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Public Bill Committee Debates

Draft Pneumoconiosis etc. (Workers’ Compensation) (Payment of Claims) (Amendment) Regulations 2007

The Committee consisted of the following Members:

Chairman: Mr. David Wilshire
Alexander, Danny (Inverness, Nairn, Badenoch and Strathspey) (LD)
Battle, John (Leeds, West) (Lab)
Campbell, Mr. Ronnie (Blyth Valley) (Lab)
Ennis, Jeff (Barnsley, East and Mexborough) (Lab)
Gummer, Mr. John (Suffolk, Coastal) (Con)
Heppell, Mr. John (Vice-Chamberlain of Her Majesty's Household)
Keeley, Barbara (Worsley) (Lab)
Kemp, Mr. Fraser (Houghton and Washington, East) (Lab)
Lancaster, Mr. Mark (North-East Milton Keynes) (Con)
Laws, Mr. David (Yeovil) (LD)
Murphy, Mr. Jim (Minister for Employment and Welfare Reform)
Neill, Robert (Bromley and Chislehurst) (Con)
Penrose, John (Weston-super-Mare) (Con)
Prosser, Gwyn (Dover) (Lab)
Selous, Andrew (South-West Bedfordshire) (Con)
Skinner, Mr. Dennis (Bolsover) (Lab)
Strang, Dr. Gavin (Edinburgh, East) (Lab)
Hannah Weston, Committee Clerk
† attended the Committee

Third Delegated Legislation Committee

Thursday 22 February 2007

[Mr. David Wilshire in the Chair]

Draft Pneumoconiosis etc. (Workers’ Compensation) (Payment of Claims) (Amendment) Regulations 2007

8.55 am
The Minister for Employment and Welfare Reform (Mr. Jim Murphy): I beg to move,
That the Committee has considered the draft Pneumoconiosis etc. (Workers’ Compensation) (Payment of Claims) (Amendment) Regulations 2007.
Good morning to you, Mr. Wilshire, and to members of the Committee. I am delighted to serve under your chairmanship. This is the closest proximity in which we have been since we both served in the armed forces parliamentary scheme, which was one of the most enjoyable events in my nine or so years in Parliament, and not simply because it involved throwing you off HMS Newcastle into the Caribbean—
The Chairman: The trouble is that I got back on.
Mr. Murphy: That was not my fault.
I confirm that the provisions of the regulations are compatible with the European convention on human rights. They are being made under the Pneumoconiosis etc. (Workers' Compensation) Act 1979, which was designed to pay compensation to sufferers from certain dust-related diseases when there is no recourse to legal action against their former employers. The purpose of the regulations is to increase by 3.6 per cent. the amount of compensation paid to those who first satisfy all qualifying conditions on or after 1 April 2007. The increase is based on the retail prices index, which is the indicator for increasing most social security benefits, at September 2006.
The 1979 Act has been administered by the Department for Work and Pensions since responsibility was transferred from the Department for Transport in 2002. Following the transfer, the Government gave a commitment to increase the payments annually alongside increases to other social security benefits. I am pleased to keep that promise by bringing forward these regulations.
It may help if I mention briefly the history and purpose of the Act. People suffering from industrial diseases have the right to sue their employer or employers at whose workplace exposure took place. However, the dust-related diseases covered by the Act take a long time to develop, as my hon. Friends are only too aware from cases in their constituencies, and might not be diagnosed until 20, 40 or even more than 60 years after exposure to dust. By that time, not surprisingly, the employer or employers responsible may no longer exist, which means that sufferers and their dependants might find it difficult, if not impossible, to secure compensation through civil action.
To give a simple example, the use of asbestos was widespread in shipyards, and many of the asbestos-related diseases that now exist were caused by exposure in the 1960s. Many of the shipbuilding and ship-repairing companies that traded then are no longer in business and people who have a disease caused by working for them are unable to pursue a claim for damages. To remedy that, Parliament enacted the 1979 Act to provide a measure of compensation to those who cannot claim through the courts. It provides for lump-sum payments to sufferers from certain industrial-related diseases or, if the sufferers have died, to their dependants.
There are three basic conditions of entitlement that must be satisfied before a payment can be made: first, that every relevant employer has ceased to carry on business; secondly, that no court action has been brought nor compensation received in respect of the disease and, finally, that industrial injuries disablement benefit is payable to the disabled person. The Act covers five main diseases: diffuse mesothelioma; pneumoconiosis, which of course includes asbestosis; bilateral diffuse pleural thickening; primary carcinoma of the lung where there is evidence of asbestosis and/or bilateral diffuse pleural thickening, and byssinosis.
The vast majority of claims under the scheme, in fact more than 70 per cent., are for mesothelioma, which is, as my hon. Friends know, a particularly unpleasant, terminal condition caused by asbestos fibres. In a moment I shall mention ongoing work to improve support for sufferers. I am glad to record that the scheme has successfully fulfilled its role, which is best illustrated by giving figures that show how much it has helped those most in need.
From the time the 1979 Act came into force until January 2007, more than 16,490 claims have been received. Of that number, 10,874 people have been paid, resulting in payments totalling £183 million. In the current financial year to January 2007, we have made 1,582 payments to individuals, amounting to £21 million, in compensation under the Act; 87 per cent. of claims made under the Act are successful. Following the increase set out in this order, the maximum amount payable—that for a person aged 37 or under with 100 per cent. assessment—is £67,890, but such large payments are seldom made. On average, sufferers receive about £14,000 and dependants £6,000.
The number of people successfully claiming under the scheme is a reflection of the number who suffer and of its success. I am very pleased with the major contribution that it makes to the support provided for people suffering from those distressing diseases. Lump sums paid under the Act are made in addition to weekly payments under the industrial injuries disablement benefit scheme. Together, they form a significant package of financial assistance for people suffering from mesothelioma and other diseases covered by the Act.
I am looking forward to seeing the replies of all stakeholders, including the Industrial Injuries Advisory Council, which has been fully involved in both reviews. We particularly value its input. A mesothelioma consultation exercise took place at the end of 2006, and a mesothelioma summit is planned for 13 March, when a wide variety of stakeholders will discuss options for future action. I look forward to hearing the proposals that arise from that event. Hon. Members are welcome to offer observations as part of both those consultations.
To conclude, we all recognise that each case is a disaster, not only for the individual who suffers from one of the diseases but for members of that person’s family. The Government are committed to maintaining the value of the compensation that people receive through the scheme. It cannot ever come close to compensating families for the loss of a life or for severe ill health, but it does provide financial help at a time of crisis for sufferers and their families.
9.4 am
Andrew Selous (South-West Bedfordshire) (Con): Thank you, Mr Wilshire. We were briefly together in the Whips Office, and it is a pleasure to serve under your chairmanship again this morning.
The official Opposition welcome the order. As the Minister has said, it increases lump sums by about 3.6 per cent., in line with other social security benefits that were uprated a few days ago on the Floor of the House. Last year, the increase was only 2.7 per cent. but it is higher this year because the retail prices index is higher.
I congratulate the Minister on bringing out the industrial injuries disablement benefit consultation paper, which includes the Act under which the order is made. Looking at the record of debates on this matter, I see that the Minister’s predecessors in both the past two years said that they would produce a consultation paper. This Minister has done so.
My hon. Friend the Member for Daventry (Mr. Boswell) dealt with the relevant order last year and the year before that. He hoped that the consultation would have three outcomes. First, he hoped that it would produce equity among sufferers, so that the amount of compensation from the different schemes was equivalent to the level of suffering, and that is absolutely right. Secondly, he hoped that the administrative costs of paying out the money would be the lowest possible, which is something we all like to see—I know that the hon. Member for Bolsover made that point last year. Thirdly, my hon. Friend hoped that the new system would be simpler and easier for claimants, who are often in great personal distress when they have to approach such schemes, and also for dependants, when there has sadly been a bereavement from either pneumoconiosis, mesothelioma or any of the other three diseases that the Minister mentioned.
Sadly, the problem will get more serious over the next three years. The figures are as follows: in 1968, there were 153 deaths from mesothelioma and the numbers rose to 1,631 in 2000 and to 1,874 in 2003. I understand that the Department expects the number of deaths to peak between 2011 and 2015 at a figure somewhere between 2,000 and 2,500. I would be grateful if the Minister could confirm that that is still the Department’s expectation.
I would like to put six questions to the Minister; he grimaces a little, but I am sure that his able officials will be able to help him if he does not have the answers to hand despite his extensive preparation for the order. First, I understand that last year, 2005-06, just under £25 million was paid out and that the Department has allocated total funding for the scheme of £37 million this year. In the unlikely event that the total number of claims were to exceed that £37 million, would additional claimants not be paid, or would the Department find the extra funds that would be necessary?
Secondly, I would be grateful if the Minister would explain the easement that will be introduced in the Welfare Reform Bill, which relates to the condition that every relevant employer must have ceased to carry on business before compensation can be claimed. We can all imagine a situation in which an employer continued to exist in some legal form, yet was unable to make a payment. However, none of us on the Committee wants sufferers to be unable to claim, so it seems that the provision in the Bill will be welcome, but I would be grateful if the Minister could explain exactly what it entails.
I was pleased that the Minister touched on my third point in his opening remarks. We all understand that the assumption behind both the 1979 Act and the order is that people whose employers are still in business will be compensated, and it is absolutely right that they should be—I am sure we all support that. However, it would be useful for the Committee if the Minister could tell us how quickly that process of compensation is happening in practice. It will be deeply unfair if people whose employers have gone out of business have access to a fast and fairly sure remedy under the state scheme, while those whose employers are still in existence may have to wait years; as we all know, justice delayed is, in effect, justice denied, particularly when people are suffering from terminal illnesses.
The consultation that the Minister brought out on 29 January referred a little to the balance of rights and responsibilities. Can he clarify whether in future years the payments will still be regarded as compensation—albeit compensation that, of course, can never adequately compensate for the damage to health and the foreshortening of life—or will they be regarded in some way as rehabilitation measures? I fully accept that those who are compensated deserve to be rehabilitated, but will the compensation to be paid be contingent on rehabilitation, or will the rehabilitation be additional to the compensation that will, quite rightly, be paid under the Act?
Last year a member of the equivalent Committee mentioned wives who may have contracted asbestosis from washing their husbands’ overalls—normally, it was in that order, with far more men suffering than women. Children, too, could have suffered; a constituent who visited my surgery recently told me that her mother used to wash her father’s overalls in the bath. My constituent and her siblings would then use the same bath. People in the immediate environment can also be affected; for example, those next to an asbestos factory. That point is mentioned briefly in paragraph 4.14 of the consultation paper. I should be grateful if the Minister could tell us whether he intends to expand the scope of eligibility under the scheme.
Finally, the Minister’s predecessor made the point, at column 10 of the Official Report of the Statutory Instrument Committee on the equivalent order last year, that much of the £800 million paid out under both the industrial injuries disablement benefit scheme and the 1979 Act went to lawyers. I am not sure what the right hon. Lady meant by that. My understanding was that lawyers’ fees would be paid by the employers who were still in existence when their former employees went to court for compensation. I should be grateful if the Minister could clarify that point. We support the uprating and are pleased to see it come before the House.
9.11 am
Mr. David Laws (Yeovil) (LD): Thank you, Mr. Wilshire. I welcome you to the Chair and thank the Minister for his introduction to the regulations. We also support the regulations, which are not among the more controversial that we debate. The explanatory memorandum that helpfully goes with the regulations has a section entitled “Matters of special interest to the Joint Committee on Statutory Instruments”, which, with admirable brevity, contains the single word “None”. In some ways that reflects my feeling about the controversies surrounding the regulations.
Nevertheless, the regulations relate to the important issue of compensation for individuals who have experienced the medical conditions that the Minister has described. I commend the hon. Member for South-West Bedfordshire on squeezing six questions out of this rather thin gruel. I have only three, which will make the Minister’s life a bit easier. My first question is a rather obvious one: why is it necessary for us to keep on meeting every year to discuss this, when hon. Members could be using their time valuably elsewhere? There are also the excellent officials who have been derailed from other activities, the Hansard reporters and, of course, you, Mr. Wilshire.
The explanatory memorandum, which I always look at before considering regulations, states:
“There is no statutory obligation to increase payments in line with inflation under the Act. However, previous Governments have given an undertaking to Parliament to regularly review the rates of payment in order to maintain their value broadly in line with inflation”—
whatever that means. It continues:
“This review is normally conducted annually using the Retail Price Index: the same indicator of inflation for social security benefits.”
Obviously, those arrangements reflect the proposals in the original 1979 Act, which came into force some time ago. One wonders whether at some stage the Government will take the opportunity to tidy this up and save a huge amount of time. Later today, we will discuss the cost of pensions compensation, and the Government intend to add up 50 years of compensation and discount it back to today. If we were to add up the costs of dealing with this regulation for many years into the future, we might discover that it was worth our while getting rid of these annual debates.
It was interesting that at the end of his comments the Minister said that the Government are committed to maintaining the value of these payments. That appears to put on the record that although there is discretion in the 1979 Act, the Government’s policy is always to uprate the payments at the value of the RPI. That relates to my second question: are there any circumstances in which we would not want to uprate these benefits? I cannot think of any reason why the Government would not want to uprate them by the RPI, but perhaps a future Government might do so. Who knows?
However unlikely it is that a Government would not wish to uprate these payments by inflation, would it not be better just to be done with these wretched debates and uncertainty and put the uprating on the face of the legislation? In an average year in which the Government succeed in hitting their inflation targets, we are talking about a cost for the inflation uprating based on the figures that the Minister has given us today of about £750,000 a year, which will hardly break the bank. I would have thought that we could save time and avoid future uncertainty by taking the opportunity to include RPI uprating in the Bill.
The Minister has indicated that people’s success in claiming the money under the provisions is quite high—I think that he said that 87 per cent. of claimants were successful in the most recent year. There has been some concern about the impact of delays on claimants. Does he have any information about the time lags between claims being submitted and being accepted? Are there hold-ups, or are the claims dealt with quite successfully?
The Minister helpfully gave us some updated information about the cost of the measure and the number of people involved, which is not in the Library note. He charged through it at such speed, however, that he sounded like the Chancellor of the Exchequer reading out undesirable Budget numbers so quickly that nobody can note them down. The Minister moved beyond my powers of annotation, but I think that he gave a figure of £21 million for the most recent year with 1,582 claims. I am trying to work out how those figures relate to those mentioned by the hon. Member for South-West Bedfordshire, who talked about £35 million for the past year and £37 million for this year. Will the Minister give us the total number of fresh claims each year, the total number of outstanding claims and the total expenditure for the past few years and perhaps for next year? If he does not have those figures now, will he send us a note containing them? I could not tally the figures that he gave with those in the Library note. Otherwise, however, we welcome these uncontroversial regulations.
9.17 am
Jeff Ennis (Barnsley, East and Mexborough) (Lab): It is a pleasure to serve under your chairmanship, Mr. Wilshire. I am delighted to rise in support of uprating the compensation payments.
I do not want to detain the Committee for too long, but I would like to put a personal perspective on the meaning of these regulations for the lives of certain families. My granddad, Oliver Ennis, suffered from pneumoconiosis and had to retire from Grimethorpe colliery at the age of 42, although he lived until his mid-70s. Pneumoconiosis does not kill individuals, but it ruins their lives—it is known as “lingering death” in mining constituencies such as the one that I represent. The Government have done a fantastic job in compensating people for that type of injury. For example, my constituency is now a former mining constituency, but before Christmas we broke the £100 million mark for compensation payments for chronic bronchitis, emphysema and vibration white finger, which is staggering. That is a tribute to the present Government, as is the scheme that we are discussing.
I remember going to my granddad’s house in Grimethorpe. He had an oxygen cylinder at the side of his chair when he was watching television and one at the side of his bed. His quality of life was limited to going to the Coal Industry Social Welfare Organisation centre in Pontefract once a week, when the bus came to pick him up. The story has an added twist which provides a personal perspective. He was one of the first claimants under the original scheme, which I think at that time paid about £1,000 for every 10 per cent of the condition. He had suffered from the age of 42 with 100 per cent. pneumoconiosis, but he received a cheque for £9,000. Obviously, he should have received £10,000, so he took up the issue with the secretary of the National Union of Mineworkers, a gentleman called Arthur Scargill, whom some people in the Room might remember. Mr. Scargill took up my granddad’s claim, and within four to six weeks my granddad received a cheque for £10,000, not for the £1,000 that he should have received to top up his original payment. Obviously, the Department thought that it was a claim for 100 per cent. pneumoconiosis. If my granddad had cashed that cheque, he would probably have got away with it. Being a miner and an honest type of guy, however, he sent back the cheque and said, “I am not entitled to £10,000. I am entitled to an additional £1,000.” So he was sent another cheque for £1,000.
I told that tale because it underlines the honesty of miners and working people in this country. I have been joined in Committee by hon. Friends who also represent mining constituencies. Miners do not want a penny more than they are entitled to; they want only their just desserts under the law. As I have said, I am very proud to represent a mining constituency and of my family history, and I therefore support the regulations and the uprating of the scheme.
9.21 am
Mr. Dennis Skinner (Bolsover) (Lab): I rise briefly to comment on the remarks that have been made, and, in particular, on those made by my hon. Friend the Member for Barnsley, East and Mexborough about Barnsley. I was a Member of Parliament when we introduced the relevant orders—this is not the only one—and those were very important decisions.
In light of the current claims involving chronic obstructive pulmonary disease, to which my hon. Friend has referred, the tragedy is that the courts, not the Government, took a decision on bronchitis and emphysema cases based on the instant gratification of those involved, as is the way in society nowadays—“We want it now and for ourselves”—whereas the pneumoconiosis settlements between 1974 and 1979 were based on something much more sensible. I am speaking in order to send a message to the courts and judges that it is time that they understood that there is another way besides the instant gratification of victims and lawyers.
Lawyers were referred to earlier. Under the scheme before us, the amount of money going to lawyers—fly-by-night or otherwise—is very small compared with what happens in COPD and vibration white finger cases today, which is principally the result of Justice Turner saying, when he decided on COPD cases, that everybody could have their own little share, so everybody finished up with their own solicitor. It is a tragedy!
We are witnessing today something that was accepted as sensible in the past. To each area—Yorkshire, Derbyshire, Lancashire and all the rest—the NUM and other associated unions could say, “We will get together and ensure that we come to a collective agreement”. Back then, there was no Union of Democratic Mineworkers or fly-by-night representatives of the National Association of Colliery Overmen, Deputies and Shotfirers from Wales, who started off the other procedure. Whereas the current payments have been extended over many years and have not yet been concluded, the pneumoconiosis agreements under the 1974 to 1979 Government were all paid out within 12 to 18 months. We decided on the sliding scale, which has been in existence ever since and which was the template for all payments. Is it not a tragedy that in 1998 Justice Turner chucked all that to one side and enabled all these tinpot lawyers to make their money? I agree that there are a few exceptions, and perhaps I am going too far. I do not doubt that there are exceptions somewhere—I had to use some to defend myself against the Tories and Mrs. Thatcher.
The point that I am trying to make is that there is a lesson to be learned from what we did back then. I hope that my hon. Friend the Minister will pay attention to that during the consultation, to which he referred in his opening remarks, and impress, not on the Government or the Opposition, but on the courts and the legal fraternity that there is a better way to manage payments so that recipients receive a greater percentage of the money paid out than they do under the current schemes of instant gratification, which we see a lot of in the law courts.
The hon. Member for Yeovil has put his foot in it. He came here today and, frankly, made the astonishing statement, which I have never heard before in a Statutory Instrument Committee—I have done a few in my time—that he wants to abolish this Committee. I find it staggering that he can come along here, when we are debating something that is very important in terms of money and representation—taxpayers’ money is being substituted for that of past employers—and suggest that we should not deal with the matter separately. He wants to get rid of statutory instruments and then—the cheek of him—he says, “Oh, by the way, I’ve got a few questions.” If we abolish the Statutory Instrument Committee that is dealing with this matter, how will we have the opportunity to ask questions?
I say to the hon. Gentleman that some MPs, when they have nothing to say, get up and talk as their belly warms, as my father, rather like the grandfather of my hon. Friend the Member for Barnsley, East and Mexborough, used to say. That is what the hon. Gentleman has done today.
9.26 am
John Battle (Leeds, West) (Lab): How can I follow that? I do not represent a mining area, but I welcome these regulations and the widening of the scheme, which was originally for mineworkers but which has had to be extended to cover people who suffer from asbestos-related diseases, in particular mesothelioma.
I want to follow what the hon. Member for South-West Bedfordshire has said, because the scheme is inevitably having to grow like Topsy to cope with the new situation. My figures from the specialists on asbestos say that within the next 10 years some 10,000 people will die of mesothelioma. It is a matter to which I have paid great attention in the House, because there was an asbestos company in my constituency that closed in 1954. Asbestos dust had blown out on to the streets for 50 years, polluting more than 450 people in the neighbourhood. I came to the House in 1987, and there was a massive campaign to hold the company liable for blowing out dust on to the street knowing that it would kill people. It took action to protect people inside the factory, but blew the dust out at tea time, where it fell like snow on door lintels, window sills and streets outside, and all over a school yard. Years later, the victims pick up the pieces in a deadly way, when they die of mesothelioma from one fibre of asbestos stuck in their lung.
When I was first elected, there were a few Adjournment debates on the subject and the Government said, rightly according to the law, that there was no chance of pursuing the matter because the company had closed and no longer existed. Some of us campaigned very hard for five years to prove that it was just a dormant company that had been taken over by Turner and Newall, and we got the case into the courts on behalf of two victims. Then Turner and Newall was taken over by Federal-Mogul, a multinational in America. By that time, the victims, Mrs. Margereson and June Hancock, had won their case in court, which found that the company was in existence and that it was liable.
It is interesting that the figure that the Minister fixed this morning for compensation, £67,800, is exactly the amount that the judge in that case ruled should be the compensation for the two women, who subsequently died. Did those two women ever get the money? No, because the company had been sold to Turner and Newall. We then had to prove that Turner and Newall should go back to court via the Federal-Mogul company, which decided to roll up its British asbestos liabilities and dump the company by putting it into liquidation. Did the families get the £67,000 from the liquidators? No. There was another long, legal carry-on while we worked out who was liable to pick up any part of the company that had been dissolved. People did get a settlement about six months ago in which they received 12p in the pound. I regret that, because if I had accepted that the company had closed and we had not fought to prove that it existed, they would now be getting £67,000 under the regulations. While I appreciate the fact that the Government have stepped into the breach and picked up the pieces, which is a good thing to do, half of me thinks that we are letting those who are really responsible, the companies, off the hook.
The Minister might say, “The companies are not there. What do we do?”, but not one of the companies could operate without insurance, and that is where the money should come from—that is where it came from in the liquidation case. We should prove that a company has a pot of insurance that covers such liabilities and try to drag the compensation back from the insurance. I have two things to ask the Minister. To follow up the question asked by the hon. Member for South-West Bedfordshire, will the scheme be extended to cover those who are not workers but neighbours of an asbestos factory? Neighbourhood liability has been proved in law. If a company knows that what it does inside kills workers, then it knows what it is doing when it blows the same dust outside and kills people in the neighbourhood. Can the scheme be extended in that way, because such people in my constituency are not covered? More seriously, I ask the Minister to get the Department of Trade and Industry and the Treasury to put pressure on the insurance industry, which is responsible for insuring companies against damages and liability.
I am almost tempted to suggest—I shall probably never get a decent insurance policy again—a dedicated windfall tax on the profits of insurance companies to go towards paying compensation to the victims of diseases and industrial accidents. Those people are not getting their just rights. I have nearly 20 years’ experience of long, tortuous legal cases involving an incredible version of what I would describe as corporate gamesmanship, in which companies and insurers try to avoid their liabilities. They do everything that they can to avoid paying out, and then they have the nerve to say, “Mr. Battle, will you go to the Government and ask them to pay instead and let us off the hook?”
Mr. Fraser Kemp (Houghton and Washington, East) (Lab): I thank my hon. Friend for giving way. In the Turner and Newall case to which he has referred, the trust was worth in the region of £69 million and people got a percentage back. He will be aware that the lawyers’ fee for the administration of Federal-Mogul was £70 million, which is £1 million more than the trust was worth. Does he agree that the legal fees in some cases are outrageous? I speak as one who represents not only a former coal-mining constituency, but the town of Washington in which the other major industry was Turner and Newall’s chemical plant, which made asbestos products.
It takes some nerve for companies and insurers to ask us to petition Ministers and the Department for Work and Pensions to pay out, when they have done everything to avoid doing so. Perhaps taxpayers should not pick up the bill and we should insist much more strongly that in law insurance companies should be forced to pay out. I suggest that the DTI and the Treasury should take up the matter in conjunction with the DWP, and that the DWP should look at the implications in the consultation.
Because of changes in the law relating to asbestos, there will, of course, be a peak of claims. If there are to be 10,000 claims between 2017 and 2020, we can estimate the cost. However, I hope that the Government will get heavy with the insurance industry when they start the negotiations and say, “We think that you were backing up the companies. You should be held responsible.” If the companies did not have insurance, then the DTI should have prosecuted them for not operating in a proper way.
9.35 am
Mr. Murphy: The contributions made by hon. Members on both sides of the Committee, but especially by my hon. Friends, highlighted the passion they feel about the issue, the historical sense of injustice, the continuing demands for greater justice for the victims of these dreadful illnesses and, on occasion, the inappropriate handling of their cases by some lawyers and their firms.
I have seen much of my right hon. Friend the Member for Leeds, West this week, in different guises. On behalf of the Committee, I pay tribute to him and to others who have campaigned on an issue that is crucial but does not capture the front pages of the newspapers. I also pay tribute again to Tony Worthington, who is no longer a Member of the House, who campaigned alongside my right hon. Friend.
In view of the history of our party and of the trade union movement, I want to mention Jim Griffiths, who helped to implement much of the post-war settlement on the welfare state and did so much to bring about the industrial injuries disablement benefit scheme in the first place. He was a remarkable man, who became Secretary of State for Wales and obtained a position to which many others currently seek to elevate themselves—the deputy leadership of the Labour party. Well done to Mr. Griffiths; we will see who follows in his footsteps.
My right hon. Friend the Member for Leeds, West raised the matter of Turner and Newall in respect of compensation and the treatment of his constituents and others. He will be aware that my right hon. Friends the Secretary of State for Work and Pensions and the Chief Secretary to the Treasury announced that the Government would introduce a measure to ensure that at least 800 sufferers from asbestos-related diseases would keep their full compensation and we would not seek recovery of the benefits paid.
That decision means that workers at Turner and Newall and other associated companies of the American parent company Federal-Mogul will be exempt from a scheme that ensures that benefit money paid by the state to the victims of accident or injury is returned once the compensation is paid. The Department has laid the necessary regulations and greater funds will be available to compensate that select group of workers.
Mr. Kemp: That is excellent and welcome news to all of us who represent workers at Turner and Newall. It is brave and courageous and involves a considerable cost. Will the Minister urge other political parties to undertake to keep to the Government’s commitment and maintain that money?
Mr. Murphy: It is incumbent on the two main Opposition parties to say so in the Committee. They warmly welcomed the uprating, but I do not know whether they will honour it and give that commitment. I suspect that the hon. Member for Yeovil will nod. He honours every funding commitment because he has an orchard full of money trees in Yeovil. Opposition Members may wish to intervene to say whether they will adhere to the important decision on the recovery of compensation from Turner and Newall.
Andrew Selous: As far as I am aware the scheme was introduced in 1979 and was presumably uprated every year under the last Conservative Government. I am sure my party has no intention of doing anything other than that in future.
Mr. Murphy rose—
The Chairman: Order. The discussion has been drifting further and further from the proposal. I have let it go thus far, but it would help the Committee to return to what we are supposed to be considering.
Mr. Murphy: Thank you, Mr. Wilshire. I will be guided by you, as always.
The scheme was not uprated annually by the previous Conservative Government and we should reflect on whether a future Conservative Government would honour the commitment that has been made today. The hon. Member for South-West Bedfordshire offered it a warm welcome, and it is important for the Committee to try to reach consensus on the proposal. It is also important that people out there, particularly the sufferers of such illnesses, are aware of an alternative Government’s likely position, specifically, as alluded to by my hon. Friend the Member for Houghton and Washington, East, the 800 folk from whom the Government will not seek return of benefit. That is an important commitment. We do not seek to claw back that money, but I wonder whether we are alone in that. Will Opposition Members inform us—perhaps not today, if they are not able or willing to, but later on—whether they would honour the commitments made by this Government?
My hon. Friend the Member for Houghton and Washington, East and my right hon. Friend the Member for Leeds, West raised the issue of legal fees. It is trite to say that the issue is very important; it is more than that. It is a matter of whether people have enough money to continue to provide for themselves and their family at a dreadful time. The Department for Constitutional Affairs is looking into the detail, so I do not want to comment further, but my hon. Friends might want to take the point up with my colleagues in that Department.
I turn to the comments of my hon. Friend the Member for Barnsley, East and Mexborough. We can all reflect on constituency cases, which, for me, is that of Mr. McGuinness, whom I came to know pretty well before he developed mesothelioma. There is a human cost, probably in all our constituencies, but my hon. Friend talked movingly about the human cost in his own family. He is rightly proud of his grandfather. I was wondering what the punch line would be when he talked about the involvement of Arthur Scargill, whose support in the negotiation was sought after the payment of the £9,000. I thought that the punch line would be a letter to say that the £9,000 cheque had been cancelled and not to get in contact again, rather than an additional £10,000.
My hon. Friend the Member for Bolsover raised lawyers’ involvement, particularly the powerful issue of instant gratification. The Government are obviously not involved in that; we are involved in quicker compensation, rather than instant gratification. That is where we want to be as a Government. My hon. Friend was soft on some lawyers, albeit a minority, so I think he is mellowing in his middle age—but that is a wider debate.
Mr. Skinner: I am not mellowing, but since I have been a Member of the House there have been at least three occasions when I have had to resort to lawyers—to defend myself, to get me out of a police cell after the TV-am picket line, and during the miners’ strike, several times. So, I have a little list—a very small list—with a number of selected names that I need from time to time.
Mr. Murphy: Will my hon. Friend place that list in the Library of the House, for ease of reference for colleagues? That is especially the case for the former Member for Glasgow, Hillhead, now the hon. Member for Bethnal Green and Bow (Mr. Galloway)—although I am sure he has his own list.
Turning to the specific points made by Opposition Members, the hon. Member for South-West Bedfordshire, while not committing himself to supporting the funding being put in place today, asked some specific points about whether there was any limit. The Government will honour their commitment. We will honour it with the regulations and by saying we will uprate annually, so there is no cash limit in that sense. Again, fairly or unfairly, I can but assume that the hon. Gentleman is of a similar view, or he would not have asked the question.
Andrew Selous: The Minister asks me to make specific forward commitments. I have said that we are happy to honour the uprating today, although I admit that I was not aware that there had not been uprating in the past. I have every expectation that we would increase the uprating in future, along with other social security benefits, as we always have.
Mr. Laws: Will the Minister give way?
Mr. Murphy: Of course.
Mr. Laws: Notwithstanding the comments made by the hon. Member for Bolsover, does not that earlier exchange rather make my case? It would be useful to provide some certainty to people receiving those funds that future inflation upgrades will not depend on the good will of the Government of the day.
Mr. Murphy: That will depend on having a Labour Government of the day rather than on the good will of the Government, because we have made a commitment to uprate annually.
Two specific provisions in the Welfare Reform Bill relate to other points that have been raised. The first is the designation of a “relevant employer”. We have been operating parts of the scheme on an extra-statutory basis for a while, so the Bill enables us to put in statute what has already been happening for some time. The second provision widens the definition of dependants to include civil partners and those in same-sex relationships as part of the extension of civil rights in this country. I think it is welcomed by most, if not all, in the House.
The hon. Member for South-West Bedfordshire also asked about the processing of claims. As I have said before, none of us can or should seek to defend a system whereby the average processing time for a claim is longer than the life expectancy post-diagnosis. No one can defend that and we would never try to do so. The current situation is not acceptable, which is why we are consulting on how the system can better support the victims of those diseases.
We would rather have a voluntary code of conduct that was toughly policed, but if that did not work, the Government have alternative options. However, as I said, as part of the process we are consulting about how we can speed up claims processing to get support to people much more quickly.
There has been lively discussion during the review process about the issue of family members. Hon. Friends have suggested—strongly—that wives or daughters who wash clothes have been contaminated by a fibre and then contracted mesothelioma. That is one of the issues covered by the review. I urge my hon. Friends to become closely involved with and to try to influence the review.
On the questions about projections for future cases, the figures may change for all sorts of reasons, including any changes we make to the scheme itself, and that may have an impact on the number of claims in future. The latest statistical modelling on the current structure suggests that the number of mesothelioma deaths is expected to peak at approximately 1,950 to 2,450 some time between 2011 and 2015.
On the points raised by the hon. Member for Yeovil, my hon. Friend the Member for Bolsover clearly said, in his characteristic way, that we have no intention of cancelling these deliberations for the hon. Gentleman’s convenience.
Andrew Selous: I fully accept that the Minister may not have been able to obtain answers to two of my questions, but as they have not been answered, will he write to me? First, do the Government view the money purely as compensation and will any requirement for rehabilitation be involved with it? Although that is the subject of the consultation paper the Minister released on 29 January, the point is not quite clear to me so I would be grateful if he would drop Committee members a line about it.
Secondly, the Minister did not answer the question about what his predecessor meant last year, as reported in column 10 of the Official Report, when the right hon. Lady said that a lot of the £800 million was going on lawyers’ fees. I do not understand how that can be the case. His predecessor may have been mistaken, but, for the record, I would like clarification on that point, too.
Mr. Murphy: On the point about compensation being conditional on rehabilitation, the hon. Gentleman has quite rightly posed the question and answered it himself, because that issue is part of the consultation. Therefore if he, or Members of Opposition parties, have strongly held views, it is important that they participate in that consultation to influence its outcome.
I apologise to the hon. Gentleman because I thought that I had answered his questions on legal fees, and my hon. Friend the Member for Bolsover gave a much better answer than I am about to give. About 2 per cent. of industrial injuries disablement benefit costs are for administration, a matter to which my hon. Friend alluded. On the wider point about legal fees and civil actions, to which my hon. Friend the Member for Houghton and Washington, East referred, I responded clearly that the DCA is considering the matter. It is of concern to the Government, and the DCA is examining the specific details. I hope that I have answered all six questions asked by the hon. Member for South-West Bedfordshire and that there will be no need for me to follow them up in correspondence.
The hon. Member for Yeovil asked whether there are any circumstances in which we would not uprate the payments. We are always asked hypothetical questions about circumstances in which we will do something but it is much more difficult to answer questions about circumstances in which we will not do something. Our commitment is to uprate the payments annually and thus far I have not found any equivalent commitment from Opposition parties.
Mr. Laws: Given that commitment, why is it not a statutory obligation?
Mr. Murphy: The support is established under different primary legislation. The provisions of the 1979 Act are distinct from other social security benefits and are consequently not part of the main uprating statement, so a separate debate such as this is needed. The detailed and important points that have been raised today show that such a debate still serves a purpose as part of a conversation about a really important issue. Of course the hon. Gentleman can make representations that we should cancel this annual debate, but as we have tragically yet to see the peak of the diseases in question I am not sure whether it would serve the parliamentary process well for us to cancel our one guaranteed opportunity to have such a debate in Committee.
The hon. Gentleman asked about the number of cases and the amounts paid and said that I sounded a bit like the Chancellor. Only someone from Yeovil could confuse a Fife accent and a Glasgow accent—[Interruption.] Perhaps somebody from south-west Bedfordshire could, too. I will happily provide the hon. Gentleman with the details, but perhaps a short answer will avoid the need for me to write to him. In the current financial year to January 2007 we have made 1,582 payments to individuals, amounting to about £21 million in compensation under the Act. As he said, 87 per cent. of claims made under the Act are successful.
With those detailed comments, I hope that hon. Members have given the regulations a fair hearing and that they will meet with the Committee’s approval.
Question put and agreed to.
That the Committee has considered the draft Pneumoconiosis etc. (Workers’ Compensation) (Payment of Claims) (Amendment) Regulations 2007.
Committee rose at six minutes to Ten o’clock.

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