Huge Tasmanian state budget hit as sexual abuse victim payouts expected to soar

Tasmania will spend a huge amount compensating the victim-survivors of abuse in government institutions – and in the process blow a massive hole in the state budget.

Treasurer Michael Ferguson with Premier Jeremy Rockliff. Picture: Nikki Davis-Jones

Tasmania will spend up to $600m – and run up a record billion-dollar plus budget deficit – compensating the victim-survivors of abuse in government institutions.

The Mercury understands next week’s Preliminary Outcomes Report for the 2023-24 financial year will contain a massively increased estimate for payouts and associated costs.

The government earlier this year set aside an additional $240m over three years for implementing its response to the Commission of Inquiry into the Tasmanian Government’s Responses to Child Sexual Abuse in Institutional Settings.

“Costs associated with claims against the state by survivors of institutional child sexual abuse are … expected to be material in the current budget context,” budget documents noted.

But the Preliminary Outcomes Report will for the first time recognise the allowance for legal claims related to historical child sexual abuse in state care over the past four decades is now expected to be another $600m.

Commission of Inquiry, The Honourable Robert Benjamin AM SC, The Honourable Marcia Neave AO (Commission President) and Professor Leah Bromfield. Picture: Chris Kidd

The Treasury report is due to by August 15 and will confirm revised figures for a record deficit for the past financial year reflecting the mounting legal claims.

Next month’s state budget will reflect a deteriorating eocnomic and fiscal outlook, with some predicting state service job cuts as part of broad austerity measures.

The March Quarterly Report put the likely 2023/24 budget deficit at $582m.

The revised estimate follows the $75m settlement payment agreed by the State of Tasmania as part of the Ashley Youth Detention Centre class action, which included claims stretching back decades.

The Commission of Inquiry report.

Other claims have been brought by victim-survivors who did not sign up to the class action or who suffered abuse at other institutions.

Treasurer Michael Ferguson last week said that the government had always been up front about the budgetary impact that the recommendations stemming from the Commission of Inquiry will have.

“It will hurt the budget, and this will be expensive, but we will need to do it,” Treasurer Ferguson said.

“Any funds paid to implement the recommendations will be spent to keep kids safe, have restorative practices within our departments, and provide justice to those who deserve it. “

Mr Ferguson said despite the cost the government has committed to righting the wrongs of the past 40 years.

“I am prepared to cop any and all criticism that results from doing the right thing in our budget responses”.

Commissioner Marcia Neave with Tasmanian Governor Barbara Baker. Commissioners the Honourable Marcia Neave AO, President and the Honourable Robert Benjamin AM SC and Professor Leah Bromfield handing the report to the Governor Barbara Baker in relation to the Commission of Inquiry. Picture: Nikki Davis-Jones

The Commission of Inquiry into the Tasmanian Government’s Responses to Child Sexual Abuse in Institutional Settings released its final report in September last year.

Titled “Who was looking after me? Prioritising the safety of Tasmanian children,” the 3,000 page report contained 75 findings and 191 recommendations.

The government has accepted all of the recommendations and 21 per cent have been completed as part of a three-phase implementation plan extending to 2029.

It was revealed in parliament this week that 17 workers from the Ashley Youth Detention Centre are suspended after being accused of child sexual abuse.

The scandal-plagued centre is slated for closure.