Official Statistics

Background quality report: MOD Common Law Compensation Claims statistics 2019/20

Published 10 December 2020

1. Introduction

Overview

The Ministry of Defence (MOD) common law compensation claims report is released on an annual basis as Official Statistics, providing statistics on common law compensation claims against the MOD (other than those arising out of contract disputes), including the number of new claims brought, the number of claims settled and the in-year-expenditure on claims. The claims are dealt with by the Directorate of Judicial Engagement Policy – Common Law Claims & Policy (DJEP-CLCP), or by MOD’s claims handling agents operating in accordance with instructions provided by DJEP-CLCP. The majority of compensation claims received by the MOD relate to injury to employees and third party motor incidents involving MOD operated vehicles and these are managed by MOD’s contracted claims handlers. The categories of claim currently managed in-house include sensitive employer’s liability claims, public liability, clinical negligence, military low flying, maritime and third party motor collisions. These statistics do not include compensation awarded under the MOD’s no fault schemes, the Armed Forces Compensation Scheme and its predecessor the War Pension Scheme.

Background and Context

The MOD Compensation claims statistics reports have been published annually from FY2014/15. Prior to this statistics on claims brought against the MOD were published in two places:

• Claims Annual Report: Published internally but with virtually no external distribution other than to a small number of MOD’s business partners. However, the Claims Annual Report is provided externally if requested under the Freedom of Information Act. The statistics in this Report were not considered to be official statistics.

• UK Defence Statistics Compendium and the Tri-Service Personnel Bulletin: Both publications included two tables of Claims statistics on ‘New claims and settled claims by broad category’ and ‘New claims and settled claims by broad cause’. The statistics contained in these publications were considered to be official statistics.

Methodology and Production These statistics are primarily counts of the number of claims brought and settled claims in a given financial year broken down by type of claim (Public Liability (including third party motor claims), Employer’s Liability – Service, Employer’s Liability – Civilian, Clinical Negligence, and Other (Area Claims Offices and Defence Infrastructure Organisation)) as well as the category of the claim. The nature of the claims received changes over time and this is reflected by incorporating information on the highest claims categories or those for which there is particular interest. Data is also provided for the in-year expenditure on claims by category which contains a high level summary of the payments made on claims in the financial year.

Data is collated from a number of difference sources: DJEP-CLCP’s Claims handling information payment system (CHIPS) is used for claims managed in-house. This is a database for which information can be queried and extracted. Claims handlers keep CHIPS up-to-date so the data should be accurate. MOD’s contracted claims handlers Gallagher Bassett International Ltd and Topmark Claims Management Ltd provide the information on the claims for which they are responsible. Gallagher Bassett on claims received from 1 May 2007 to 30 April 2016 and Topmark on claims received from 1 May 2016. Financial information provided by the contracted claims handlers is checked against information held by Head Office – Corporate Services (HOCS) Finance to ensure consistency. There can sometimes be a change in definition due to different ways contractors collate their data. For example, from FY16/17, the way third party motor claims were recorded changed with MODs new contractor now recording each claim as a motor incident which may have one or more claimants with an injury and/or a property damage claim whereas previously each claim was treated separately. Similarly, cadet claims are now recorded as Civilians whereas previously they had been included under Service.

2. Relevance

The principal customers for MOD compensation claims statistics are internal; however, the statistics are often used to answer queries from journalists and Freedom of Information requests, reflecting a degree of external interest in the subject. The primary rationale for producing the claims statistics is to ensure that there is a publicly available record of this very substantial category of public expenditure. It also serves to heighten awareness in all areas of the Department of the importance of sound risk management, in the expectation that this may reduce the number of incidents giving rise to claims. The central claims budget was disaggregated to TLB holders on 1 April 2017 as an incentive to reduce the overall cost of claims. DJEP-CLCP continue to provide a claims management function on behalf of the TLBs and Front Line Commands and have developed MI to provide the respective areas with visibility of their claims to support risk management processes. Close TLB engagement continues enabling more detailed scrutiny of claims.

3. Accuracy

Data is supplied by MODs contracted claims handlers for the claims managed externally. DJEP-CLCP is reliant that the contractors are recording claims correctly and that they run data cleansing exercises regularly to ensure accuracy. DJEP-CLCP can ensure the accuracy of internal claims by keeping CHIPS up to date.

Number of claims brought

All claims are recorded on CHIPS or equivalent systems used by MOD’s contracted claims handlers and it can therefore be assumed that the overall number of claims should be accurate. There is a possibility that cases transferred between the MOD and its contractors (not more than 0.5% of the total) could be double counted. Efforts are being made to prevent this. The report does not include any claims that are reopened.

Number of claims settled

It is possible that the same claim may be shown as settled in more than one financial year within the published figures. This can occur in claims that are reopened. It can also occur in cases where a late payment is made. This can be as a result of late contact from the Compensation Recovery Unit (CRU) in relation to outstanding charges/ outstanding fees after the claim has been closed. The contractors overwrite the claims closed date with the late payment date. Efforts are being made to identify such cases and minimise any claims appearing in more than one financial year.

Prior to FY19/20 it is possible that the overseas Area Claim Offices have included claims repudiated/ discontinuations as settled claims which would usually be excluded.

Expenditure

The payment data is extracted from the CHIPS system and supplied by MODs contractors. It is checked against information on costs held by HOCS Finance for consistency, although there can be timing issues in relation to payments made.

As the report is based on snapshot data taken at the end of the Financial Year, statistics may not match data provided in response to Freedom of Information requests which are compiled from live data which is continually updated and cleansed by MOD contractors. For this reason, only major revisions to data will be updated and revised in the next publication.

4. Timeliness and Punctuality

The release date for this publication was pre-announced on the MOD’s Calendar of Upcoming Releases section of GOV.UK

5. Accessibility and Clarity The publication can be accessed on the MOD Compensation Claims collection page In order to assist the reader, the publication contains a key points section which draws out the main findings. Information is provided in the tables, including footnotes, to aid interpretation of the data.

6. Coherence and Comparability The GOV.UK statistics on MOD compensation claims are the definitive claims statistics. The tables in the 2019/20 publication contain data spanning a five year period allowing for direct comparability against previous years’ data.

7. References

Statistics at MOD Homepage

MOD’s Timetable of Future Releases of National and Official Statistics

8. Contact Details

Please contact SPODJEP-ClaimsGeneral@mod.gov.uk if you have any queries about the publication.

Glossary

Compensation Recovery Unit (CRU) is part of the Department for Works and Pensions (DWP) and recovers social security benefits in certain compensation cases and NHS costs in certain injury cases.

Last updated: December 2020