Key facts
- Taxpayers may be liable for up to $65 million in payouts to child abuse survivors.
- The Christian Brothers, a Catholic order, has informed a court it is facing bankruptcy.
- There are 340 current redress claims against the order, estimated at $25 million, with 590 future claims projected at $40 million.
- The federal government acts as a "funder of last resort" when institutions cannot pay.
- The Christian Brothers' proposed property sales are unlikely to cover the full amount owed to survivors.
- Allegations exist of asset transfers to a separate entity, the Trustees of Edmund Rice Education Australia, for nominal amounts.
Australian taxpayers may be compelled to pay up to $65 million to survivors of abuse if the Christian Brothers, a Catholic order with a history of child abuse, declares bankruptcy. New court documents reveal the order's financial distress, indicating it cannot afford to settle the hundreds of claims against it.
An actuarial report indicates 340 current redress claims are expected to cost $25 million, with an additional 590 future claims anticipated to cost $40 million. Under the National Redress Scheme, the federal government serves as a "funder of last resort," meaning it must cover costs when an institution is unable to pay.
Social Services Minister Tanya Plibersek stated that victim-survivors deserve accountability and that the Christian Brothers should take responsibility. She assured that the government would ensure the integrity of the redress scheme and is participating in Supreme Court proceedings to protect the interests of survivors and taxpayers.
The Christian Brothers' proposed plan involves selling its remaining 36 properties, but the proceeds are expected to be insufficient to cover the claims. Survivors and their legal representatives are reportedly angered by allegations that the order transferred significant property holdings to the Trustees of Edmund Rice Education Australia for nominal sums over the past decade.
Further complicating matters, court documents show that the Brothers of the Christian Schools of Ireland holds assets valued at $47 million as of May this year, which are currently beyond the reach of creditors. The Christian Brothers is attempting to incorporate these assets into its proposed scheme to increase available funds.
Plibersek has previously expressed serious concerns about the Christian Brothers' financial restructuring and the potential for a lack of accountability for the abuse, emphasizing that victims and survivors find the idea of no one being held responsible devastating.