposals. All I am saying is that the case is not proved.
I have seen simple solutions, one being to abolish juries which was to lead to a reduction in insurance costs. The abolition of the two senior counsel rule was another which was to lead to a reduction in insurance costs according to the Insurance Federation, but what happened? They just kept going. The problem is that we may be going up the same cul de sac here. We have had talk of a 31% reduction in insurance premia, but that is not correct. There is supposed to be no reduction in compensation, so from where is one going to get a 31% reduction in premia?
I want to take up the comments raised by Deputy Jim O'Keeffe. I was very cautious when he started because I felt his call for what I originally thought was an independent assessment by the Bar Council and the Law Society was something straight out of the old television programme “Yes Minister”, in which it would have been killed with a thousand cuts of the pen by lawyers and barristers. The suggestion of an independent analysis, if Oireachtas Members can ever be independent, has merit. Will the Minister consider broadening the scope rather than just looking at the possibility of the PIAB as assessed here and take a radical look at alternative systems, such as the no-fault insurance system that operates in certain countries, including Australia and New Zealand? We should examine those as possible methods of dealing with this problem.
The second revised suggestion from the Deputy is very much supported by our party. I am interested to hear if the Minister will take it on and broaden it so our independent analysis looks at a number of wide options and not just those already on the table.
Mr. Hogan: I have no difficulty with his case. The Tánaiste and Minister for Enterprise, Trade and Employment is making this proposal and is  about to set up an interim board on the basis that there will be a reduction in the cost of litigation and that the process of dealing with smaller claims will be much smoother. That is the reason she has stated the PIAB is to be established. I see nothing wrong with the jury being still out, if one will pardon the pun, about its effectiveness. The reason Deputies O'Keeffe, Eamon Ryan and others are seeking to have this matter fully investigated is so there will be confidence in the system when it is established and so it will achieve the objective of ultimately reducing the cost of insurance to consumers.
Mr. Fahey: —board, the Motor Insurance Advisory Board, has made recommendations. It is quite clear in its recommendations. We now have an interim board of the PIAB, which is made up of independent people—
Mr. Fahey: They have come up with this recommendation which is now being implemented. There are many models from Sweden to Australia that show it is a very good system. We do not need more analysis and I suggest we allow this group to get on with the implementation process.
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