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National Audit Office Press Notice

Class VIII Vote 1 1994-95: Police, Criminal Injuries Compensation and Other Grants, England and Wales

Report by the Comptroller and Auditor General as part of:
Appropriation Accounts 1994-95 Volume 6: Classes VII and VIII - Environment and Home Office and Charity Commission
HC 15 - VI 1995/96
1 February 1996
ISBN: 010264196X
Price: £13.60

The Comptroller and Auditor General, Sir John Bourn, today reported the results of his examination of the above Appropriation Account. He has qualified his opinion on the account because of irregular expenditure of £6.944 million on grants for compensation payments to victims of violent crimes. These payments became irregular when a judgment of a Judicial Committee of the House of Lords ruled that the method, by which a tariff based scheme for criminal injury compensation had been introduced, was unlawful. In 1994-95, total expenditure on grants to the Criminal Injuries Compensation Board for payments to victims of violent crime, included in the Class VIII Vote 1 Appropriation Account, was £168 million.

Since 1964 the Criminal Injuries Compensation Board has administered a non statutory compensation scheme for victims of violent crime based on common law damages. The scheme was codified in the Criminal Justice Act 1988 but the provisions of the Act, relating to the scheme, were not brought into force. Compensation payments continued to be made on an ex-gratia basis under the authority of the annual Appropriation Act.

In November 1992, the Government announced its intention to replace the common law damages scheme with one based on a tariff of awards. The tariff based scheme was introduced on 1 April 1994 with the aim of delivering a better service to claimants through a scheme which produced quicker decisions on awards and was more straightforward and easier for claimants to understand. As with the common law damages scheme, it was to be non statutory with authority for payments being made under the annual Appropriation Act.

In May 1994 the High Court heard an application for a judicial review of the decision to introduce the tariff scheme. The Court found that the introduction of this scheme was not illegal, unconstitutional or improper but they gave the applicants leave to appeal. In November 1994, the Court of Appeal ruled that the Secretary of State could not introduce, under his prerogative powers, a tariff based scheme which was radically different from the scheme which Parliament had approved and whose provisions remained unrepealed under the Criminal Justice Act 1988. The Court of Appeal ruling was upheld by a Judicial Committee of the House of Lords in April 1995.

While the uncertainty over the final outcome of the judicial review continued, the Home Office decided that there was no realistic alternative but to process tariff scheme cases on a without prejudice basis. The effect of the House of Lords judgment was that all the compensation payments made under the tariff scheme in 1994-95 totalling £6.944 million were irregular. Over 71,700 claims were received in 1994-95 under the tariff scheme. Decisions had been issued on 15,606 of these claims which must be reassessed under the common law damages scheme. As at 5 January 1996, 5,130 claims had been reassessed and the outcome communicated to the claimant. Of these, 1,113 resulted in higher awards under the reinstated common law damages scheme with an increase in value of £1.134 million; 3,917 awards remained unaltered; and 100 resulted in lower awards totalling £0.217 million.

Following the judgment of the Judicial Committee of the House of Lords, the Secretary of State introduced a bill to provide for a tariff based scheme. This received Royal Assent on 8 November 1995. The resulting Criminal Injuries Compensation Act 1995 repeals the legislation for a common law damages scheme in the Criminal Justice Act 1988 and provides statutory authority for a tariff based compensation scheme which will be introduced on 1 April 1996.

Note for Editors

The Comptroller and Auditor General, Sir John Bourn, is head of the National Audit Office employing some 750 staff. He and the NAO are totally independent of Government. He certifies the accounts of all Government departments and a wide range of other public bodies; and he has statutory authority to report to Parliament on the economy, efficiency and effectiveness with which departments and other bodies have used their resources.

Press Notice 10/96
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