Legal costs bite into care budget

WELLINGTON: The Ministry of Social Development (MSD) has revealed that more than 60% of the money it has spent on settling historic abuse claims has gone on operational costs, legal aid and external legal fees.

Evidence presented to the Royal Commission into Abuse in Care, which is sitting in Auckland, redress hearing showed in 12 years to June 2019, MSD had spent about $77 million resolving about 1800 historic claims.

This included about $30 million paid to claimants as settlements, and $5.6 million in legal aid fees.

But the lion’s share, about $40 million, covered operational costs and external legal fees, including to payments to Crown Law.

This included a case in 2017, where the Government spent more than $1 million fighting a case it eventually lost, paying out $340,000 to four separate claimants and $369,000 in legal fees.

The claims cover people who were abused in state care, including foster families and residential homes overseen by what was then the Social Welfare Department and Child, Youth and Family and now the responsibility of MSD.

More than 2229 claims remain unresolved and about 40 new ones are coming in each month.

The Royal Commission is holding a hearing for the Crown’s response to the question of redress for those who were abused in state care.

This follows on from a hearing in September where abuse survivors spoke about how they navigated redress from state agencies.

MSD deputy chief executive for policy Simon MacPherson was asked if it was acceptable 54% of claims were still outstanding.

‘‘No, it’s frustrating obviously. ‘‘The new process introduced in 2018 is actually intended to expedite dealing with claims and resolving more of them.

‘‘It hasn’t yet delivered on that result but I think we are confident that it will do.’’

Mr MacPherson said money budgeted for the claims process had gone up and more could be expected.

‘‘But it reflects a significant commitment I think from the Government to actually attempt to resolve claims and resolve more of them, so it’s not a reduction in the budget.

‘‘It’s for a threeyear period, and it is quite possible to see that increased at the end of that period, or if we make good progress.’’

There was about $105 million set aside for historic claims over the next three years, he said.

Figures up until 31 October 2019 show 54% of claimants are Maori, 71% men and 28% women. Mr MacPherson said there was a common theme among the claimants.

‘‘Many claimants have low income, health or mental health difficulties. Difficulties finding or retaining work.’’

Many were transient and some had been in prison at some point since leaving state care.

Other claimants attributed the difficulties they had faced to the experiences as a child in state care.

The claims process, managed by MSD, was robust and did not favour the ministry, he said.

‘‘The job of social workers in the claims team is to help resolve claims, not in a sense to try and cover things up or to defend the department or its predecessors.

‘‘Social workers also have professional obligations themselves as to how they act,’’ he said.

‘‘I don’t think some dumb loyalty to the organisation would be some overriding driver here. The organisation has not set the historic claims team up simply to protect the department.’’

The Ministry of Health was responsible at the time for children who were patients at the Lake Alice Psychiatric Hospital in the 1970s.

While it is known at least 200 were physically and sexually abused, ministry chief legal adviser Philip Knipe had admitted they still did not have an accurate figure of the number who passed through the adolescent unit.

‘‘The Crown’s view is that a lot has been undertaken to enable people to come forward and we continue to deal with new claims as they come in.’’

Mr Knipe agreed that while the ministry had a settlement process, accessing information was difficult, including no reference to it on the its website. — RNZ

❛ The Crown’s view is that a lot has been undertaken to enable people to come forward and we continue to deal with new claims as they come in