Abuse compensation could cost State €1.35bn

THE final cost to the State of compensating institutional abuse victims through the Redress Board could reach €1.35 billion - 10 times the amount provided by religious institutions.

The estimate was provided to the Oireachtas Public Accounts Committee (PAC) yesterday by the Comptroller and Auditor General (C&AG) and the Department of Education.

C&AG John Purcell said it was impossible to provide an accurate prediction of what the final cost to the exchequer would be.

“What is clear is that the original and the revised estimates on the part of the Redress Board and the Department were severely undercooked.

“It looks as if we are looking at a minimum of a billion and a maximum ... of €1.35bn,” he said.

Those figures are based on the fact that as of the applications deadline of December 15 last, 14,768 applications had been made to the Redress Board while the average pay-out was €76,500 plus 20% legal fees.

Department of Education secretary general Bridget McManus suggested that 6,000 applications received in the last two weeks may be less severe ones, and therefore less expensive.

However, PAC chairman Michael Noonan contended that overseas cases may well be just as bad if not worse than domestic ones.

“It seems to me that if a significant proportion are from overseas, then the assertion the severest cases are dealt with is not valid. Very serious cases could be in the pipeline,” he said.

Ms McManus confirmed that all of the Church’s contribution of €128 million had now been finalised.

Cash received by the State under the deal amounts to €49.4m - €12.7m of which has been used to establish an education fund.

In addition to another direct cash payment of €2.4m, property valued at €66.2m has also been agreed, the titles to which are being transferred.

Labour finance spokesperson Joan Burton criticised the amount of compensation the State had been exposed to.

“They are out of it now and they got away with paying €128m when the taxpayer is going to pay at least 10 times that amount,” she said.

She also criticised the department for the apparent lack of information regarding the amounts of compensation paid for different institutions covered by the Redress Board.

Meanwhile, it also emerged that the Department of Education has failed to ensure teachers’ pension schemes have a firm statutory footing for more than 20 years, despite repeated warnings from the Government’s financial watchdog.

Raising the issue at yesterday’s PAC meeting, the C&AG & said the department’s failure to address the issue since 1984 could leave it open to a legal challenge.

“This is not in accordance with the legislation and may prove to be a problem if it were to be challenged in court for whatever reason,” he said.

Ms McManus said she regretted that the matter had not already been dealt with.

“It is a technical legal problem which should be addressed,” she said.

However, Ms Mc Manus said legal advice from the Attorney General had indicated that there was no risk of any financial loss to beneficiaries.