My Lords, it is a pleasure to follow the noble and learned Lord, Lord Garnier. I have the second amendment in this group, Amendment 116. The amendments are connected by the word “compensation”, but they are actually about very different issues. Mine is a probing amendment to discuss how the current court-ordered compensation scheme could be improved. I thank the London Victims’ Commissioner and Victim Support for their very helpful briefings.
We know that crime can have a significant emotional and financial impact on victims, and research shows that many victims value compensation as a tangible form of redress. Court-ordered compensation is financial compensation that a judge or a magistrate orders must be paid to a victim by a convicted offender, and the money owed is retrieved by the Courts Service on behalf of the victim. The worries are that the system of payment and enforcement of court-ordered compensation is causing unnecessary distress and frustration, because too often the compensation is paid in very small instalments, over a long period, or, even worse, not at all.
The Ministry of Justice’s paper, Punishment and Reform: Effective Community Sentences, which was published in 2012, sets out that:
“Compensation orders are an essential mechanism for offenders to put right at least some of the harm they have caused. They require offenders to make financial reparation directly to their victims, to compensate for the loss, damage or injury they have caused”.
The problem is the slow payments and poor enforcement. The system of payment and enforcement is adding unnecessary distress and frustration to victims’ experience of the criminal justice system. The piecemeal nature of payments also acts as a constant reminder to the victim of the crime. This point was recognised by the Ministry of Justice, in a 2014 publication, which stated that
“the current scheme of receiving compensation can be distressing for victims because it prolongs their relationship with the offender and can prevent them from moving on from the experience”.
HMCTS has a number of powers at its disposal to collect payments from offenders, including taking money directly from their earnings or benefits, issuing warrants to seize and sell goods belonging to an offender, or, ultimately, bringing an offender back before the courts. Despite this range of powers, collection rates remained low for a number of years. In reality, many compensation orders are never paid, with victims asked by the court to write off the debt owed by the offender.
To put that in context, in quarter 1 2023, the total value of financial impositions outstanding in courts in England and Wales was £1.47 billion, up 3% on the previous quarter and 4% on the previous year. The amount of outstanding financial impositions has more than doubled since quarter 1 2015. However, we recognise that a change in policy regarding the collection of financial impositions is partially behind the cumulative increase, as unpaid accounts are no longer routinely closed, and therefore more outstanding impositions are carried over. The latest available data shows that, 18 months after being imposed, only 53% of victim compensation was paid to victims. Slightly more recent data shows that, after 12 months, only 40% has been paid, with only a quarter of compensation paid to victims within three months.
I move on to an example of good practice in the Netherlands. In 2011, the Government of the Netherlands introduced the advanced compensation scheme as part of the Act for the Improvement of Victims in Criminal Procedure. Under the scheme, the state pays the victim the full amount—up to a maximum of €5,000—of compensation awarded by the court if the offender fails to pay within eight months. The state subsequently recovers the amount due from the offender. Originally, the scheme covered only victims of violent and sexual offences, but in 2016 it was extended to cover the victims of any crime.
Victim Support’s research has shown that many victims are very distressed. One victim of crime said:
“I still have not received any compensation after a year and a half”.
Another said that
“you have to keep going and be persistent with any claims for compensation that you feel you deserve. Why should you be a victim twice?”
My amendment sets out a possible mechanism to replicate the Netherlands scheme, because we need to find some balance. The whole point of this entire Bill is to smooth the journey for victims. This final part—compensation awarded by the court, recognising that they have been a victim and providing them with some redress—is not working for our victims. I very much look forward to hearing from the Minister. Any suggestions he may have, even if he does not think this is right, would be gratefully welcomed.