23 May 2018
Debate resumed from 9 May; motion of Mr PAKULA (Attorney-General).
Mr PESUTTO (Hawthorn) (16:32:44) — I am pleased this afternoon to be able to speak on the National Redress Scheme for Institutional Child Sexual Abuse (Commonwealth Powers) Bill 2018. Acting Speaker, the work continues — the work which began many years ago now with brave agents of change who spoke up to authority and who took great risks and overcame great anguish and pain to speak up on their own behalf and on the behalf of so many others. That work continues today. I am pleased at the outset to be able to advise that this bill will pass. We certainly do not oppose this bill, and I say that with some pleasure having had the very brief pleasure of joining some people in the gallery today who are themselves very engaged on this issue. From what I understand from my discussions with them they wish to see this bill pass.
This is an important bill, as with the many reforms that have preceded it, because it will offer survivors of child sexual abuse — meted out to them by people in institutions over many years — the option of avoiding the painstaking, traumatic and often burdensome exercise of litigation in the courts. I think I can say that a national redress scheme certainly has enjoyed in-principle support across the board.
There has been a lot of debate over recent years about particular aspects of the bill — its scope, who was in and what processes need to be implemented to enable survivors to obtain some small relief for what they have had to suffer. I think this bill — which joins with the commonwealth and New South Wales and, as I understand it, as of today’s date the territories and Queensland and potentially other states that might join it — provides a real opportunity for a national redress scheme to spare survivors that otherwise painstaking task of litigation.
We do not oppose today’s bill — and I will talk about aspects of the scheme in a moment — but I just wanted to say that all of these important steps follow profound and historic steps that have preceded these ones today. I guess a lot of work has been done over many years, but there are people in this chamber today who were members of the last Parliament when a committee — chaired by Georgie Crozier in the other place and deputy chaired by the member for Broadmeadows, with members including David O’Brien, formerly of the other place, Andrea Coote, formerly of the other place, the member for Thomastown and the member for Ferntree Gully — delivered a historic report, the Betrayal of Trust report, which paved the way for a number of important changes in our laws and processes.
First among them was to introduce offences to make it clear that those in positions of authority and power shoulder a legally enforceable obligation to speak up and do something. No longer is it possible for people in positions of authority — or, for that matter, any people seized of knowledge — to simply pass problems from one location to another. They were important reforms.
Further work was undertaken off the back of earlier work under both Liberal and Labor governments over many years to improve and enhance reporting requirements, improve working with children checks and also tackle the problem that many victims and their loved ones faced with some of the more draconian aspects of civil procedure, which would sometimes operate as bars to claims in the courts. Limitation periods were addressed, and some of that work has been undertaken in this current Parliament, which we have supported.
These are just some of the important reforms that have preceded today’s subject matter which is contained in this bill. I think all sides of politics can take some credit and comfort in the work that has been undertaken, but that by no means suggests that our task is complete. More will need to be done even after this bill passes through this Parliament, as I happily predict that it will.
Turning to what this bill does, it is important in this respect that we as a Parliament are going to refer powers to the commonwealth Parliament under section 51(xxxvii) of the constitution of the commonwealth for their ability to implement a national redress scheme. This cannot be done without the support of states who are signing up to it. As we know, earlier this year the Victorian government and the New South Wales government announced that they would be supporting the scheme, and I think that is important. Hopefully other jurisdictions will join the scheme, which will provide more uniformity and consistency across the country. We hope that this scheme will continue to attract others jurisdictions to it, but it does depend on a referral and also a power, as the scheme evolves, to make amendments within the scope of the referral power.
It is particularly complex in that regard in that we are doing something that we do not often do, which is to refer our constitutional powers to the commonwealth. We do so in the spirit of cooperation with the commonwealth, all being of a like mind that we want to make the pathway to the vindication of rights easier for those who have suffered.
Of course it is not only dependent on a referral of constitutional powers; this scheme will — and should — involve appropriate levels of funding to ensure that those victims receive monetary amounts, support for counselling and in some cases other measures such as formal apologies, which will go some way to assuaging the anguish, pain and trauma that they have suffered. That funding is very important. I just want to call on the government to make sure that that issue of funding is properly addressed. It is not dealt with in the body of the bill, and none what I am saying in relation to the funding in any way detracts from our sincere hope that this bill will pass very speedily through this Parliament, but I have been speaking to stakeholders in recent times about their views on the redress scheme, and everybody is of like mind that this should come into being as quickly as possible. But I have been advised of a number of concerns around funding, because in relation to particularly non-government organisations, which provide valuable services in our community but nevertheless may have in times past employed or engaged people who committed atrocious and despicable acts on innocent victims, their ability to meet their liabilities under this scheme is at the moment clouded in uncertainty for them. I have spoken to people as recently as this afternoon about this.
In particular there is an issue that I hope the government will deal with very quickly around the Victorian Managed Insurance Authority (VMIA). I have been advised by a number of people in the sector who will be affected by this that they have been informed by the VMIA that their liabilities under this redress scheme will not be met by the VMIA. That has come as a great surprise and shock to these organisations because they do support a redress scheme, they want it to go ahead, but they do not know what they are going to do.
We have seen some reports in the media, including in the Australian newspaper today in an article by John Ferguson that points to some of the uncertainty around the VMIA’s position. If the VMIA is not going to fund or indemnify organisations that have signed up to the scheme and may be held liable under the scheme — and I will talk about the processes in a little while — what happens? Does that mean that the only way they can be covered is by calling on government? Is their liability, given that Victoria has signed up to this scheme, going to be met out of budget allocations, general revenue or the VMIA? At this stage the VMIA’s position is, as I was advised this afternoon, the same as it was in recent days — namely, the VMIA is not going to meet the costs of claims against organisations that have previously enjoyed and continue to enjoy coverage from the VMIA.
It is a matter of some concern because we know that the dividends that the VMIA have produced have been called in by government in large measure. That may be a reason why it is not extending coverage to these organisations, but the matter had better be sorted out quick smart, because we are facing a commencement date, which no-one wants to delay, of 1 July 2018.
I did note in budget paper 3 that the government has only allocated $7.7 million in anticipation of liabilities for civil claims costs in relation to cases of institutional child sexual abuse, and that it is only for the 2018–19 year, with nothing allocated in the outer years of the forward estimates. There is a narration later in BP 3 that seems to indicate that the government is awaiting more details about the full impact of the redress scheme. The reason that concerns me is that, as I have said a number of times in my remarks, we all support the redress scheme and we all want it to come in as soon as 1 July 2018, but if the government does not know what impact the scheme is going to have, even in terms of estimates, that is a matter of concern for us, and I can well see why it is a matter of concern for those organisations that are going to be party to this national redress scheme. So I call on the government to quickly make clear what do its best actuarial forecasts indicate about Victoria’s exposure to the national redress scheme?
That is not to say that it would in any way change any of our support for the redress scheme; that is a given. But we do need to know what the impact is. That is the first thing. To say only some eight weeks or so out from the commencement date of the redress scheme that we do not know what the impact is going to be is not really adequate, I think, because everybody needs to prepare for this. The organisations that are going to be affected, that are going to receive claims, that are going to be party to the scheme, need to have some idea of what they are dealing with and who is going to meet their liabilities, whether it is the government or the VMIA. So, again, I call on the government to do that.
As for the scheme itself, it is quite complex. I am not going to pretend in the short time I have got left to go through everything, but I did not want to note some key things about it in relation to its scope and some aspects of the processes around it. We do know that there are very clear eligibility requirements for the scheme. It must start with the question of abuse, and abuse is given a definition in the proposed dictionary to the national act, which we will adopt. Abuse means sexual abuse or non-sexual abuse, and non-sexual abuse includes physical abuse, psychological abuse and neglect, so it is fairly tight. It is not as broad a definition as you might see in other pieces of legislation.
I understand what some of the concerns around government have been — that in order to attract more willing participants to the scheme, because remember it is an opt-in scheme, you need to at least be able to attract more and more parties to it. The more people who are involved in the scheme, the better it will be, because it will relieve more victims and survivors of the need to approach the courts and indeed will spare the courts the need to adjudicate claims in their own jurisdictions. So it starts with abuse. The abuse must have occurred when the person who would be the claimant was a child, it must have occurred before 1 July and it must have occurred in a participating state, and of course we hope that more states will join the system.
Turning quickly to how one goes about making a claim, it really starts with the claimant himself or herself. There are detailed provisions for how an application is to be made, prescribed documentation and the like. In meeting the eligibility requirement the person must have been sexually abused or otherwise abused within the scope of the scheme; the abuse is of a kind for which the amount of redress payment worked out under the assessment framework in the bill will be more than nil but up to a maximum of $150 000. There has been some discourse around the issue of what standard has to be met in order for the scheme to recognise a claim as valid and for it to be met. What the scheme has settled on, and we think this is appropriate, is that the operator, who is the secretary of the federal department administering the scheme, must be satisfied that there is a reasonable likelihood that the person is eligible for redress. That is a slightly tougher standard to meet than the balance of probabilities, but I think it is something that has enjoyed general consensus that it is the best approach to adopt in relation to that.
It is up to the person who has made the claim once that decision is made by the operator to accept or reject it. It is important that in a scheme like this that although you obtain some benefits by administrative efficiencies you still need to account for those situations where a claimant might want to dispute a finding by the operator. So if the operator, for example, declines a claim, then the person who has made the claim has a right to seek a review. That review can be undertaken internally or if the operator commissions an external independent person to conduct that, then it can occur in that fashion.
It will also provide that where a person accepts the offer, the person becomes entitled to redress, the person is required to release the institution or institutions, if there are others, and also the officials who may have been involved in that from all civil liability for the abuse.
So it does not exculpate anyone or any institution for any criminal behaviour, which it may well be, but it certainly provides some finality so that if a claim is accepted and if a person who has made a claim for a monetary amount and counselling and the like under the redress scheme accepts that amount, then that will conclude the civil claim by that person against that institution. That is important obviously, to finalise matters. That is the whole point in a scheme like this.
Just turning to some of the other aspects of the matter: in terms of how matters are to be assessed, the operator must satisfy a range of fairly prescriptive steps in determining whether a person is entitled to it — first of all, meeting the standard, but then what that amount is. As I said, that is subject to review under the scheme. It is important also to realise that a determination in favour of an application only has effect in relation to the scheme itself, so it does not have broader application and there are very strict limitations around the admissibility of materials that are produced in the course of a claim for other contexts. So I have spoken about the concept of offer and acceptance, and there is clearly finality in the way these matters are concluded.
Just turning to a clause which has been raised with me by a number of stakeholders — some have raised uncertainty around insurance. I think putting aside the issue of the VMIA, which I spoke about before, the redress scheme does propose to clarify that where organisations are drawing on their insurance coverage section 49 of the proposed national act provides that a redress payment is a payment of compensation under the scheme. It carves out a couple of exceptions but it makes it clear that, in other words and in effect, it is an insurable event under their policies.
I have had many discussions with people in organisations that may be affected by the redress scheme, and of course the complication for insurers is that while some may be tempted to deny indemnities for their insured clients, it is important to understand — particularly for those in the insurance community — that that may well produce a more onerous burden for the insurer if a claimant is left with no choice but to follow a litigious path rather than pursue a claim through the redress scheme. So the decision confronting insurers is that it is probably better in some ways to participate in this scheme than to force claimants — because of obstacles of coverage, particularly if the government is not going to indemnify — to approach the courts.
From the insurer’s point of view many of them have concerns about the level of rigour in the assessment of claims. Many in the insurance community are worried that if you have a redress scheme, the standards of proof, the testing of evidence, cross-examination and the like are either not present, or if there is some kind of exacting assessment of the weight to be attached to evidence, it is just not something that compares well with what would go on in normal litigation. Whilst there may be some truth to that, I hope and trust that on reflection if you have got a scheme that can minimise enormously the time and legal costs involved in satisfying claims from victims, you can usually work out very quickly the meritorious nature of the claims.
My own view is that it would probably be counterproductive to take a position that would force, in effect, any claimant to seek relief from an organisation that has to choose to stay out of the scheme because to be in it would mean they are denied an indemnity under their insurance policy. It is really important that everybody involved in the scheme sees the upsides in a scheme like this and does not get spooked by some of the differences that are to be employed in assessing claims within a national — or any — redress scheme, when compared with litigation. The whole point, of course, is to provide an earlier resolution of the claims.
Certainly in terms of insurance I think it is fairly clear that this will benefit not only claimants but the insured clients as well. I do note that there are strict provisions around the disclosure of information. I think that is very important, because when you have a redress scheme, many parties to that are taking positions that they might not have taken in litigation. I think that the integrity and workability of a scheme like this is improved if there are very strong protections around what can be done with information in a scheme like this that is produced in the course of the assessment of a claim. So I think that is really important.
The only other thing I really wanted to touch on — because as I said, the scheme itself is exceedingly complex — is that we hope that the government will bring any major matters back to this Parliament if it is proposed that the scheme be changed in any significant way. The bill proposes that the government has a fairly wide berth in what it can do if the federal government wants to change aspects of the scheme. To some extent that is understandable, because when you have a referral of power you have to allow for some unforeseen events and developments; that is pretty standard. But with a scheme like this, given what it involves, we hope and trust that the government will respect our wish to be involved in any significant future changes. We are not asking the government to come back to the Parliament if there are minor changes that are fairly straightforward, but we do expect that the government will come back to us in the future if there are going to be any significant changes to the national redress scheme.
I do not have any further contributions to make other than to conclude where I started. In the interest of those who have taken the time to come to Parliament today — and whom I had the pleasure of meeting very briefly before my remarks — this is an important step. It will bring great relief, I hope and trust, to many claimants who would otherwise be forced to go to the courts to vindicate their rights, and I look forward to this bill passing the Victorian Parliament.