Bill for victims’ claims could cost State €828m

THE final bill to settle claims taken by child victims of institutional abuse could rise to a staggering €828 million, the Comptroller and Auditor General warned yesterday.

An estimate based on a survey of solicitors representing former residents of industrial schools and orphanages reveals that fewer than half of all victims’ claims have been lodged with a redress board.

The survey was carried out by a C&AG team and suggests the total bill, including legal costs, could be €200m more than the Residential Institutions Redress Board estimated last month.

The board, in 18 months to June this year has received 3,763 valid applications and made 1,277 offers. The total amount offered was €98.8m, an average of €77,000 plus €16,000 in legal costs. Just six cases were ruled invalid.

Total awards and medical and legal expenses paid to the end of June amounted to €86.95m, with the congregations paying €31m and the State €56m.

Under a controversial 2002 agreement with the Government, 18 religious congregations agreed to hand over to the state €128m in cash and property. At the time, the Government estimated less than 2,000 people would make claims but that could rise to 8,900, according to the C&AG John Purcell.

While Mr Purcell cautioned that “there are still uncertainties attached” to any final estimate, his office presented figures on three different bases:

The solicitors’ survey

FOI requests

The claim rate to date

The survey estimates that, as of May 31 this year, nearly 5,000 cases remained on file in solicitors’ offices and have not yet been lodged with the board. Further claims may yet be received by solicitors before the closing date for applications early next year.

With 3,600 claims already with the board, it is estimated the total number of cases will be 8,900. These would bring a total bill of €828m, of which €140m will be paid in legal fees.

Many of the claims followed FOI requests for information. Based on requests and the rate of follow ups, the C&AG estimates that the total liability will be €809m. An estimate based simply on the claim rate to date suggests the total bill will be around €700m.

The redress board, however, believes the final bill will be between €605m and €650m.

Each 5% change in award levels would call for an adjustment of around €30m-€40m, the CAG said.

“It is quite possible that movements may be countervailing since initial indications are that cost trends following taxation may create upward cost pressure,” he added.

Of the 27 properties offered to the State by the congregations, 26 have been accepted at a total value exceeding the €36m agreed.