The State’s ongoing failure in making workable PPO’s available to catastrophically injured Plaintiffs in this jurisdiction is unacceptable.

Periodic Payment Orders (PPOs) are an alternative to a lump sum settlement for catastrophically injured plaintiffs, providing for an ongoing annual payment over the lifetime of a claimant rather than a single lump-sum compensation payment.

The PPO legislation is set out in Section 2 of the Civil Liability (Amendment) Act 2017 and was commenced on the 1 October 2018, 8 years after the Working Group on Medical Negligence and Periodic Payments in Ireland recommended the introduction of periodic payments here.

However, claimants in catastrophic injury cases have been electing to take lump sum payments or interim payments in lieu of PPO’s following a ruling by the High Court in 2019 in the case of Hegarty v HSE (where we acted for the Plaintiff).  The High Court in Hegarty stated that the indexation rate set out in the above legislation would result in under compensation for claimants as it did not take account of wage inflation.

Four years post the Hegarty decision, Part 3 of the Courts and Civil Law (Miscellaneous Provisions) Act 2023 was introduced and it provides for the setting of the indexation rate for PPOs by ministerial regulations.

Following the Hegarty decision, the former Minister for Justice decided to establish yet another Inter-Departmental Group to advise on an appropriate indexation rate for PPOs.  Their Report was published last year.  The new periodic payment index proposed in the July 2024 Report of the Inter Departmental Working Group on Identifying an Indexation Rate for Periodic Payment Orders (which is 80% average Annual Rate of Change in nominal hourly health earnings and 20% of the HICP (Harmonised Index of Consumer Prices)) is an improvement on the choice of indexation set out under the 2017 Civil Liability Act which was 100% HICP.  HICP is used to measure consumer price inflation.  In 2019 the High Court determined in Hegarty v HSE that HICP would result in under compensation for plaintiffs availing of the PPO option because HICP was not a wage based index.  The July 2024 Report acknowledged correctly that the indexation needed to be linked to a wage based index to ensure full compensation for the future care needs of catastrophically injured Plaintiffs.  The Report, recognised labour costs comprise at least over half of a settlement and in many cases up to 90% of it.  Four options were considered as possible indexation rates for PPOs by the authors of the Report yet it appears they recommended the least costly option.

In addition to the indexation issue, the 2024 Report noted concerns raised in the Hegarty case by the Plaintiff’s legal team of the lack of a provision in the PPO legislation allowing claimants to return before the court to seek an amendment of a PPO;  unfortunately the 2024 Report did not make a recommendation on this and there is still no provision in the Irish PPO legislation for variation orders yet catastrophically injured Plaintiffs in other jurisdictions such as England can avail of this option in appropriate circumstances.

Some parents of catastrophically injured plaintiffs whom we act for would like to see a workable PPO being made available to them urgently.

Twelve months on from the publication of the above 2024 Report, it is not known when the proposed indexation rate for PPOs will be set by regulations/approved by the Oireachtas.

As matters stand Irish catastrophically injured plaintiffs are being deprived of the option of electing for a workable PPO nearly 5 years post the Hegarty decision and 15 years after PPOs were recommended in the 2010 Report described above and in circumstances where catastrophically injured Plaintiffs in other jurisdictions can avail of this option.

Contact us at Cantillons Solicitors at +353 (0)21 4275673 or info@cantillons.com  if you would like more information.

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