In brief - Educational and other institutions may wish to consider merit of entering a participating group and should seek legal advice 

The National Redress Scheme for Institutional Child Sexual Abuse Act 2018 (Cth) (Act) came into force on 1 July 2018, and establishes a scheme to provide compensation to survivors of past institutional child sexual abuse (affected person).
 
If the operator of the scheme considers there is a reasonable likelihood that the affected person is eligible for redress, then they must approve their application and make an offer of redress. The operator also determines which institutions are responsible for the abuse.
 
Institutions that are responsible for the abuse under the scheme will ultimately be liable for the costs of providing redress to the affected person. The institutions must also contribute to the costs of the administration of the scheme, by making funding contributions on a quarterly basis.

Participating Institutions and Groups covered by the Scheme

Institutions covered by the scheme are defined as "participating institutions" in the Act, and are those institutions that agree to join the scheme and that the Minister declares to be participating. The Act provides the opportunity for these institutions to form a "participating group", which is a group of participating institutions represented by a specific "representative". The representative may act on behalf of each member of the group, for example in communicating with the operator of the scheme.
 
Individual institutions can take comfort in the fact that there is nothing in the Act making them responsible for the redress payments required to be paid by any other participating institutions in the same participating group.
 
Further, if an affected person accepts an offer of redress, they release the responsible institution from liability, as well as the other institutions in its participating group.

Redress Payments and Financial Contributions of Participating Institutions

The Commonwealth will bear the initial costs of making redress payments to the affected person, as well as any payments for counselling or psychological services under the scheme.
 
Participating institutions are therefore liable to reimburse the Commonwealth for their share of these costs, via funding contributions paid on a quarterly basis.
 
Under the scheme, a participating institution is required to pay funding contributions made up of:
  1. the redress element, covering the total amount of the institution's liability for redress payments, counselling and psychological support payments, and
  2. the scheme administration element
The operator of the scheme determines the amount of funding contribution that an institution must pay for the quarter.

Advice on merits of entering into a participating group

We have recently advised educational institutions on the merits of entering into a participating group, by becoming a member of a company incorporated to be the representative of the group (all affiliated to a religious denomination).
 
Our advice focussed on reviewing the proposed Constitutions of the representative companies, in order to understand what rights and obligations our clients would have if they agreed to join the participating group by becoming a member of the relevant company. The preparation of our advice required great familiarity with the Act as we needed to ensure that the proposed Constitutions were compatible with the Act.

Seek legal advice to understand the National Redress Scheme and how it applies to your particular circumstances

It is apparent that the National Redress Scheme is being seen as a viable alternative to the negotiation of claims though the courts. The National Redress Scheme website states that "Many institutions have already agreed to join the Scheme. This includes the Commonwealth, and all state and territory governments and many of the major churches and charities, including the Catholic Church, the Anglican Church, the Uniting Church, the Salvation Army, the YMCA and Scouts Australia."
 
Also, Trinity Grammar in Melbourne has stated that it will join the National Redress Scheme after it paid $500,000 to a former student.
 
Educational and other institutions that are interested in understanding the National Redress Scheme and its application to their particular circumstances should seek legal advice.

This is commentary published by Colin Biggers & Paisley for general information purposes only. This should not be relied on as specific advice. You should seek your own legal and other advice for any question, or for any specific situation or proposal, before making any final decision. The content also is subject to change. A person listed may not be admitted as a lawyer in all States and Territories. © Colin Biggers & Paisley, Australia 2019.

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