The Government is to consider closing a number of Army barracks to help pay for the massive compensation costs for alleged hearing damage by serving and retired military personnel, it has been learned.
The closure of barracks, mainly in southern and midland areas, has been sought for decades by various governments, but has always been put off because of local political considerations.
While the scale of the Army compensation claims has created a need for major budget-cutting, there is strong military pressure against any cutback in the purchase of new equipment. The Government has committed itself to diverting savings from the 1,500 reduction in Defence Forces' personnel to buying new equipment.
The Minister for Defence and the Marine, Mr Smith, commenting on last week's High Court judgment on hearing compensation, acknowledged that "economies" would have to be made in the defence budget.
He has offered claimants quick settlements so long as they are prepared to accept the "quantum" guidelines set down by the High Court in last week's judgment in which a retired soldier was given £3,000 for having only two per cent hearing damage.
Mr Smith pointed out that on this basis he was prepared to pay claimants, probably through the mechanism of a compensation board, so long as they agreed to the figure of £1,500 for each one per cent of hearing damage.
He said that the total expenditure under this proposal - amounting to at least £200 million - was a burden which would have to come from "economies" in the defence budget.
Extrapolations based on last week's damages award suggested that the overall compensation bill would be between £200 million and £300 million. This compares with estimates, based on previous court awards, that the State could be facing a total bill of between £1.5 billion and £5.5 billion.
The Chief of Staff, Lt-Gen Gerry McMahon, last night "warmly welcomed" the Minister's proposal to settle cases out of court, but said he "doubted" if the economies mentioned by the Minister were linked to the procurement programme which had been initiated to re-equip the Army with new personnel carriers.
The military staff association, Permanent Defence Forces Other Ranks Representative Association (PDFORRA), has indicated that it is considering a Supreme Court appeal against last week's judgment.
In his statement yesterday Mr Smith said: "Clearly, the expenditure of at least £200 million and perhaps more - depending on the number of claims which will continue to be made in the future - is a matter which cannot be entered into lightly.
"For this reason I intend to discuss this matter with the Minister for Finance and to bring proposals to the Government in due course for their approval in relation to the establishment of a compensation mechanism outside the courts.
"In the meantime, I am now prepared to settle cases which are coming on immediately for hearing in the courts provided that the plaintiffs are prepared to accept the Green Book assessment system endorsed by the High Court and to accept levels of quantum which are consistent with this judgment.
"I am very conscious of the burden which has been placed on the courts by these cases and will endeavour to ensure that, where possible, cases will be settled, and that ultimately a non-court compensation mechanism will remove cases from the court system completely.
"I cannot accept that the door can remain open to receive new claims indefinitely. This issue has now been in the public domain for well over three years. Individuals, therefore, should be aware of a possible link between military service and any hearing loss that they may have. I would like to state publicly that I intend to test a defence based on the Statute of Limitations in the courts in the near future.
"It is not my intention to ask the taxpayer to shoulder the entire burden of the costs of these claims and I will be looking to see what economies can be made in the defence budget towards the overall cost."