I. INTRODUCTION

18.1 The reasons for selecting transport accidents as the subject of the Scheme proposed in this Report have been given earlier (paragraphs 1.33-1.46). They need not be repeated here. But in developing a Transport Accidents Scheme we have not lost sight of the breadth of our terms of reference, nor of the objective of a national compensation scheme, towards which no-fault compensation for transport accident victims is the first step (paragraph 4.58).

18.2 It is appropriate to conclude this Report by briefly referring to the drawbacks of a limited scheme and to the contribution the Transport Accidents Scheme can make to the broader issues posed by national compensation. Two specific questions need to be addressed.

• To what extent would a national scheme overcome unavoidable drawbacks of a limited scheme?
• Are the principles established for the Transport Accidents Scheme suited to compensation for disability and incapacity in areas other than transport accidents and, in particular, for a national scheme?

The answer to the first question is inherent in much of what has been said in Chapter 14 (Scope of the Scheme) and the answer to the second question has been anticipated at a number of points in the Report, especially in the discussion of policy in Chapter 5. What follows briefly brings together these observations.

II. THE DRAWBACKS OF A LIMITED SCHEME

18.3 Etiology, or aetiology, is the assignment of cause. This task is inevitably associated with a scheme which is less than comprehensive in its coverage. As demonstrated in Chapter 14, eligibility for compensation under a Transport Accidents Scheme depends upon whether the death or injury for which compensation is sought can be assigned to a transport accident For this purpose. transport accident must be defined (paragraphs 14.3-14.15) and rules developed which determine whether the necessary causal link exists between the transport accident and the incapacity or disability for which compensation is claimed (paragraphs 14.21-14.39). In borderline cases, the application of these rules and definitions may create difficulties. Of similar difficulties arise under existing compensation systems, which like the proposed Scheme, apply only to certain categories of accidents. ¹ The difficulties created by the workers’ compensation system have been the subject of recent critical comment.

The whole system rests on a false assumption. It assumes the feasibility of classifying human disabilities and deaths by reference to causes. It assumes the feasibility of distinguishing those that resulted from employment from those that did not. The assumption is absurd, and yet we have persisted in retaining it with all its consequential injustices, including the denial of compensation to many workers whose disabilities probably did result from employment. ²

18.4 The practical problem of attributing cause, with its difficulties and the risk of injustice, is not the sole, or even primary drawback of a scheme of limited coverage. The most serious deficiency in any limited compensation scheme is that, by its very nature, it fails to compensate accident victims whose injury or death lie outside its scope. Very large numbers of people are injured every year in Australia in accidents which are neither transport nor work-related. The vast majority have no entitlement to common law damages, and only a very few are entitled to any form of statutory compensation. Those with lasting incapacity are forced to rely on the social security system. ³

18.5 The ultimate solution to the problem of etiology lies, to use the language of the Woodhouse Committee, in the basic concept of “comprehensive entitlement (which) calls for equal treatment for equal claims”.

Whatever the cause of incapacity and wherever it might occur, society must no longer tolerate the grudging and artificial discriminations that until now have blemished the distribution of public moneys supplied by the community at large. ⁴

But it should be noted that only a truly comprehensive scheme, covering injury, disease and congenital abnormalities, will achieve the objectives of comprehensive entitlement and eliminate disputes over etiology. Even if a comprehensive accident compensation scheme were introduced, some of the most difficult etiological problems would remain, since it would still be necessary to distinguish between a person incapacitated by accident and one incapacitated by illness. For example, a person sustaining a stroke caused by an accidental blow to the head would be compensated, while a person sustaining the same disability as a result of a degenerative artery disease would not be covered under the Scheme. ⁵

18.6 A scheme confined to one State or Territory has the disadvantage that its scope must be defined in terms of an appropriate connection, or connections, with that State or Territory (paragraphs 14.40-14.49). Whatever the precise definition employed, anomalies will be created (or preserved) which may leave a particular accident victim with no compensation (paragraph 14.46), or with rights to compensation under more than one scheme (paragraph 14.92). It is possible to overcome these anomalies by cooperation among the States and Territories although in the absence of a national scheme promoted by the Commonwealth, complete cooperation among all Australian jurisdictions for this purpose may be difficult to achieve. Clearly a national scheme is the best way of removing the disadvantages of a scheme limited to a particular geographic area.

18.7 The result is that only a national scheme, fully implementing the principle of comprehensive entitlement, can overcome the inequities created by a limited range of overlapping schemes offering different levels of compensation.

III. FROM TRANSPORT ACCIDENTS TO A COMPREHENSIVE SCHEME

18.8 The Transport Accidents Scheme proposed in this Report is capable of being implemented without changing the existing arrangements for other kinds of accidents. However, the Scheme could also be the first move towards the objective of a comprehensive, national scheme. This objective could be pursued in a number of ways. It would be within our terms of reference to examine possible extension of the Scheme to areas covered by existing but less adequate statutory schemes. These include criminal injuries (paragraphs 2.47-2.49) and sporting injuries (paragraphs 2.50-2.51). Similarly, we could consider extending the Scheme to areas which, like transport accidents, are still governed almost exclusively by the common law, such as home or school accidents or injuries caused by defective products or medical misadventure.⁶ With the cooperation of the Commonwealth and other States and Territories, it would be possible to extend the Scheme “horizontally”. This would involve some or all States and Territories introducing a transport accidents scheme substantially identical to that in New South Wales ⁷ (assuming implementation of our proposals). Cooperative action, perhaps encouraged by Commonwealth financial support, could extend the Scheme in other jurisdictions to areas other than transport accidents, thus expanding the scope of uniform compensation arrangements.

18.9 The appropriateness of the Scheme to new areas of accidental injury is thus likely to receive consideration by policy makers. In our view, the Scheme’s based on sound principles and is capable of universal application. Nonetheless we recognise, as one distinguished commentator has pointed out, that there is no single solution, or set of solutions, to the policy questions posed by the preparation of a no-fault scheme. ⁸ Reasonable people can and do differ on the approach that should be taken to the difficult questions at stake. The reality is that every proposed scheme is, to some extent, a product of its particular time and place. For example, we have had to devote more attention than the Woodhouse Committee to the problems presented by endemic unemployment for a compensation scheme, since the economic circumstances of the 1980s are very different from those of the early 1970s.

18.10 What the community receives from the compensation system (or systems) depends ultimately on what it is prepared to pay. The proposals for a Transport Accidents Scheme has been influenced by the fact that the community has long accepted that funds should be provided for compensating victims of transport accidents. This is an area in which the restitution principle is entrenched (albeit for a limited class of victims) and the funds currently available for compensation purposes are adequate, for example, to provide earnings-related compensation to transport accident victims. While the Scheme has not been prepared with a fixed cost in mind, we have not been faced with the difficulty of preparing proposals in areas where there is no established source of funds for compensation purposes. Nor have we had to consider classes of accidents in which compensation (to the extent it is available) has been assessed by reference to principles quite different from those applied by the common law, such as those applied under the Sporting Injuries Insurance Act, 1978 (paragraph 2.50) and similar statutory schemes.

18.11 As we have indicated, the Scheme could be extended to new areas. Certainly the principles underlying the Scheme are capable of universal application. Yet if the resources available in other areas are found to be more limited than those available for compensating transport accident victims, some modifications maybe required to enable the extensions to be made. Some might consider, for example, that it is more desirable to extend no-fault compensation to areas where few accident victims have previously been compensated, than to apply the restitution principle consistently. On this view, the priority should be to ensure that all accident victims receive compensation at a level adequate to support them, than return favoured categories of accident victims to their pre-accident position. Ultimately it may also be desirable to attempt to integrate the compensation and social security systems, so that all people who, for whatever reason, cannot support themselves receive adequate levels of support.

18.12 Considerations which do not arise in transport accidents will have to be taken into account in other areas. For example, the rape victim may suffer no permanent physical disability, yet it may be thought that the personal indignity and emotional distress sustained by the victim requires monetary compensation.

18.13 However there are some features of the proposals in this Report that we would regard as essential to any extended scheme, including a national compensation scheme. Without being exhaustive, these include:

• elimination of fault as a criterion of entitlement to compensation;
• positive measures to promote safety and accident prevention;
• maximum incentives and aids to rehabilitation;
• periodic compensation for economic losses and the matching of benefits to losses sustained by accident victims;
• priority to secure and adequate compensation to those sustaining serious and long-term disability and incapacity;
• adequate compensation to non-earners sustaining long-term loss of earning capacity;
• the integration of the compensation and general health care systems;
• administration of the scheme in accordance with the principle of entitlement with emphasis on high quality decision-making; and
• in independent appeal system, providing review on the merits by a judicial tribunal.

While it is most important that these basic features be retained, the details of the Scheme are not immutable. If modifications on non-essential matters are required to achieve a national compensation scheme, they should be considered carefully. The principle of comprehensive entitlement, that is equal treatment for equal claims, is the ultimate objective. The Transport Accidents Scheme should assist in the attainment of that objective, and thereby bring about a fairer and more efficient compensation system for all Australians.

1. The common law negligence action is not, in terms , confined to particular categories of accidents. But the problem of etiology still exists, because the plaintiff must show among other things that his or her loss was caused by the defandant’s breach of duty. In addition, there is the further practical problem that a common law remedy in certain areas, such as motor vehicle accidents, is effective only because it it supported by a system of compulsory insurance with its own etiology.

2. T G Ison, “Workers’ Compensation - the Canadian Experience”, paper delivered at the conference entitled “Workers’ Compensation - New Directions?”. South Australian Ministry of Labour, (Adelaide, May 1984), p.25.

3. A recent study in England confirms this. See D Harris et al, Compensation and Support for Illness and Injury (1984).

4. Australian Woodhouse Report, vol.1, para.255.

5. This is the position under the New Zealand Scheme. See T G Ison, Accident Compensation (1980), pp.18-32; see also note 3 above, pp.327-329.

6. The Commission has received a request that priority be given to the establishment of a no-fault scheme for certain aspects of medical misadventure: letter from the Deputy Premier and Ministry for Health, the Hon. R J Mulock, MP, dated 17 August 1984.

7. The Minister for Territories and Local Governments has announced that the Commonwealth Government has agreed in principle for a no-fault transport accident compensation scheme for the Australian Capital Territory. The Minister stated the he was “particularly interested” in the proposal being developed by this Commission: the Hon. T Uren, MP, media statement, 18 June 1984.

8. G W R Palmer, Compensation for Incapacity (1979), appendix I.