Compensation claims against State increase by 22%

The total cost of outstanding compensation claims against the State jumped 22 per cent to €2.2 billion by the end of last year, figures published on Friday show.

Accounts for the State Claims Agency, which manages legal actions taken against the State, show the number and cost of legal actions involving public bodieshave been rising in recent years.

At the end of 2016, the estimated cost of outstanding compensation claims against the State had risen to €2.2 billion from €1.8 billion 12 months earlier, an increase of 22 per cent.

“The number of claims under management has increased significantly since 2011,” according to a report on the agency by the Government’s financial watchdog, Comptroller and Auditor General (C&AG) Séamus McCarthy.

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The figures show there were 8,900 legal actions pending against the State at the end of 2016, compared with 6,000 five years earlier.

In 2016, the agency paid out €256.2 million in compensation awards and legal costs. This was about 20 per cent more than the bill for the previous year, which was €219.3 million.

Almost 2,300 legal actions against the State were concluded last year, a 24 per cent increase on 2015.

A Supreme Court ruling that drove up the amounts awarded in compensation contributed to the rising cost of the outstanding claims. The court decided sums paid to anyone who successfully sues for damages should increase as the returns on the cash they receive have fallen.

HSE and Tusla

Claims against the Health Service Executive and child protection agency Tusla accounted for €1.9 billion of the €2.2 billion total.

The Department of Health accounted for claims totalling €27 million, and the Department of Justice and Defence, including the Gardaí, prison service and Army, was responsible for claims worth €175 million.

Cases against the Department of Education had an estimated bill of €50 million. Other departments and agencies were responsible for cases worth a further €27 million.

The State Claims Agency is part of the National Treasury Management Agency (NTMA), the body that borrows money on the Government's behalf and helps manage the Republic's finances.

The Government established the State Claims Agency in 2001 specifically because it was concerned at the growing number of compensation claims being taken against the State.

It handles personal injury, clinical negligence and property damage claims taken against State bodies.

Along with the claims body, the NTMA is responsible for the National Assets Management Agency (Nama) and New Era, which oversees commercial State companies.

The NTMA also includes the Irish Strategic Investment Fund, meant to aid businesses that create jobs, and oversees the liquidation of the Irish Banking Resolution Corporation, which took over the insolvent Anglo Irish Bank and Irish Nationwide.

The C&AG’s report on the NTMA shows the body employed 782 people at the end of 2016, 302 of whom were in Nama and 128 with the State claims agency.