Draft Compensation Act 2006

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Mr. Kilfoyle: I am mindful of your admonition, Mr. Wilshire, to keep to the point, and I shall do my best. I am sure that you will remind me if I do not.
I state an interest as a patron of the Merseyside asbestos victims support group. In that capacity, I approached my hon. Friend the Member for Barnsley, West and Penistone to set up an asbestos sub-group of his all-party group on occupational safety and health, and it has been effective in lobbying on issues such as this one. Credit should be given to him for his endeavours, and to John Flanagan in my area, who has researched the issue assiduously with help from Laurie Kazan in Canada and Matt Peacock in Australia. This is a worldwide problem.
Hon. Members alluded to my concerns about the Navy. Frankly, those have little to do with my time in the Ministry of Defence, but have a lot to do with my brother John. I got him a job in which he handled asbestos, and mesothelioma killed him. I remember well the trauma of trying to get compensation for his family. Any measure that makes it easier for victims to get some kind of compensation—this is one such measure—is not only to be welcomed but applauded.
I see people on a regular basis in the support group who know that they will die before their dependants receive anything. They leave wives, and often children. The disease does not afflict only old men, as some people think. It afflicts women and, increasingly, younger people who have picked up asbestos in places such as Turner and Newell in the constituency of my hon. Friend the Member for Houghton and Washington, East.
I applaud and congratulate the Government on the measure and pledge my complete and full support.
Mr. Fraser Kemp (Houghton and Washington, East) (Lab): My hon. Friend mentioned Turner and Newell, which is in my constituency. It was previously known as the Washington Chemical Works. That huge company was closed down a few years ago. It employed hundreds of people and made nothing but asbestos products.
As my hon. Friend said, the effect was considerable, not just for those who worked at the company. For instance, my aunt contracted the disease simply because my grandmother washed my grandfather’s overalls in the washing machine. Does he agree that the impact is felt not just by the workers but by people far wider?
Mr. Kilfoyle: My hon. Friend is absolutely right. The disease has a widespread and devastating impact.
On the question of the armed forces—
The Chairman: Order. I think that I have allowed the hon. Gentleman as much time out of order as I allowed Mr. Breed, so I would be grateful if we could now leave the Navy behind and get back to the regulations.
Mr. Kilfoyle: I am now intrigued as to how I can raise my question. I presume that I should do that with the Minister outside the debate on this statutory instrument.
4.54 pm
Ed Balls: I repeat my assurance to my hon. Friend that I have heard the tenor of his remarks. I have listened to the remarks on the MOD mad by the hon. Members for South-East Cornwall and for Fareham, and I make a commitment to my hon. Friend that I will write to him and fully set out the position as I, as a Treasury Minister, understand it. I will send a copy to the appropriate MOD Minister and ensure that other members of the Committee receive a copy as well. It may help to further discussions in future weeks.
I am grateful to my hon. Friend for making his point, and I thank him and other hon. Members for their more general work on the matter. It is only through such continual pressure and detailed campaigning that asbestosis and vibration white finger, which affect many thousands in mining areas, will remain at the forefront of our attention.
Chris Bryant (Rhondda) (Lab): My hon. Friend the Member for Liverpool, Walton spoke about the speed with which we need to make progress. It needs to be understood that, for the vast majority of those who suffer from mesothelioma, there will be no more than 18 months between the moment of diagnosis and death. That is why it is so important that the Government have moved forward.
Ed Balls: I understand that. We are dealing with an unusual situation; once the diagnosis is made, the disease can come on very fast, which is why it is important that compensation is dealt with as quickly as possible. However, the effects of the disease can take a very long time to occur, so there can be a long gap between the onset of the disease and the original exposure.
We often have problems if an employer or an insurance company becomes insolvent. We therefore need a compensation scheme that will allow us to go back over the years in order to work out the liabilities and to ensure that they are properly apportioned.Our problem, post Barker, was that full detailed apportionment would be needed before payment could be made. We are dealing with that in the 2006 Act and the regulations.
I know that in recent years hon. Members have seen a substantial change in the pace at which compensation payments are made. That is why there was so much concern about the Barker judgment. We have acted quickly and with some haste. Indeed, consultation on the regulations was considerably shorter than usual, but we wanted to ensure that we got things back on track as soon as possible.
I have dealt with the MOD issue. I was also asked about the potential costs. We are not changing the fundamentals of the liability regime: we are changing the process. We hope that it will change the timing of payments rather than their substance. We do not think that the impact will be significant. We do not have detailed information about the likely change in the flow of cases that will enable us to estimate the timing of the various payments.
As the hon. Member for Fareham said, the FSAis reviewing more broadly the funding of the compensation scheme. That review is unrelated to this matter, although it will clearly have a bearing on it. The kind of payments that we are talking about can be accommodated within the scheme, as can changes in timing. Although I cannot answer the question precisely—we do not have the information—I assure him that we will be able to deal with the financial consequences of the regulations.
Whether or not the state is the employer, it is society’s responsibility to ensure that compensation schemes are properly in place. In the case of white finger, the cost to the state now runs into billions of pounds; it is close to £5 billion. That money has been found—it is right and proper that it should be—and we will ensure that the compensation scheme is ready to step in whenever an employer or insurance company becomes insolvent.
The average claim for mesothelioma is about £100,000. There are more than 1,800 cases a year and it is estimated that that figure may rise to about 2,400 a year by the beginning of the next decade. We will continue to pay compensation in a substantial number of cases—there will be hundreds of them—through to the middle of this century. It is a serious problem, and it will be with us for decades to come. We need to ensure that we have the proper procedures in place so that when a diagnosis is made we can go back over the years and decades to ensure that liability is properly assessed. We also need to ensure that the payments go to the victims as speedily as possible. I believe that the regulations will achieve that, and I commend them to the Committee.
Question put and agreed to.
That the Committee has considered the draft Compensation Act 2006 (Contribution for Mesothelioma Claims) Regulations 2006.
Committee rose at Five o'clock.
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Prepared 5 December 2006