A bandit in a balaclava burst into the Newcastle shop and held a knife at the throat of the young woman at the counter, the proprietor’s daughter, demanding money. Terrified, she handed over $4,000 from the till and the robber fled.
It looked to the Victims’ Compensation Tribunal assessors like a legitimate claim, and it was backed by a psychologist’s report saying that the woman suffered post-traumatic stress disorder as a result of her ordeal. If this became a permanent problem, she could expect a payout of $48,000.
Fortunately, according to evidence given recently by the tribunal’s chairman, Cec Brahe, inquiries were made by the investigating police. It turned out that the scary armed robber was, in fact, the woman’s husband, the “robbery” was a set-up and the money was stolen from her father to pay for the woman’s drug habit.
That “amazing” claim was rejected, said Brahe. But many others, equally outrageous, have slipped through the net of what was intended to be a compensation scheme for victims of terrible crimes such as murder and rape, but instead has become a multi-million-dollar jackpot for trivial and sometimes downright fraudulent complainants.
In the 10 years since the scheme was introduced, in the dying days of the previous Labor government, it has become acknowledged as the most generous in the world. Last financial year, for example, it cost more than NSW is spending to protect children from abuse and neglect – a record 8,473 people were awarded up to the maximum $50,000, for a total payout of $82 million, plus another $9 million in legal fees.
In 1996 the Carr Government, alarmed that if the scheme was allowed to continue expanding at this pace it would threaten the State’s finances, made some changes designed to eliminate nuisance claims and crack down on fraud, and appointed a parliamentary committee to investigate.
Sitting periodically with little public attention in the book-lined room at Parliament House usually reserved for National Party meetings, that committee has uncovered some hair-raising cases of abuse which it believes are just the tip of the iceberg: * A man celebrating his bucks’ night at the Pink Pussycat nightclub in Kings Cross got drunk and smashed a beer glass. When bouncers came to evict him he abused them and in the resulting scuffle he was punched, chipping two teeth. His psychologist reported that as a result he suffered post-traumatic stress disorder and “avoided places that reminded him of the incident, had a continued loss of interest in formerly-enjoyed activities, emotional numbness and a feeling of being withdrawn from others.” The tribunal gave him $9,000. * A 13-year-old boy “dropped his pants” and made some “suggestive comments and actions” to an 11-year-old girl who was standing some 50 metres away in a paddock. The psychologist’s report, said Brahe, made it appear that she had been “the victim of the most terrible case of sexual abuse” and she was awarded “substantial damages”. * A woman, 23, had her hair pulled, was punched in the face and bitten in a brawl with another woman in a nightclub. Her psychologist reported that she suffered “shock lasting more than 28 weeks” and she was now too afraid to leave her house, even to watch her boyfriend play in a band. Her claim for $18,000 was thwarted by a fluke – a police report that five weeks later the woman had been involved in another scuffle with another woman after watching a male stripper in the same nightclub.
“I have no doubt the ordinary person in the street, knowing the full facts [of these cases] would sit back on their haunches and say `what on earth are they doing down there?’,” Brahe told the committee last week.
Indeed. Since regulations were tightened a bit two years ago to abolish claims for “soft tissue injury” (typically a black eye sustained in a bar brawl), the area open to the greatest abuse has been post-traumatic stress disorder, a psychiatric illness once confined to veterans of the most horrific fighting in Vietnam, but now apparently incapacitating people subjected to the most trivial upset.
The tribunal has had a compensation claim from a female census-taker whose psychologist said she would never be able to work again after someone she was questioning “grabbed her on a certain part of her anatomy”. Women who had their handbags snatched have claimed lasting psychological injury, and one person was in shock for more than 28 weeks after being “grabbed on the left arm” by an Aborigine being ejected from a hotel.
Almost half of all applicants for compensation claim primarily for “shock”, which is the way the tribunal classifies the psychological, rather than the physical, consequences of crime. It is a generously-rewarded condition for the victim – $2,400 if it lasts up to 13 weeks, $9,600 for 14 to 28 weeks, $18,000 for more than 28 weeks and $48,000 for a “permanent disability”.
And it is quite remarkable the number of victims whose “shock” was incurred in a punch-up in a pub or club, often followed by a break-up with a girlfriend, an inability to work, or avoidance of the place where the fight occurred, which are used as evidence of serious psychological damage. “The impression is of a mixture of rorts and bona fide minor crimes … [with compensation] out of proportion to other injuries,” wrote one of the tribunal’s assessors.
There has been evidence of exploitation of the system by some lawyers, who send “victims” to see sympathetic psychologists for assessment. They may then recite the criteria for post-traumatic stress disorder photocopied from a psychology textbook, a practice condemned as “unethical” by Dr Louise Morrow, head of Davidson Trahare, the largest trauma counselling group in Australia.
Brahe said “there is not the slightest doubt that in many instances psychological/ psychiatric reports are tailored to meet section 3″ – the tribunal’s definition of “shock”. Worse, the committee found evidence that in some cases the diagnosis is made without the psychologist ever having seen the patient.
One doctor who wrote to the tribunal said bluntly that he did not “share the enthusiasm of some [psychologists] for the diagnosis of post-traumatic stress disorder, which some would describe as pre-financial gain stress disorder”.
There is no doubt that – done in volume – victims’ compensation work can be highly rewarding for the legal, medical and psychological professions. Legal costs last year alone amounted to $9 million, and the committee has identified five law firms which have specialised in the work, handling up to 400 cases a year.
For psychologists ($90 an hour is the going rate) and psychiatrists ($110), it is equally attractive – 300 of them are accredited to the tribunal, and typically medical assessment costs are $553 per case. NSW has allowed victims an extraordinary 20 counselling sessions – in South Australia and Western Australia it is three, and in Victoria, five.
Even the Victims of Crime Assistance League thinks this is going too far. Its legal officer, Howard Brown, wrote to the committee that the organisation “is aware of instances of overservicing by some providers, and we have a legitimate concern that an `industry’ is developing in the victims’ counselling area”.
No-one knows how many people require the full $2,000-worth of treatment because there is no follow-up. Professor Trevor Waring, president of the Psychologists’ Registration Board, testified: “It surprises me the number of people who get well just after they get their cheque.” Nor is there any assessment of the effectiveness of post-trauma counselling. Most major studies internationally show that the most widely-used method, Critical Incident Stress Debriefing, is either ineffective or makes the victim worse, as Shirley McHugh, who was sent to a counsellor after her son was murdered, found:
“No counselling assisted me,” she wrote to the committee. “Thousands of dollars were spent on counselling [and] out of it came the fact that counsellors spend a lot of time talking about themselves in an effort, I think, to convince themselves [that] they are doing a good job.
“… while it may be beneficial to initially have someone to speak with a victim, counselling is a waste of time. Victims’ organisations do a far better job … money is the most appropriate method of dealing with shock.”
An analysis by the Attorney-General’s Department shows that if “shock” was abolished in all but the most serious cases of permanent disorder – one of the committee’s recommendations – it would cut more than a third from the victims’ compensation bill – a saving of $33 million this year alone.
The changes to the legislation outlined last week by the Attorney-General, Jeff Shaw, do not go as far as the committee, and the tribunal, recommended. They do tighten some of the criteria for compensation, cap counselling at eight hours, and make it easier to recover money from the criminal to pay for compensation – last year less than $2 million was recovered.
But the Government has rejected the key recommendation that would have ended compensation for psychological injury, except where it could be proved to be “permanent” or associated with homicide or sexual assault. Instead, people will be able to claim $30,000 to $50,000 for “chronic psychological or psychiatric disorder that is severely disabling”.
This may sound like a minor semantic quibble. But a “chronic” disorder, even though a layman may think it sounds serious, means merely one which lasts for three months or more.
As Brahe said in evidence, arguing for abolition of compensation for “shock”: “[The victims’ compensation legislation] is something like the Taxation Act – no matter what changes you make, the legal profession will get round it.”
Victims of Crime and What They Get
Brain damage: moderate impairment of social / intellectual functions: $36,000
Loss of one eye: $50,000
Tinnitis (ringing noise in ears) lasting 6-13 weeks: $2,400
Loss of one front tooth: $3,600
Wrist sprain, disabling 6-13 weeks: $2,400
Multiple first-degree burns covering at least 25% of the body: $50,000
Fracture of thighbone (full recovery): $7,200
Sexualt assault (most severe category): $25,000-$50,000
Loss of fertility: $50,000
Strained back, disabling for more than 13 weeks: $6,000
Sprain of one ankle (disabling for at least 6-13 weeks): $2,400
Tendon/ligaments (severe damage, full recovery): $7,200
Displaced fracture of nasal bones: $3,600
Partial loss of smell and / or taste: $12,000
Permanently clicking jaw: $12,000
Loss of thumb: $36,000
Loss of arm: $50,000
Shock lasting over 28 weeks: $18,000
Pub date: Saturday 31 October 1998
Section: News And Features
Sub section: News Review
Word count: 1707
Classification: Law/Compensation Crime/Victims
Geographic area: Australia NSW
Caption: Rich pickings … . victims of handbag snatches are among claimants awarded thousands of dollars in compensation for “shock”.
Photography: James Alcock
Table: Victims of crime what they get