Employment: Job Creation
Lord Wigley Excerpts(9 years ago)
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The Lord Privy Seal (Baroness Stowell of Beeston) (Con)
My Lords, I think that we ought to hear from the Lib Dem Benches, and then I am sure that the noble Lord, Lord Wigley, will want to go next.
Lord Freud
Some of the statistics in this area are very interesting, in that among the younger generation the pay gap has disappeared. We will wait to see whether that goes on as that generation moves ahead. The most dramatic fact about female employment in this country is that the rate now stands at 69%, which is higher than the rate for the US for both men and women. That shows how far we have gone with female employment.
Lord Wigley
My Lords, is it not the case that the figures—understandably the Minister is boasting today about the high levels of employment—have taken place in the context of the UK being a member of the European Union? Is it not the case that, if the UK were unwise enough to leave that Union, these jobs would be put at jeopardy?
Lord Freud
My Lords, I am being bombarded with massive books of arguments about the economic effects, as are quite a lot of noble Lords, I imagine. I do not think there is time to go into the detail here.
Olympic and Paralympic Legacy Committee
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Lord Wigley (PC)
My Lords, I, too, place on record my appreciation for the way in which the noble Lord, Lord Harris of Haringey, chaired the committee and the excellent support we were given by the committee clerk and his team, and the two special advisers.
As has been noted, the committee put in a very considerable volume of work at short notice to get our report completed by our deadline. Against that background, the Government’s response is disappointing. On many issues raised by the committee in its unanimous report there was little response more than restating government policy without regard to the report’s rationale. There is little point in incurring a commitment of time and money in undertaking such an investigation if the Government treat it less than rigorously. But, to be even-handed, I note my disappointment that there appears to be no direct comment from the Governments of Wales, Scotland or Northern Ireland, either, although many of the recommendations have a direct bearing on the responsibilities of those devolved Administrations. Of course, they have no obligation to respond. However, the Welsh Government recently took their own initiative. I will return to that in a moment.
I make one general point before addressing six or seven of the 41 government responses. The Olympic Games are awarded to a specific city and not to a country. The ethos of the Games requires that the competitors, and hence the competitions themselves, function within a reasonable proximity of the location at which the Games are held. These aspects are not always fully understood. As the general UK taxpayer had to fund the considerable cost of the Games, there was a feeling sometimes that they should benefit more from a greater spread of the activities. For example, there was no need to build artificial mountain cycling locations in Essex. There are perfectly good natural ones in Wales. Sports such as sailing which, inevitably, had to move away from London could have been held in locations such as Pwllheli, where many European competitions are held.
I accepted that London and south-east England would benefit far more from hosting the Games for those reasons, but perhaps the Government should have been more honest from the start by making that clear to everyone. I also repeat what I have gladly put on record many times: that the Olympic Games and, in particular, the Paralympic Games, were a tremendous success and that everyone involved—competitors, organisers, security services and volunteers and, indeed, both Governments—deserve congratulations.
Perhaps I may make a few brief comments on half a dozen issues arising directly from the Government’s response. First, there are the recommendations relating to sport in schools, to which several noble Lords have already alluded, particularly primary schools. I am looking at recommendations 4, 5 and 6. There does not seem to be any new government thinking on those matters; rather, there is the approach that “We are already doing what we deem appropriate”.
I urge the Government to follow carefully the initiatives taken in Wales arising from the work of the noble Baroness, Lady Grey-Thompson, and her review committee. In fact, just yesterday, the Welsh Education Minister Huw Lewis announced a new £1.8 million physical literacy programme for schools. That is part of the response to the report of the noble Baroness, Lady Grey-Thompson, on schools and physical activity. It is to do four things: increase physical activity in schools; develop a physical literacy framework; involve prominent athletes in community sport; and build on Wales’s annual school sport survey.
The Welsh Government, in taking that strategic initiative, have asserted that physical literacy should be as important as reading and writing, which goes towards the proposal of the noble Baroness, Lady Grey-Thompson, that PE should be a core subject, something which will now be considered by Professor Graham Donaldson in his curriculum review, due shortly. No doubt the noble Baroness will expand on some of those points in her contribution.
However, I welcome the Government’s response 13, dealing with the access to and facilities for disabled people at sports grounds, particularly football grounds. I am glad that the Government are prepared to consider further legislation on licence conditions, and I hope that we will be hearing more about that. Can the Minister —our poacher turned gamekeeper, if I may put it that way—indicate the timescale envisaged to progress that legislative aspect?
I am somewhat disappointed by government response 15. It relates to the identification of the net benefit figures and the committee’s call for them to be published. The response has been woeful. The Government appear to be totally complacent about measuring the economic effects in terms of gross benefit and stubbornly refused to identify the net benefit. I can only conclude that they may have something to hide and that the net economic benefit is a much smaller proportion than the gross figures.
As we are repeatedly told that so many aspects of the project spending would have taken place in due course irrespective of the Games, I can only conclude that such infrastructure spending is being treated coyly to avoid the possibility of generating Barnett consequentials for the devolved Administrations.
On response 32, the committee called for SMEs to be helped in the public sector procurement process by having the “compete for” system permanently available. The Government’s response did not address our worries about the danger to SMEs of the proliferation of procurement tools. Can we be assured that the Government have taken that fully on board and are sensitive to the needs of SMEs, and that opportunities for SMEs will be equally available throughout the UK?
The committee noted in item 33 that south-east England benefited disproportionately from the Games and called on UKTI to assess the reasons for the disparity. The Government defend their record by quoting the number of projects going to Scotland, Wales and Northern Ireland—14%, by number—but they do not give the figures with a breakdown by value and do not address the failure to give northern England a fair deal. That response is rather complacent.
I can, however, welcome the response to point 34 about the need to ensure that tourists coming to the UK get beyond south-east England. I notice that the DCMS has asked VisitBritain to address that issue and I hope that the House will be kept informed of progress.
I turn to response 37, dealing with the committee’s questioning of the existence of any long-term distinct legacy benefit of the Cultural Olympiad. The Government passed the buck in its entirety to the Arts Council of England, and every item that it mentions which has a geographic base is in fact in England. That is perhaps understandable for the Arts Council of England, but the Government are a UK Government, and taxpayers in Wales, Scotland and Northern Ireland contributed to funding the Olympic Games. Surely the Government should have been aware of the need to address legacy issues in terms of the arts and culture in the three other nations, not just in England. Perhaps they have done so and have just forgotten to mention it in their response. Perhaps the Minister can clarify that.
Finally, I address item 39, which concerns the omission, tacitly acknowledged in the Government’s response, on ensuring that the legacy is delivered outside London and that a designated Minister should work with the devolved Administrations. The Government’s response is that it is a matter for the devolved Administrations to make the most of the Games’ legacy in devolved functions, so there will be no additional resources or co-ordination on those matters. I believe that that is letting down a particular aspect of the legacy. I pick out those points and ask for the Minister’s response on them, but there are many other points in the body of the report which I hope will not be forgotten.
Mesothelioma Lump Sum Payments (Conditions and Amounts) (Amendment) Regulations 2014
Lord Wigley Excerpts(10 years, 9 months ago)
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The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud) (Con)
My Lords, in moving that the Grand Committee do report to the House that it has considered the Mesothelioma Lump Sum Payments (Conditions and Amounts) (Amendment) Regulations 2014, I will also speak to the draft Pneumoconiosis etc. (Workers’ Compensation) (Payment of Claims) (Amendment) Regulations 2014. These two regulations increase the lump sum amounts payable under the Pneumoconiosis etc. (Workers’ Compensation) Act 1979 and the mesothelioma scheme set up by the Child Maintenance and Other Payments Act 2008. These new amounts will be paid to those who first satisfy all the conditions of entitlement on or after 1 April 2014.
These two schemes stand apart from the main social security benefits uprating procedure and there is no legislative requirement to review the level of payments each year. None the less, I am happy to increase the amounts payable for 2014 by CPI—that is, by 2.7%, which is the same rate as that applied to some social security disability benefits and the industrial injuries disablement benefit under the main social security uprating provisions which were recently debated in the House.
The Government recognise that people suffering from diseases as a result of exposure to asbestos or one of a number of other listed agents may not be able to bring a successful claim for civil damages in relation to these diseases. That is mainly due to the time lag between exposure and onset of the disease, which could be as long as 40 years. Therefore, we fulfil an important role by providing lump sum compensation payments to people suffering from certain asbestos-related diseases through these two schemes. These government schemes also aim to ensure that sufferers receive compensation while they can still benefit from it, without first having to await the outcome of civil litigation. Improved health and safety procedures have restricted the use of asbestos and provided a safer environment for its handling. However, the historic legacy of the common use of asbestos is still with us. That is why we are ensuring that financial compensation from both these schemes is available to those affected.
I will briefly summarise the specific purpose of each scheme. The Pneumoconiosis etc. (Workers’ Compensation) Act 1979—for simplicity I shall refer to it as the 1979 Act—provides a lump sum compensation payment to those who suffer from one of five dust-related respiratory diseases covered by the scheme and who are unable to claim damages from employers because those employers have gone out of business and who have not brought any action against others for damages. The five diseases covered by the 1979 Act scheme are diffuse mesothelioma, bilateral diffuse pleural thickening, pneumoconiosis, byssinosis, and primary carcinoma of the lung if accompanied by asbestosis or bilateral diffuse pleural thickening.
The 2008 mesothelioma lump sum payments scheme was introduced to provide compensation to people who contracted mesothelioma but were unable to claim compensation for that disease under the 1979 Act, perhaps because their exposure to asbestos was not due to their work. The 2008 scheme means that payments can be made quickly to mesothelioma sufferers at their time of greatest need. Under both schemes, a claim can be made by a dependant if the sufferer has died before being able to make a claim.
Payment levels under the 1979 Act scheme are based mainly on the level of the disablement assessment and the age of the sufferer at the time that the disease is diagnosed. The highest amounts are to those diagnosed at an early age and with the highest level of disablement. All payments for mesothelioma under the 1979 Act scheme are made at the 100% disablement rate—the highest rate of payment. Similarly, all payments under the 2008 scheme are made at the 100% disablement rate and are based on age, with the highest payments going to the youngest sufferers.
I would like to give some detailed figures on claims and moneys paid out under the two schemes before us today. In the last full year, April 2012 to March 2013, over 3,500 payments were made in respect of both schemes, totalling just over £53 million.
I know that the occurrences of mesothelioma are of particular concern to Members, with the number of deaths from mesothelioma in Great Britain continuing to rise. In 1968, 153 people died from mesothelioma. By contrast, over 2,000 deaths occur each year from that disease now. Mesothelioma is a fatal disease caused almost exclusively by exposure to asbestos. Those diagnosed with mesothelioma usually have a short life expectancy—generally between nine and 12 months—with the sufferer becoming severely disabled soon after diagnosis. This rise in the number of deaths reflects the long latency period of the disease, which can take decades to become apparent. Latest available information suggests that mesothelioma deaths will continue to increase to a peak of around 2,500 in 2018, and then start to fall—thus reflecting a reduction in asbestos exposures following its peak use in the 1960s and 1970s. Just under a half—47%—of payments made under the Government’s 1979 scheme are in respect of mesothelioma.
I remind noble Lords that immediately following this debate we will be debating the Diffuse Mesothelioma Payment Scheme Regulations 2014, and I would ask that any questions about that scheme, and how it interacts with these older schemes, be raised in that debate.
These regulations increase the levels of support through the government compensation schemes. I am sure that we will all agree that, while no amount of money can ever compensate individuals and families for the suffering and loss caused by mesothelioma, those who are suffering rightly deserve some form of monetary compensation. The government schemes go some way to ensuring sufferers receive it as soon as possible. It is a requirement that I confirm to the Committee that these provisions are compatible with the European Convention on Human Rights, and I am happy to do so. I commend the increase of the payment scales and ask for approval to implement them. I beg to move.
Lord Wigley (PC)
My Lords, I shall certainly follow the Minister’s suggestion that we leave consideration of the new mesothelioma provisions until the next debate, which makes a lot of sense. I shall want to contribute then, if I may. Perhaps I may ask a couple of questions particularly on the regulations made under the 1979 pneumoconiosis Act. In doing so, I welcome, of course, the upratings that are taking place. They should not lose their value as time goes on.
As the Minister and others may know, I have an interest in the 1979 scheme, particularly from the point of view of slate quarrymen. The issue was not, of course, related only to slate quarrymen; it also affected those working in the kiln and cotton industries, and a number of other conditions came under the purview of that Act. Over the period since 1979 there was initially a surge of applications, which reduced in 1986 to just 95. A decade later, in 1995, this had built up to 900, and was running at a level of 1,000 to 2,000 by 2002-03. I believe that some of the cases leading to that surge arose from coal-mining pneumoconiosis, which had not been covered under the coal-mining scheme—there was originally a tripartite scheme between the NUM, the NCB and the Government, in 1975, for that purpose.
I have been trying to ascertain the breakdown of the figures since 2002-03, and would be grateful if the Minister would give some undertaking on this. My colleagues in the House of Commons have been unable to get from the House of Commons Library the breakdown with regard to industry and to the regional spread of those cases. I imagine that the information must be available in the department because it was available 10 years ago. I hope that it might be possible, by letter or some other way, for this to be disclosed. It would be interesting to see how the pattern has changed from the point of view of the sustainability of the scheme itself, which is an important factor.
The second thing I want to ask the Minister is the breakdown of the figure that he has just given us for 2012-13. He mentioned 3,500 payments and £53 million. That figure covered both the 1979 scheme and the 2008 mesothelioma scheme. Presumably there is again some breakdown between those two at the very least, and perhaps the Minister is in a position to give it today, so we can see where this is going. There will be questions about the interplay of the schemes, but I am content to leave those until the subsequent debate.
Lord Alton of Liverpool (CB)
My Lords, like my noble friend Lord Wigley, I will reserve my remarks about the current 2014 scheme to the later orders. However, perhaps I can ask about the earlier scheme and take the Grand Committee back to remarks that the noble Lord, Lord McKenzie, made in 2010 when he was Minister. It is good to see him in his place. He said that the,
“differential in payments puts pressure on sufferers during already extremely difficult times. For example, many feel that they need to rush through a quick claim to the department in order to maximise compensation for their families. Some are too sick to make a claim before dying and therefore their families are able to claim only the lesser amount after the claimant's death. In addition, because mesothelioma is difficult to diagnose and the disease onset is rapid, some sufferers are not diagnosed until after death”.—[Official Report, 23/3/10; col. GC 355.].
This therefore raises the question of dependency and lump sum payments which, when the noble Lord, Lord McKenzie, was Minister, he said should be the same. He commenced the process of reducing the differential and both his remarks and the action he took then are to be greatly welcomed.
Each year since 2010, Members of both Houses have asked that the differential should be reduced and each year that has been rejected, due to economic circumstances. My question to the Minister is: as the economic situation continues to improve, at what point in the recovery will there be the trigger that will lead to the Government honouring the commitment to reduce the differential and in-life lump sum payments? Until we do that, it leads to three specific anomalies. First, the dependants are paid significantly less than in-life claimants; secondly, dependants’ age is cut off at 67, compared to 77 for in-life claimants; and thirdly, the 2008 scheme dependants do not receive the 10% enhancement.
Over the next 10 years, the Government are expected to receive some £71 million, less £17 million gifted to insurers, in additional recoveries under the terms of the Mesothelioma Act 2014. Could some of those additional funds be used to reduce the differential? As I will argue later, perhaps some of those funds could also be diverted towards research because once we have established what the causes and cures are, then we will not have a need for schemes like this at all.
Diffuse Mesothelioma Payment Scheme Regulations 2014
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Lord Alton of Liverpool (CB)
My Lords, the Minister has been generous in thanking Members of the Grand Committee for the work they put in when the 2014 Bill was being considered on the Floor of the House. However, it would be churlish at this juncture if Members of the Grand Committee did not pay tribute to the Minister for the work that he did tirelessly throughout. Although we had our differences on details of the Bill, we all committed to seeing it through its stages here and in the other place because we knew that this legislation was long overdue. It sets in place a scheme that will respond compassionately to people who are given a death sentence when they learn that they have mesothelioma. It is also based on justice, and I know through the contact that I have had with the Minister that he is always keen to see that things are dealt with expeditiously. He deserves warm thanks for the personal efforts that he has made. It is not easy to get legislation through Parliament, and he has done that deftly, while also working with the insurance industry. I think that all of us are sufficiently worldly wise to know that balancing all of those things at once is no mean achievement.
The United Kingdom, as we have heard, has the highest rate of mesothelioma in the world, with a further 60,000 people in the UK predicted to die from this disease in the next 30 years—as the Minister said, more than 2,000 people annually. The need is paramount constantly to urge greater attention to how we assist victims and keep focus on the insurance industry as well as how we better fund and pool research in finding causes and cures for this lethal disease. I was struck by a reply that the Minister gave to me in response to Parliamentary Question HL3144, where he said:
“The statistical model suggests an uncertainty range of 55,000 to 65,000 deaths on that estimate. However, the true uncertainty range may be wider as longer-range predictions are reliant on assumptions about asbestos exposures that cannot currently be fully validated”.—[Official Report, 19/11/13; col. WA194.]
We can add to that the trends in many of the developing BRIC countries, which are going through many of the same experiences that we have gone through, although the figures worldwide are not collected; in answer to another Question that I tabled asking for worldwide statistics, I was told that none were available. Given our own experience as the country with the worst rate of mesothelioma in the world, we should be at the cutting edge or, to mix my metaphors, in the driving seat in insisting that there is a collaborative global approach to this horrendous problem.
The Minister will be aware that I have tabled a Private Member’s Bill, the Mesothelioma (Amendment) Bill, on research. Today gives the Minister the opportunity to say whether the Government intend to facilitate the Bill’s progress and accept the principles that underpin it. The Bill mirrors the all-party amendment defeated here on a whipped vote by a mere seven votes, which was tabled again in the House of Commons by the late Paul Goggins and the Conservative Member of Parliament, Tracey Crouch. On 7 November, the Minister in reply to a Parliamentary Question recognised the importance of research, saying:
“As you are aware there is a cross-Government commitment to support more quality research into mesothelioma. The work that the Department of Health are taking forward on this issue is designed to encourage researchers to pursue projects that will hopefully benefit sufferers of this terrible disease”.—[Official Report, 7/11/13; col. WA69.]
Can we be told today how that work is progressing? Inter alia, I commend to the Minister Early Day Motion 995, moved by Tracey Crouch in another place, which has now been signed by more than 60 Members of the House of Commons. It says:
“That this House notes with concern that mesothelioma is an invasive form of lung cancer caused primarily by prior exposure to asbestos”.
It goes on to give the kind of statistics that I have just given and ends by paying tribute to the,
“great work of the former hon. Member for Manchester, Wythenshawe and Sale East, the late Paul Goggins, to raise the profile of the need for long-term investment into mesothelioma research; and calls on the Government to facilitate the establishment of a long-term sustainable mesothelioma research scheme funded by the insurance industry”.
I would simply add to that the point that I made in the previous debate. Given that some £71 million will come into the Government’s coffers in the next 10 years, less the £17 million that will be given to insurers, surely it will be possible to use some of that money to create a pound-for-pound research fund, where we work collaboratively with the insurance industry.
On the Floor of the House, I recently asked the noble Earl, Lord Howe, about a breakthrough in mesothelioma research which has taken place in Canada. In reply, he said:
“Mesothelioma is a devastating disease, and I certainly undertake to look at the material that the noble Lord has sent me”.—[Official Report, 27/2/14; col. 1005.]
This is probably the most hopeful small breakthrough that I have seen over the years that I have been following this and I wonder, having spoken privately, very briefly, to the Minister, whether he is in a position today to tell us what follow-up has been done by the Department of Health in looking at that breakthrough and what the initial conclusions are. Will he say whether his department and the Department of Health are not only collaborating across government in the United Kingdom but working with others to try, not to duplicate work that has already been done or to reinvent the wheel, to bring together the best practice and knowledge that there is worldwide?
Perhaps I may ask about a reply that the noble Lord gave to me to Parliamentary Question 14/5095, which concerned the extensive tables he produced for the House about the occupations of people who die from mesothelioma. In that reply he said:
“The latest available analysis of citizens dying from Mesothelioma in Great Britain is based on deaths between 2002 and 2010 at ages 16-74. Only the last occupation of the deceased is routinely recorded”.
It is not the last occupation that we need but the data on all the occupations that someone has had. If we are going to get any kind of idea about tracking the causes of mesothelioma we need to know where the hot spots are with this disease.
The Minister continued:
“It is important to note that, for those Mesothelioma cases that are caused by occupational exposure, the last occupation of the deceased which is recorded on the death certificate may not reflect the source of exposure due to the long latency of the disease.—[Official Report, 11/2/14; col. WA 122.]
That begs the question of what use are the tables in those circumstances. Would it not be better to acquire data that would help us?
I was about to turn to the Questions from the noble Lord, Lord Wigley, but as he is about to intervene, perhaps he will save me doing so.
Lord Wigley (PC)
I am grateful to the noble Lord for giving way. Given that it is the last employment that is detailed in the Written Answer, of which I have a copy, does that not camouflage any cases that may arise from the armed services? There are indications that the premises in which many members of the armed services live have asbestos. That raises the question of the incidence and whether or not those families are notified of the dangers with which they are living.
Lord Alton of Liverpool
My Lords, I did not have a chance to compare notes earlier with the noble Lord, Lord Wigley. He has a copy of my parliamentary reply and I have a copy of a reply that he was given on 11 February by the Under-Secretary of State for Defence, the noble Lord, Lord Astor of Hever. After a Written Answer from the noble Lord, Lord Astor, on 4 February, the noble Lord, Lord Wigley, asked about the accommodation of families working for the Armed Forces and whether those living in accommodation that is known to contain asbestos are systematically informed of that fact and the outcome of the regular inspections undertaken of such premises. I was struck by the reply:
“However these reports are not automatically made available to occupants”.—[Official Report, 11/2/14; col. WA 122.]
What value are such reports if they are not made available to occupants?
In reply to another Question asked by the noble Lord, Lord Wigley, about the prevalence of asbestos materials in Ministry of Defence buildings and married quarters, he received a reply saying that some are known to contain asbestos and that the ministry keeps a register of all buildings which are regularly inspected. Surely anyone living in such buildings has a right to know these things.
My noble friend Lord West of Spithead said to me recently—he said that it was perfectly proper for me to repeat this remark in public—that 10 of the cohort that were at Dartmouth with him died of mesothelioma. This relates to a Question that I tabled to the Ministry of Defence. I hope that the Minister will pursue this matter, not only with the Department of Health but with the Ministry of Defence. I asked about the number of annual fatalities caused by mesothelioma involving members of the Armed Forces. I asked what data are kept on the cause of death of former servicemen and what research it planned to commission into the incidence of mesothelioma among former servicemen. I received a long reply on 11 February but the first sentence states:
“Data on the number of annual fatalities caused by mesothelioma does not identify those who were former members of the Armed Forces”.—[Official Report, 11/2/14; col. WA 124.]
Again I ask the question: why not? These are people serving in our Armed Forces who are willing to risk their lives on our behalf. Surely we owe a duty to them to ensure that, if they are in any way being placed at risk as a consequence of exposure to asbestos, everything possible is done to avert that.
Lord Wigley
I apologise to the noble Lord, Lord Alton, for intervening when I did. It clearly shows that we have not been comparing notes, because he was coming on to the very point to which I referred.
Perhaps the Committee will indulge me for a moment if I refer to the debate that we had in this Room on 16 January when I referred to a good friend of mine, Peter Wolfe of Cork in Ireland. Within a matter of days of that debate, he died. He had learnt of his mesothelioma only a few weeks before Christmas. That underlines how quickly this insidious disease kills people. I was at his funeral in Cork on 27 January. That casts a shadow over my contribution to debates on these matters.
The fact that the scheme under consideration today has been set up is a very positive development for victims of diffuse mesothelioma who cannot trace their employer’s insurance. I, too, pay tribute to the Minister for his perseverance in responding to the points raised during the passage of the legislation. I was especially glad to discover earlier this month, and to hear the Minister reiterate today, that claimants under this scheme will be able to gain 80% of the value of compensation claims, up from the 75% threshold which the Government seemed determined to stick to during debates at earlier states. I understand that claimants can now expect to receive an average payment of £123,000 before benefits are recovered, together with £7,000 towards their legal fees.
However, in my usual Oliver Twist fashion, I remain to be convinced about why claimants under this scheme should expect any less than 100% of the average compensation award for this type of disease. Those suffering from diffuse mesothelioma will be in debilitating pain, yet the Government insist that they are limiting the amount of compensation that can be claimed in order to ensure that claimants exhaust all other avenues before coming to the scheme. Surely this is grossly unfair. In effect, it penalises victims of the disease for the negligence of their employers. For the purpose of comparison, it is worth noting that the Pneumoconiosis etc. (Workers’ Compensation) Act 1979 scheme was designed to award 100% of the value of compensation claims to claimants and, as we debated a few moments ago, it is reviewed annually. Why victims of diffuse mesothelioma should not have the same recourse available to them is beyond me, but perhaps that is another battle to be won at some stage.
It is also astounding that claimants under this scheme will have 100% of their benefits recouped from the compensation that is awarded, even though they receive only 80% of the damages. Claimants will thus lose out financially even more, and the Government surely must look again at that aspect.
There were other problems aside from the amount of compensation to be awarded, which were likewise highlighted during the debates on the Mesothelioma Act—problems that have yet to be erased. Principally, it is at best short-sighted that the Government have decided to place an arbitrary cut-off date for eligibility under the scheme. A draft of this compensation scheme was published, as we all know, by the previous Government shortly before the 2010 election, and consultation closed in May of that year. The present Government made no announcement on taking the scheme forward until 25 July 2012, which is the date that they have set as the earliest time when a patient can have been diagnosed with diffuse mesothelioma for these purposes. Individuals who had the misfortune of being diagnosed between February 2010 and July 2012 thus fall between two stools through no fault of their own—a matter that we on all sides of this Committee have emphasised, as well as in previous Committees and in the Chamber during the passage of the legislation. Surely the Government must look at this again.
Furthermore, it is disappointing that the scheme is open only to individuals suffering from diffuse mesothelioma, which is only one of a number of asbestos-related conditions that can come about as a result of exposure to this deadly substance. I would welcome any clarity that the Government can give as to the steps that will be taken to protect the interests of those suffering from asbestosis and other asbestos-related lung cancers.
Finally, I know that many individuals will be grateful if the Government can confirm when people will be able to start making applications under this scheme. I am not sure whether the Minister mentioned that in his comments—I did not catch it if he did—but that would be useful.
Lord Howarth of Newport (Lab)
My Lords, I add my thanks to the Minister and congratulate him on achieving this legislation and bringing in these regulations. I thank him for his compassion, for the collaborative way in which he worked with noble Lords on all sides of the House, and for his strong determination to get to where we have now reached. It is a very significant achievement and he deserves our admiration and gratitude. Like other noble Lords, I am grateful to him for raising the level of compensation to 80% of average compensation awards. That is a significant improvement that will make a lot of difference to families when they find themselves in such dire need.
I want to ask the Minister just one question. Will he clarify that it is his intention that the overall value of the scheme should continue to be set at 3% of gross written premiums after the peak year for claims? He has told us that we are to anticipate perhaps 2,500 claims in 2018, after which the numbers may reduce—although the noble Lord, Lord Alton, told the Committee that it is projected that there will be another 60,000 cases over the next 30 years. There will continue to be a significant volume, and I put it to the Minister that it is important that that 3% of gross written premiums is not reduced in the years after 2018. We all hope that after a long period of Labour Government, starting in 2015, the Minister may still have an opportunity to play some part in these affairs. I appreciate that it is difficult for him to bind his successors but it would be helpful if he would say on the record that he, as the architect of this scheme, envisages that the employers’ liability insurers should continue for the whole future life of the diffuse mesothelioma scheme to have to provide 3% of gross written premiums. If that was the case while the numbers of claimants or beneficiaries of the scheme were falling, it would make it possible to move the level of compensation up from 80% towards, or perhaps to reach, 100%. That would be one very important possibility.
There are other good things that it would be possible to do were funds to remain available while the total number of claims fell. It would become possible to backdate the eligibility for the scheme beyond July 2012 to February 2010 or even further. It would also be possible—I tabled an amendment to this effect in Committee on the Bill—provided that the legislation allows it, which of course is questionable, to adapt the regulations to cover family members who themselves contract mesothelioma even if the person who was exposed to asbestos in the workplace did not personally contract the disease. We talked about the case of a member of the family—most likely the wife—who washes the overalls of the person who has been exposed to asbestos fibre in the work-wear and she contracts the disease. As I understand it, the Minister has still not been able to bring those people into eligibility. However, if we had a slightly less tight financial envelope, then, through keeping the 3% of gross written premiums to fund the scheme, it would be possible to help those people.
Of course, it would also be possible to mitigate benefits recovery. I know that the Minister’s department, for theological reasons, will set its face against that, but, as the noble Lord, Lord Wigley, said, it seems very hard and unreasonable to claw back 100% of benefits from people who are receiving only 80% of average compensation. So there would be further latitude there. There would of course be further latitude to provide additional funding for research, the case for which has been so consistently and eloquently made by the noble Lord, Lord Alton. Among the range of options, it would also be possible to extend the benefits of the scheme, or perhaps a newly created parallel scheme, to victims of other long-latency industrial diseases whom we want to help.
I do not know what sorts of permutations might be possible but one could envisage this range of possibilities, and I hope very much that this afternoon the Minister will at least be able to tell us that there will not be a tapering of the overall value of the fund. The industry having treated mesothelioma sufferers so very badly over many decades, it seems to me that it should not be let off the hook. I appreciate that the current generation of employers’ liability insurers are not the worst culprits, and perhaps not the culprits at all in individual cases, of the failure to honour the policies that were written. However, I think that the industry as a whole has to continue to bear its share of responsibility and—I know that this is the spirit in which the Minister has always approached this whole issue—we should do the very best that we can for people who at the moment the scheme is not intended to help but who it would become possible to help if we maintained the value of the fund past 2018.
Disabled People: Mobility Benefits
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Lord Wigley
To ask Her Majesty’s Government what assessment they have made of the number of disabled people who have had access to adapted cars removed as a result of changes to their entitlement to mobility benefits.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud) (Con)
My Lords, no such assessment has been made. The controlled approach to the reassessment of recipients of disability living allowance began only on 28 October 2013. There is not enough information yet to assess the effect this phase will have on Motability customer numbers, including those with adapted cars. In addition, the vast majority of reassessments will not start until October 2015.
Lord Wigley (PC)
My Lords, does the Minister recall that exactly 12 months ago his department estimated that by 2018 there would be 428,000 fewer enhanced mobility claimants aged 16 to 64 on the new PIP system, compared with the old system? Does he appreciate the anxiety this has caused to those dependent on these payments to finance their Motability vehicles? Will he update the House on the latest position, and do everything in his power to lift the threat felt by those people whose degree of disability almost certainly will mean that they should not lose their Motability entitlement but who, until they know, will inevitably fear the worst?
Lord Freud
My Lords, I emphasise that we are looking to create a thorough assessment under PIP that is balanced and also looks after some of the gaps in DLA, particularly concerning people with mental health problems, who have not done as well under DLA as they should do under PIP. With regard to the concerns about the transition, we are working with Motability to put together a package of £2,000 per person for those who move off the enhanced DLA but not into PIP so that they can purchase a second-hand car at the appropriate time.
Mental Health: Cost of Living Support
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Lord Freud
My Lords, on the process of getting PIP, we have been taking advice from people with an interest, particularly the autism group, which I know the noble Lord will be interested in, and we have been adjusting our PIP application process to reflect the observations and points made by those groups.
Lord Wigley (PC)
My Lords, does the Minister accept that if people in those circumstances can find work, fine—but if they cannot, they need all the help they can get to access what they have a right to? Should we not therefore ensure that the citizens advice bureaux, which play a key role in these matters, have the resources they need to help such vulnerable people?
Lord Freud
My Lords, helping people with mental health problems and similar conditions is, clearly, not easy. The main problem is that they face a huge variety of problems. We need to help them as much as we can to negotiate their way through a complicated system. I have taken a huge interest in this issue myself, and in the most important area in this respect. We now have a study on what we are calling psychological well-being and work, to look at how we can help people negotiate their way into the workplace, with adequate health support on the way.
Mesothelioma Bill [HL]
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Lord Freud
My Lords, I know that the noble Lord does not want me to go into detail, but I can commit to going on working with him on this issue, which is very technical. If we work out that something needs to be adjusted, we will have time to do it in the other place.
Lord Wigley
I express my appreciation for the increase from 70% to 75%, although a lot of us would have liked to see 100%. I would like clarification on the new matter that the noble Lord introduced with regard to the review. The mechanism for this might be introduced in another place. Will he shed some light on the means by which any changes could be implemented? Will order-making procedures be available, or will it be a matter of going back to primary legislation whenever such changes are needed in the light of developments?
Lord Wigley
My Lords, I support the amendment. I shall address in a moment the points made by the noble Lord, Lord Howarth, but I want to signal my support for Amendment 2 and the associated amendments, which will allow a very small percentage, some 1%, of the levy on active insurers to go towards a supplement for further research into mesothelioma. As we heard from the noble Lord, Lord Alton, a few moments ago, any way of encouraging new people to come into this area of research must be worth while, and that is something that the noble Lord, Lord Howarth, did not address in his remarks. At present the mechanisms are not generating enough research and the research that is currently being undertaken is in danger of being eroded, if not ended. I am also glad that Amendment 24 specifies that the Secretary of State must consult insurers, medical charities and research foundations before making regulations in this respect. I congratulate the noble Lord, Lord Alton, on his perseverance on the matter.
As has been mentioned, in 2011 the British Lung Foundation invested £850,000 in research into mesothelioma, and £400,000 was invested by other charities. In Committee the indications were that it did not appear that much money was coming from the Government. Now, if I understand it correctly, the Medical Research Council has found some rabbits to come out of the hat, and that is all to the good. However, more work clearly needs to be done. If we give due credence to the figures that have been quoted and requoted about the 56,000 people who are in danger of dying from this, if any progress can be made by way of research to reduce the likelihood of those people dying, that is something that we as a House have a duty to undertake. Whether or not this is the appropriate vehicle to do so, it is the vehicle that we have to hand at the moment and we should not lose this opportunity.
The agreement brokered by the British Lung Foundation has meant that over the past three years four large insurance firms have collectively invested £1 million a year into research in this area. I warmly welcome that initiative. It has seen concrete results, as has been mentioned, such as the creation of Europe’s first mesothelioma tissue bank. However, that funding will soon be coming to an end and we need to ensure that the research goes on. The firms that were involved in the initial agreement have indicated that the industry as a whole should be involved in funding future research—that idea comes from them—and that a voluntary agreement would be unworkable. If we are to secure the breakthrough that we need in this area, funding must be made available for research. If that needs legislative underpinning, so be it. Perhaps the Minister can indicate that if the amendment passes, or if he finds another way to reach the same objective when the debate goes on to another place, he will consider including the possibility of a short annual statement on the amount of funding going into mesothelioma research from all sources and the progress that is being made.
Lord Lester of Herne Hill
My Lords, I greatly look forward to the Minister’s reply. I just want to say one sentence. The very first thing I had to do when I came to the Bar in 1964 was to act in relation to the Industrial Training Act 1964, which, as I recall, imposed a levy on the building industry in order to subsidise training within the industry, and it worked perfectly well.
Earl Howe
My Lords, I accept that fully and I will come to that point in a second.
Certainly there was a blockage in the research process, but it was not total. There is good news. As the noble Lord, Lord Alton, informed us, spending on mesothelioma research is not as low as noble Lords might believe from the discussions in Committee. The latest figures from the Medical Research Council show that its annual spend on mesothelioma research rose from £0.8 million in 2009-10 to £2.4 million in 2011-12. We should not belittle those figures. That is in addition to the research supported by the £1 million a year donated by insurance companies to the British Lung Foundation, and research supported by the National Institute for Health Research. Therefore, on the ability of the system to support publicly funded mesothelioma research, we are not knocking at a closed door.
My noble friend Lord Stoneham is right that the issue that is holding back progress on research into mesothelioma is not lack of funding but the lack of sufficient high-quality research applications. This is an issue that we in the Department of Health, working with the National Institute for Health Research, have been seeking to address. I will now set out what we propose. There are four elements to it.
First, the National Institute for Health Research will ask the James Lind Alliance to establish one of its priority-setting partnerships. This will bring together patients, carers and clinicians to identify and prioritise unanswered questions about treatment for mesothelioma and related diseases. It will help target future research, and, incidentally, will be another good example of where patients, the public and professionals are brought into the decision-making process on health.
Secondly, the National Institute for Health Research will issue what is called a highlight notice to the research community, indicating its interest in encouraging applications for research funding into mesothelioma and related diseases. This would do exactly what the noble Lord, Lord Alton, wants, and what the noble Lord, Lord Empey, suggested. It would make mesothelioma a priority area.
Thirdly, the highlight notice would be accompanied by an offer to potential applicants to make use of the NIHR’s research design service, which helps prospective applicants to develop competitive research proposals. Good applications will succeed.
Finally, the NIHR is currently in discussion with the MRC and Cancer Research UK about convening a meeting to bring together researchers to develop new research proposals in this area. The aim is for the event to act as a catalyst for new ideas that will further boost research into mesothelioma. I was very interested in what the noble Lord, Lord McKenzie, told us about the offer of matched funding from the ABI. I look forward to hearing more about that.
As my noble friend Lord Freud mentioned, on 25 July in the Palace of Westminster precincts, he and I will co-host an event run by the British Lung Foundation that will focus on mesothelioma. I will take this opportunity to invite noble Lords to join us to hear about current research and to get a family perspective on the disease.
The four steps that I have set out offer a better and much more realistic way of achieving what we all want to see happen. The problem with the remedy that the noble Lord proposed is that it will not of itself deliver that objective. I could sum up the issue by saying that the availability of funds does not guarantee the spending of funds. Nor does it guarantee the quality of research on which such funds would be spent. It is also worth making the point that it would create a precedent that might encourage other and perhaps less deserving interest groups to seek special treatment for a disease about which they care passionately.
I hope the noble Lord will recognise that his amendment has galvanised the Government into action. He can credit himself with having achieved a valuable outcome by tabling it. I hope that he will consider not pressing it. I have given undertakings today that I will be keen to take forward with him and with all relevant stakeholders.
Lord Wigley
May I ask the noble Earl to respond to my earlier question on whether, in the context of the four proposals that he has brought forward, there might be a mechanism for some form of annual report on the progress of mesothelioma research so that we do not lose focus on this important issue?
Lord Howarth of Newport
My Lords, the common theme of the amendments in this group is that they increase eligibility with a view to increasing justice. I add my personal thanks to the noble Lord, Lord Freud, for all his personal commitment to achieving just outcomes through the legislation, and I hope that he will be willing to contemplate the amendments that I have added to this group.
First, I entirely support my noble friends Lord McKenzie of Luton and Lady Sherlock in their amendments which would bring forward the start date for eligibility to 10 February 2010. Amendment 5 in my name would extend eligibility to a person diagnosed with diffuse mesothelioma who was self-employed at the time of exposure to asbestos. Amendment 6 would extend eligibility to a person who is a member of the same household as a person exposed to asbestos in the course of their work.
The employers’ liability insurers have bluntly and, I feel, rather brutally, expressed their view that the self- employed should not be eligible. As they have explained to us:
“As employers’ liability insurers will be funding the untraced scheme, payments from the scheme will only be made to those who would have been covered by employers’ liability insurance”.
The ABI has, however, made one small, decent concession, saying that under the untraced scheme, if someone has been negligently exposed during employment and self-employment but is unable to find an employer or insurer to claim against, they will be able to receive a payment from the untraced scheme without a deduction for the period they were self-employed.
In Committee, my noble friends Lord Browne, Lord Wigley and Lord McKenzie explained that on the kind of industrial and construction sites where people were negligently exposed to mesothelioma, there was frequently no real distinction between employed and self-employed status. In many cases, it may have suited employers to classify people as self-employed who were, to all intents and purposes, employed. Indeed, in Committee the noble Lord, Lord Freud, himself accepted that,
“some people will appear to be self-employed where the reality is that that was an artificial, tax-driven construct. In that case, if they can demonstrate that in practice they were acting like an employee, they would be eligible for a payment under the scheme.”.—[Official Report, 5/6/13; col. GC 220-221.]
I am very grateful for what the noble Lord said then, but we need to go a bit further. We need to ensure that everyone, whether they were nominally, technically or otherwise self-employed, is covered and is eligible to receive payments from the scheme.
What is the position of those who were genuinely self-employed, did insure, but whose documentation has gone missing? Should they not be included? The ABI itself admits:
“There will only be a very small category of people who have been solely self-employed and therefore not eligible for a payment from the untraced scheme”.
The Minister undertook to ask the ABI for its figures, but unfortunately, he then had to write to us to say that it did not have any reliable figures. What is clear, by the ABI’s own admittance, is that the numbers are very small.
The suffering of self-employed people who contracted diffuse mesothelioma, and the suffering of their dependants, is no less than the suffering of people who were employed in the technical sense. I believe that it would be wrong for us to abandon them, and I believe that it would cost very little by way of an addition to the levy, to embrace them in the scheme.
In Committee there was extensive concern expressed by noble Lords on all sides about the predicament of members of the household of someone who had been exposed to asbestos in the workplace, who were diagnosed with mesothelioma, when the person who was actually employed had not been diagnosed. Indeed, a household member might have predeceased an employee who has not, or not yet, been diagnosed. The noble Lord, Lord Alton, reminded us of one particular instance, movingly described to us in our proceedings on other legislation, of the sister of the noble Lord, Lord McNally. Other noble Lords in Committee were aware of individual cases where this had happened. In particular, the most frequent instances were when a wife, or perhaps a daughter, was regularly doing the laundry and washing the contaminated overalls.
In writing to us, the noble Lord, Lord Freud, gave us an estimate that an average of 214 cases of mesothelioma would be caused by environmental exposure in the years 2014-24. I take it that that is a wider category that would include household members; indeed, the friend of the noble Lord, Lord Walton of Detchant, the consultant neurologist who died, might have been included. We are talking of a significant, though not a huge, group of people. Is it right to abandon them on the technicality that they were not themselves employees?
The term “secondary exposure” was used in Committee, but I think we are really talking about the direct effect of employers’ negligence. It is the same lethal fibres in the same workplace that will have caused the disease to hit a person, whether self-employed or a household member in the circumstances I have described. Surely it was through employers’ negligence that employees were allowed to come home wearing their contaminated workwear; they should not have done so. On this, the ABI has been silent. Perhaps even it cannot contrive presentable reasons as to why it should not pay out of a scheme which, after all, is not based on precise legal liability.
This scheme deals with the situation of claimants who, by definition, cannot avail themselves of their legal rights. I do not think that the employers’ liability insurers ought to hide behind legal technicalities. If, however, the employers’ liability insurers are adamant, and if the Minister remains reluctant to compel them, then I hope that he will consider levying the public liability insurers. He was as good as his word; he discussed the question of public liability insurance in this context with the Association of Personal Injury Lawyers and with the ABI. He wrote to us following that discussion to say that, in the main, it would be the public liability policy that would apply when the affected person was not directly employed by the liable employer. In many cases, I think it is the same insurer.
I have not tabled an amendment relating to public liability insurance because, as I take it, this is already covered by Clause 13(1), which states:
“The Secretary of State must make regulations requiring active insurers to pay a levy”.
It does not specify active employers’ liability insurers, and in Clause 13(7) I do not see that the definition of the term “active insurer” excludes the public liability insurers. I would be grateful if the Minister would confirm that the legislation as drafted does give him the power to levy the public liability insurers. If that is not the case, I am sure that there will be no difficulty in tabling an amendment for Third Reading.
The Government’s 2008 scheme does not worry about who in particular was responsible for cover; it simply compensates people who have contracted mesothelioma. This new scheme should do the same, and in particular, should embrace mesothelioma victims who are self-employed or household members. The scheme is intended belatedly to make amends, and it should do so fully and generously. If the employers’ liability insurers would accept that, then that would be gracious on their part. I beg to move.
Lord Wigley
My Lords, I support these amendments and I will pick up the important points made by the noble Lord, Lord Howarth of Newport. I entirely support his emphasis on the need to ensure that those who suffered at second hand—whether it was the wives, daughters, or sometimes mothers of people in the industry who have been infected by the particles from washing clothes—should most certainly be covered if they have suffered a loss of health as a result.
The implication is that the insurance policies that were provided for the employees in case of negligence by the employer only relate to the employee in a very narrow sense. That needs to be explored in depth because there is a category of people who have undoubtedly suffered ill health and some who have died, and there may well be many more that come through from that avenue.
However, I return to the generality of these amendments. It has been noted in this debate that the scheme proposed by the Bill has its roots in the consultation announced by the previous Labour Government in February 2010, which is the date in these amendments. However, the scope of the assistance proposed in that consultation was, of course, significantly wider than what we have ended up with in the Bill.
Lord Howarth of Newport
My Lords, Amendment 16 is in my name. Again, the common theme is that the amendments in this group seek to maximise the amount that will be paid to mesothelioma victims and their dependants. I will come in a moment to my own amendment but I would like to say a few words in strong support of the amendments in the names of my noble friends Lord McKenzie of Luton and Lady Sherlock. It was certainly not the fault of the claimants that the documentation went missing and it is very hard to see why they should bear the burden. The Minister has spoken of the dangers of a disproportionate burden on the employer’s liability insurers, but is it not a disproportionate burden on the mesothelioma victims?
The ABI has put forward various arguments as to why payments under the scheme should not be at the same level as the average of court awards. The first is that an incentive must be provided for claimants to go to court. If they could just as easily get 100% by going to the scheme, why would they bother to go to court? With respect to the ABI, this argument is nonsense. This will not be a matter of choice for the claimants. The Minister’s letter to us of 4 July made it clear that the scheme is designed as a,
“last resort where all routes to civil action against the relevant employer or insurer are closed to the individual”.
The procedures under the scheme will make that a compelling reality. There will be the single portal and the identical search for documentation. Whether someone is on their way to having their case heard in court or considered by the administrators of the scheme, they will have recourse to the scheme only if they are unable to have recourse to the court, so the incentive argument is nonsense.
The ABI has also said that it is important to ensure that the overall cost to insurers is sustainable in the long term. I believe that the overall cost of a somewhat improved scheme—we have been debating today a variety of ways in which that scheme might be improved —would indeed be affordable. Apart from the fact that the insurers did very well for decades in being able to invest the premiums of mesothelioma sufferers whose documentation could not be found and who therefore could not bring a case, we have to remember in addition that between 1979 and 2008 the employer’s liability insurers were effectively subsidised by the taxpayer to the tune of hundreds of millions of pounds, as they were allowed to keep the amounts paid out under the Government’s pneumoconiosis scheme to offset against the cost of the liabilities of the insurers.
Even now, because the Minister declined in Committee to incorporate in the Bill the possibility of creating parallel and comparable schemes for other diseases such as asbestosis, asbestos-related lung cancer or pleural disease, only some 50% of sufferers from asbestos-related diseases stand a possibility of being compensated under this scheme. Those other 50% will in effect be subsidising the insurers. Those are a handful of reasons why I take with deep scepticism the proposition that the insurers could not afford to improve the scheme. We know, indeed, that their case load will fall, so even if it was a little pricey for them in the early years it would rapidly become more affordable. The Government are also going to smooth the way over the early years.
It is unlikely that the cost of these improvements would cause the cost of the scheme to creep above the 3% of gross written premiums. I prefer the DWP’s calculations on this to the ABI’s. However, if that were to happen it would not be a disaster and is not terribly relevant, because it is other factors that move premiums. The Minister’s fear that any improvements to the scheme would lead to the point at which additional burdens were placed, by way of higher premiums, on employers and industry is misplaced. The premiums that are charged in this market are the product of multiple factors and paying the beneficiaries-to-be somewhat more generously would not have an effect on the premiums. I do not believe that the percentage of gross written premiums has any bearing on what premiums are sought in the marketplace. The employer’s liability insurers pitch their premiums at the maximum that competitive market conditions allow. They will always do that, so the Minister’s fear is misplaced and he should call their bluff on that.
Finally, the third reason that the ABI gives is to stop people getting more than the courts would award. In its briefing, it said to us:
“As the payments will be made … on a straightforward tariff, some people will receive more compensation under the scheme than they would have received in civil compensation, and the aim is to set the tariff at a level that means this will only happen in a small number of cases”.
Elsewhere, it told us that the intention is for the tariff to be set “a little below” the average of awards made in civil cases. A little below? The proposition is that 30% should be docked from the average of court awards in the payments provided under the scheme. Seventy per cent was not enough and while we are very grateful to the Minister for easing the level of payments up to 75% of the average of court awards, that is still not enough. Nor would 80%, as in the amendment of my noble friend Lord Browne and the noble Lord, Lord Wigley, be sufficient in my view. Ninety per cent is the very minimum with which we could be satisfied. As the Association of Personal Injury Lawyers has pointed out, the Financial Services Compensation Scheme, which provides compensation where insurers have become insolvent, pays at the 90% level.
I turn for a moment to my own Amendment 16, which would prevent what I regard as excessive demands for repayment by the DWP through its agency, the Compensation Recovery Unit. The rationale for the figure of £110,000 is that if we expect the average of payments over the next 10 years to be £87,000—it may be fractionally more, now that the Minister has moved it up to 75%—and if, as the Minister has advised us, the average recovery required from claimants will be £20,480, add those two figures and you get to £107,500. Round that up a little and you get to £110,000. That is appropriate because payments under the scheme, unamended, will be meagre. At the same time, the DWP —and no doubt the Treasury, lurking behind it— aggressively intends to reclaim 100% in recovery of benefits and lump-sum payments from people who will have received only 70% of what they might have received in court.
Moreover, the department intends no abatement in its reclaiming to take account of pain and suffering, which they would do in the case of an award by the courts. So we risk the £87,000 typical award by the scheme being reduced by around a further £20,000 as a result of the DWP’s reclaims. According to the Association of Personal Injury Lawyers, the best estimate of what mesothelioma victims and their dependants will receive from the scheme will, therefore, be only 60% of what the courts might have awarded. It cannot be right that these people should receive only 60% of their legal entitlement when they have suffered a double negligence: negligence on the part of their employer and negligence on the part of their insurer.
The Minister has said that his intention, in this legislation, is to remedy a market failure. To be frank, that is a euphemism. We are talking about a gross and scandalous dereliction of their proper responsibility on the part of a number of insurers, affecting a significant number of people who should have had cover. This has been a great evil and we should make amends as fully and generously as we possibly can. Is that double negligence on the part of employers and insurers, from which they have already suffered, to be compounded by a double meanness on the part of the Government, insisting on taking 100% of 70% and taking no account of pain and suffering? The Government are being too greedy here.
Lord Wigley
My Lords, I shall speak primarily to the lead amendment, to which I have added my name, and return to Amendment 12, which stands in my name, at the close of my remarks.
The scheme proposed by the Bill will provide neither the full amount of compensation to which the sufferer would usually be entitled, nor full protection for those suffering from asbestos-related diseases. It is utterly unjust that those who have already suffered a wrong, due both to their injury and to the negligence of their employers in losing their insurance records, should now face losing a significant percentage of their damages.
The Government have offered the justification that mesothelioma claimants should be encouraged to seek out “all other avenues” before coming to this scheme. As I said during earlier stages of the Bill, this attitude shows a flagrant disregard for the harsh realities of this disease, not to mention the fact that the sufferers usually die very soon after diagnosis, so leaving their families with less compensation than they would otherwise have been entitled to. Of course, I welcome the move to increase the compensation payable from 70% to 75%, and I thank the Minister for securing that improvement. However, whether the Government propose that claimants should receive 30% or 25% less than the average worth of a claim, it is essentially unfair that any reduction is happening at all. By point of comparison, the Pneumoconiosis Act 1979 was designed to award full compensation to claimants and is reviewed annually.
The difference between 100% and 70% compensation for these claims is not to be balked at. On 25 June, the noble Lord, Lord Wills, asked the Government what assessment had been made of the likely impact on the insurance industry if it was made to pay the full 100% of compensation to sufferers under the proposed scheme. In his response, the noble Lord, Lord Freud, said that over the first 10 years of the scheme, if the tariff were 100%, the amount of compensation paid would total £451 million. Under the 70% tariff originally proposed, the insurance industry was, by comparison, forecast to pay £322 million. However, the money that the insurance industry saves by getting away with 70% or 75% is a cost suffered by the victims’ families.
The Minister also said that the Government,
“are getting an average of £87,000 a head to people who suffer from this terrible disease”.—[Official Report, 25/6/13; col. 654.]
It is presumably now nearer to £94,000 at the 75% level. According to the Association of Personal Injury Lawyers, if the tariff was set at 100% and based on the figure proposed by the noble Lord, Lord Freud, the amount of compensation awarded would be around £124,000. That is a £30,000 shortfall in what the victims and their families can expect and it is a big difference. It is a difference of millions of pounds for the insurance companies but, my goodness, that £30,000 difference for the victims will be even harder to bear.
Finally, I want to share with the House two of the many comments that I have been sent by families of asbestos victims. Sandra Emery wrote:
“It took Parliament … a hundred years to ban asbestos. As a result, I have lost my mother and brother to mesothelioma. Please do not compound the error by passing such inequitable legislation”.
As Kerry Jackson says:
“All victims and their families deserve 100% of what they are entitled to … this is a disease that has come through pure neglect”.
I ask the Government for an undertaking that they will continue to seek other ways to increase the compensation to around 100%. I plead with them to reconsider. I will not be pressing my amendment for the 80% level, which I would have done had the Minister not come forward with an increase. However, in order to register my support for the principle, if the 100% amendment is pressed to a vote I shall support it.
Mesothelioma Bill [HL]: Impact
Lord Wigley Excerpts(11 years, 5 months ago)
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Lord Freud
My Lords, the point about research is that it is pretty complicated, one reason being that the Medical Research Council is constrained by the quality of the research proposals presented to it. There is a bit of a chicken-and-egg situation going on, as I see it, and I am working with my noble friend Lord Howe and the British Lung Foundation to break that situation. We are hosting a seminar on the importance of mesothelioma research shortly to try to stimulate the proposals for funding. As for the second aspect of the question, clearly there has been much debate on the exact level of compensation. In the end, this has been a very complicated and intricate deal to make sure that we can get good sums of money. We are getting an average of £87,000 a head to people who suffer from this terrible disease who have not been able to find any compensation whatever.
Lord Wigley
My Lords, those who have suffered industrial lung diseases get the full level of compensation under the 1979 pneumoconiosis Act, when they cannot identify their former employers to sue them, so by virtue of what reasoning should there be a scaling down for those who suffer from mesothelioma and cannot identify their insurance policies? They suffer equally and have great need of those funds.
Lord Freud
My Lords, I know that everyone in this House would agree with the proposition that we want to get as much money as we possibly can to mesothelioma sufferers, particularly those who, through no fault of their own, have not been able to trace the insurer that should be paying them the employers’ liability compensation. The reality is that we cannot trace the insurer in roughly 10% of cases. We are trying to make sure that we trace as many as possible. They will get the full amount, and then get a payment—not quite as much as I would want, but a safe, sustainable payment, for this group of people, and that is a lot better than the nothing they are getting currently.
Social Security (Disability Living Allowance, Attendance Allowance and Carer’s Allowance) (Amendment) Regulations 2013
Lord Wigley Excerpts(11 years, 5 months ago)
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Lord Hardie
My Lords, I declare an interest as honorary president of Capability Scotland and share noble Lords’ concern about the changes to the regulatory regime. In that regard, I refer noble Lords to my observations of 13 February at cols. 737-78, which I shall not repeat. The present regulations, among other things, affect claimants who have entered into a Motability agreement and are thereafter hospitalised. The noble Baroness, Lady Thomas of Winchester, derived some comfort from the assurance that Motability will not recover those vehicles if a patient is hospitalised, but if one reads paragraph 7.10 of the Explanatory Notes, one sees that that is not what the Government have said. They say that the Motability scheme has stated that it would aim to avoid recovering vehicles from hospital in-patients affected by that change.
That is not the absolute assurance that hospital patients will not lose their vehicles. Without such an assurance, the reality is that if a person is in hospital for a particularly long period, the payments made by the department to Motability on behalf of the patients will not be made and the vehicle—the car, motorised scooter or motorised wheelchair—may well be recovered. Indeed, the Explanatory Notes recognise that if it has to be recovered, Motability will give some allowance, depending on the condition of the vehicle when it is recovered.
These are concerns, because the present system means that payments direct to Motability continue to be made after the hospitalisation of a claimant. That is recognised as an exception to the rule that social security benefits are affected after hospitalisation. In my view there is a good reason for that, because these payments are payments of a capital nature to enable people to have the necessary facilities to give them the independence that they need. They are different from revenue paid direct to the person for their maintenance.
Regulations 10 and 11 remove this exemption for no good reason. It is no answer to say that it is intended to bring Motability users into line with other recipients of DLA or PIP. As I have sought to explain, they are in a different position to the other claimants. Moreover, the consequences of this change are draconian. There is a real risk of the repossession of necessary equipment, resulting in the inability of such claimants to lead independent lives after they leave hospital until they are able to renegotiate other Motability contracts. The noble Baroness, Lady Hollis, explained the complexities of that. There will be a delay in obtaining necessary equipment, during which period these people will not be able to live the independent lives that they have enjoyed previously. Can the Minister advise the House what timescale is involved between the order and delivery of a purpose-built powered wheelchair, scooter or modified vehicle?
I also ask the Minister what is the urgency in promoting this change, particularly in view of the announcement by the DWP on 17 June, already mentioned, of a further consultation on the mobility component of PIP? Would it not make sense to have an integrated approach and to leave these changes to form part of the consultation process? Has there been any consultation with interested parties or the public at large about this significant change? If the Government are not willing to await the outcome of the consultation, can the Minister tell the House how many people will be affected by this proposed change?
The loss of a wheelchair or car may have greater implications in different parts of the country. I have been anxious to assess the whole issue of Motability payments and their geographical distribution because I suspect that the impact of the loss of a vehicle might have greater impact in rural areas than in cities where there are probably better—although not ideal—transport facilities for wheelchair users. On 4 June, I tabled four Questions for Written Answer about the Motability scheme and received a reply dated 13 June. I refer noble Lords to Hansard cols. WA 255-56. I commend the Minister and his officials for the speed of the reply but it did not answer all my questions. My Questions HL594 and HL595 sought data for three years—2010, 2011 and 2012—but the answer provided data only for the last year, preventing me from undertaking any effective analysis.
Moreover, in relation to Questions HL596 and HL597 seeking information about participants in the Motability scheme, the Minister replied:
“The Department does not hold information on the numbers of Motability customers in each local authority district or area of Great Britain”. [Official Report, 13/6/13; col. WA 256.]
That reply echoes his statement on 13 February at cols. 741-42.
I have some difficulty with these statements. As I understand the system, if a claimant elects to use the Motability scheme, payments on his or her behalf are made by the department directly to Motability. If my understanding is correct, the department must know how much it is paying to Motability and on whose behalf payments are being made. This information will identify the local authority, district or area of each claimant on whose behalf payments are made. I have written to the Minister seeking a full answer to my Questions and I look forward to receiving that in due course.
If it is truly the case that payments are made by the department to Motability without it knowing the identity of the beneficiaries, it is a matter of concern that the department cannot account for these payments. Such a failure may be of interest to the Comptroller and Auditor-General, the Public Accounts Commission and perhaps even the Treasury. Until the department provides the House with the information about such payments, I invite the Minister to amend these regulations by deleting this particular change.
Lord Wigley
My Lords, I am grateful for the opportunity to speak in this debate and to congratulate the noble Lord, Lord Alton, on bringing it forward. I should declare an interest as president of Mencap in Wales and a number of other disability organisations. The matter that we are discussing is of immense concern to countless thousands of disabled people who are dependent on the vehicles they get for their mobility. This is true generally; it is a particular problem in rural areas, to which I will come in a moment. Perhaps I might pick up the points as they have been made in turn.
First, on consultation, may we please have an assurance from the Minister that all relevant disability organisations will have a full opportunity not just to submit evidence but to engage in meaningful two-way discussion on this matter, and that the process will not be truncated and time-limited?
Secondly, on the more than 600,000 Motability vehicles, the Government must know how many people stand to lose their adapted vehicles, so why will they not come clean with the statistics? As the noble and learned Lord, Lord Hardie, mentioned a moment ago, they must know those statistics. I congratulate him on the Questions that he has tabled and the statistics that he has obtained, which bring this matter into sharp focus.
Thirdly, I draw the attention of this House to the disproportionate geographical impact. I obviously have concern with Wales. With 5% of the population, it has 7.4% of the total casework and 8.4% of the higher rate caseload. This is for an amalgam of historic industrial reasons, which we will not go into now. Those people stand to lose, and many are in areas with the lowest incomes per head in these islands—places such as Blaenau Gwent and Merthyr Tydfil, where I used to live, and where almost 13% of the population have a dependency on the mobility component. In my next-door area of Anglesey, which has one of the lowest GVAs per head of anywhere in the United Kingdom, at just 55% of the UK average, there is a caseload of 7.2%. That is in a rural area where they do not have alternative means of transport and taking away vehicles will deprive disabled people of the ability to get around.
The changes we are talking about will compound the disability and poverty suffered by these people. It will be made infinitely worse if they cannot have their mobility. They will be very badly impacted by these changes.
Baroness Wilkins
My Lords, I declare a tangential interest as a recipient of DLA since its inception, although being no longer of working age I am unaffected by the introduction of PIP. I will not repeat many of the excellent points that other noble Lords have made.
In a recent document, Motability set out the ways in which it is trying to ameliorate the changes and lessen the punitive impact of reclaiming customers’ vehicles. It states that the price to individual customers wishing to buy their current car will be in the order of £8,000 to £12,000. In the current climate, when disabled people have been repeatedly hit by cuts, how will many be able to afford that kind of outlay? Will the loan sharks be out in force to make yet another killing from people desperate not to lose their employment?
The Minister for Disabled People’s answer to those people facing the loss of their employment because of the introduction of PIP has been the Access to Work scheme. What work has been done to see if this could in fact be a more expensive alternative? For example, the chief executive of my local disability organisation needed to use Access to Work while he could not drive a car. The daily cost of the journey both ways was £80—£400 per week. On top of that, he has the cost of taxis for shopping, getting to the doctor, et cetera. Compare that to £55.25 high-rate mobility element of DLA, which provides him with a transport for all these activities.
Mesothelioma Bill [HL]
Lord Wigley Excerpts(11 years, 6 months ago)
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Lord Freud
My Lords, I am grateful for those observations. I am sure that we will have a chance to discuss this in more detail later. I now move to—
Lord Wigley
Before the Minister moves on, is he not going to respond to the point made by his noble friend, who has shown that there were cases, which is totally at variance with the lead the Minister gave to the Committee?
Lord Freud
My Lords, we could spend all day on one point. I am just trying to get a response on the record. We will have another chance to go through this again. I was making a clarification.
I turn now to the query of the noble Baroness, Lady Sherlock. When discussing the proposed start date of eligibility for this scheme, we talked about insurers being able to reserve against that liability from that date. The noble Baroness drew attention to the fact that the levy will be an annual running cost, not a liability to reserve against. She is of course correct: the payment is not the same as a liability. However, the impact is much the same. The levy is an additional cost to insurers that needs to be factored into their business plans. To do this, they need to have confidence in the timing and amount of the cost to be incurred. Therefore, on 25 July 2012, when the intention to set up a payments scheme was announced, this provided a sufficient level of confidence for insurers to start to factor the levy into their business plans for 2014. I ask the noble Baroness’s forgiveness for my incorrect use of terms, and for her recognition that this does not change the shape of things in this case.
Lord McKenzie of Luton
My Lords, in moving Amendment 29, I will also speak to Amendment 30. Clause 7 provides for the Secretary of State to administer the payment scheme or to make arrangements for a body to administer the scheme. The arrangements can allow the body to arrange for somebody else to administer the scheme or any part of it. Amendment 29 would ensure that any further delegation which is permitted has the approval of the Secretary of State. This is a straightforward issue. Administering the scheme is an important undertaking, and the Secretary of State should be satisfied that those involved are fit for purpose.
It may be that the Minister will say that the Secretary of State should not have to be bothered if somebody is appointed to administer, say, a routine part of the scheme such as the processing of payments. However, as it stands, an appointed body would appear to be able to cause the whole of the operation practice to be transferred to somebody without any recourse to the Secretary of State. Our concerns in this matter might be negated if we knew what arrangements the Minister envisages for membership of any company or other body which it is expected will run the scheme. We know the insurance industry view but, by now, the Government must have arrangements in mind. Perhaps the Minister will share these.
This leads on to our Amendment 30, which requires the administering body to be constituted from members who are demonstrably independent of any active insurers. As levy payers, clearly they have an interest in the numbers and the profile of successful claims. The Minister may again say that they may also have an interest in helping people bring proceedings against individual insurers. That may be so, but it does not negate the fact that active insurers have a direct financial interest in the outcome of the scheme.
Of course, it is accepted that claimants have a right of appeal, but we have already touched on the costs and time of this, and it is not a sufficient answer. In the draft scheme rules it does not appear that there is a requirement for any specific insurance expertise to be brought to bear—or, if there is, it does not seem to be the driver of the scheme. What discussions have taken place with the insurance sector about administration? I beg to move.
The Deputy Chairman of Committees (Lord Geddes)
If the noble Lord will curb his enthusiasm for just a moment, the amendment proposed states:
“Page 4, line 11, after ‘may’ insert ‘, subject to the consent of the Secretary of State,’”.
Lord Wigley
I am grateful for being curbed. I support the amendment. It will lead on to Amendment 32, which also addresses these issues, so I may come back to them at a later stage. It is immensely important that this body is seen and respected by those outside the industry as being at the very least impartial with regard to the way things will be conducted. It must have the confidence of the beneficiaries, their families and everyone else involved. This amendment, together with Amendment 32, which we will consider in a moment, needs to be taken on board, if not in this form of words then at least in a form of words that addresses what could be a weakness in the Bill.
Lord Freud
I thank the noble Lord and the noble Baroness for their amendments. I assure them that all diligence will be observed during the setting up and monitoring of the administrative body. Irrespective of the background of the scheme administrator, the body will have to administer the scheme in a way that satisfies the requirements of the legislation and apply scheme rules that will ensure that the administrator is sufficiently tied to a set of rules as determined by the Secretary of State and not by the insurance industry. What matters is not whether the body administering the scheme is formally independent of the insurance industry but whether it is controlled by the arrangements put in place by the Secretary of State and whether it is properly monitored. The arrangements will achieve that.
The insurance industry is setting up a company to meet the requirements of the scheme rules. There would be time advantages to using such a body, with it potentially being able to make payments more quickly than if the Government had to establish a body. However, any body with which the Secretary of State makes arrangements will be subject to the standard call-off contract that gives us the power to change a supplier should it fail to operate as required.
I make it clear that we will undertake due diligence in ensuring that whoever ends up delivering the scheme does so in compliance with the rules that we set out. If any body does not meet our requirements, we will not make arrangements with it, and, if it fails to deliver, we will make arrangements with another one. I will respond to Amendment 32 when the noble Lord moves it. It may be relevant, and I will make a further statement at that point.
Lord Wigley
They say in the world of chess, as I have quoted before, that a threat is more dangerous than the execution. Clearly the threat of the speeches coming in support of this amendment evoked the shooting of the fox before it got out of its hideaway. I am grateful to the Minister for his positive response. Obviously, it is in the hands of the noble Lord whether to now withdraw the amendment, but I hope that we will come back to this on Report.
Lord McKenzie of Luton
My Lords, I hope we can be brief with this. In moving Amendment 36, I will speak to the other amendments in this group; namely, Amendments 37, 38 and 39. I have raised the issue with the Bill team, so this is an opportunity to put something on the record.
Schedule 2 precludes an individual from claiming benefits under the 1979 and 2008 state compensation schemes if an application is made under the mesothelioma scheme provided for in the Bill. Equivalent exclusions are added to the parallel Northern Ireland legislation. This probing amendment simply adds the word “successful” to the reference to “application”. As it stands, if somebody should apply to the mesothelioma payment scheme unsuccessfully, Schedule 2 would seemingly prevent access to the 1979 or 2008 statutory schemes. I cannot believe that that was intended and it would not be particularly fair. I beg to move.
Lord Wigley
My Lords, I will speak briefly in support of this amendment for the same reason: to try to get clarification with regard to the interplay with the 1979 scheme. I raised this matter at an earlier stage and would be very interested in some clarification from the Minister.
Lord Freud
I thank the noble Lord and the noble Baroness for these amendments, which I understand are probing amendments. I am hopeful that I can give complete satisfaction on the matter. The intention of these amendments is to enable a person to apply for a payment under the Pneumoconiosis etc. (Workers’ Compensation) Act 1979, or under the corresponding legislation in Northern Ireland, after they have made an application for a scheme payment but before a scheme payment is made or where the application is unsuccessful.
One of the conditions of entitlement under the 1979 legislation is that a person has not brought any action or compromised any claim for damages in respect of a disablement, for example by issuing proceedings against a negligent employer or insurer, or by settling a potential claim out of court. The provisions of Schedule 2, which these proposals would amend, ensure that people who apply to the scheme and those who bring an action or claim for damages are treated equally under the 1979 Act. If a person is prevented from claiming under the 1979 legislation because they have made an application to the diffuse mesothelioma payments scheme, instead they may still be able to claim under the 2008 diffuse mesothelioma schemes established under Part 4 of the Child Maintenance and Other Payments Act 2008 and the corresponding Northern Ireland legislation.