LOWER PERSONAL INJURY COMPENSATION AWARDS FAILING TO TAKE INTO ACCOUNT SPIRALLING INFLATION AND COST OF LIVING INCREASES
Many independent commentators and advocacy groups have been critical of the new lower compensation award levels introduced here in March 2021. Current compensation awards for some types of injuries have been cut by nearly 70%.
The Personal Injuries Guidelines Committee, which in 2020 recommended significant reductions to Personal Injury awards in Ireland, was advised by Economic Consultants at that time that inflation and the cost of living in Ireland was unlikely to rise significantly in the future.
While the Inflation rate in Ireland in 2020 was -0.33% it has now risen to 9.1% which is the highest level in Ireland in 38 years. Housing and utilities costs also rose by 22.5% in June and transportation costs rose by 20.4% all of which have a significant impact on the real financial value of compensation awards.
Speaking about the economic impact of spiralling inflation on personal injury awards Liam Moloney Solicitor said today “the essential purpose of compensation is to, as far as possible, enable the person who has suffered personal injuries from negligence to get back to a normal life i.e., the position they were in before the negligent act occurred. It is not to enrich someone. That includes ensuring that the full costs of ongoing and future medical treatments, care costs and transportation are paid in addition to compensation for pain and suffering.
Injury victims place huge value on compensation because it helps them get back on track and recover from the negative fallout that was caused by the negligence in the first place”.
Mr Moloney added “it is essential for the fair delivery of appropriate compensation that the real financial value of such payments is re-assessed given the dramatic increase in the cost-of-living standards here. These new guidelines should be immediately reviewed to ensure that injustice is not being done to people who are injured through no fault of their own”.
Our awards for certain types of injuries are comparable now to Romania and Poland but the cost of living in Ireland and the cost of medical treatments here are hugely more expensive than in those Countries.