Changes in the courts system, improved road safety and the setting up of an interim Personal Injuries Assessment Board will be among proposals announced later today by the Tánaiste to tackle insurance costs.
The Irish Times has learned that Ms Harney will announce the setting up of a Cabinet sub-committee, which will look at how measures to reduce accidents and reform of the court system could contribute to savings in legal costs.
The sub-committee will consist of the Attorney General, Mr Rory Brady SC, the Minister for Justice, Mr McDowell, and the Minister for Transport, Mr Brennan.
She will also announce the setting up of the interim board of the Personal Injuries Assessment Board. It is expected that its chair will be Ms Dorothea Dowling, who recently chaired the Motor Insurance Advisory Board.
The setting up of the assessment board, along with court reform, was among its recommendations, published recently. The interim board will draw up a basis for assessing compensation, based on the levels of awards already made by the courts. It will then be set up on a statutory basis when the legislation has been prepared.
It is not intended that the board will give less compensation than the courts, but will carry out the work more quickly and efficiently.
However, two reports drawn up on behalf of the Law Society and the Bar Council by accountant Mr Des Peelo and economist Dr Peter Bacon have cast doubt on the savings likely to be achieved, and warned that the board could end up costing even more than the current system. It is understood Ms Harney met Dr Bacon yesterday.
On the other hand, the Motor Insurance Advisory Board report noted that 90 per cent of cases are settled before they go to court. The majority of settlements are also for less than £7,500. It was clear from the report that Ms Dowling felt many of these could be dealt with outside the court system.
The Personal Injuries Assessment Board will not deal with contested cases, but only cases where liability is not an issue, in which event, the case will go into the adversarial court system. It appears Ms Harney has decided to adopt a two-pronged approach to the legal costs component of insurance. These costs, which include the costs of the experts called by both sides, run to about 40 per cent of compensation awards. The insurance industry has argued that these contribute significantly to the exceptionally high costs of premiums in Ireland.
Representatives of the employers' group IBEC and the insurance industry have argued for a board which would assess compensation outside the court system, to bring costs down, while the Law Society and the Bar Council have argued for reform of the legal system.