Wales Bill
Debate between Lord Wigley and Lord Howarth of Newport(10 years ago)
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Lord Wigley
My Lords, I am delighted to have added my name to this amendment and very much support what the noble Lord, Lord Elystan-Morgan, said. At an earlier stage of the Bill, we had an opportunity to go into this issue in some detail. I will not repeat that or repeat the arguments that he has put forward. I will just underline that, ideally, I would like to see the control of the number of seats, as with other aspects of the Assembly, in the hands of the Assembly itself. However, an amendment on that will not be forthcoming now, which is why I am very glad to support this amendment.
Although noble Lords made persuasive cases at an earlier stage for the membership of the Assembly to be more than 80—to be 100 or even 120, as the noble Lord, Lord Elystan-Morgan, said—I accept that 80 is a logical number to go up to now. As my noble friend can confirm, the design of the building is such that it can expand to accommodate 80 Members without too great difficulty, so that at least avoids any additional cost in that regard.
As an elected Member of the Assembly in the first four years, I found the work pressure enormous. I accept that the nature of the work was a little different then. There were probably more committee meetings and they have been rationalised, possibly because of the pressure on Members’ time. I was on five committees and I was finding that very difficult indeed. Sometimes people say, “Ah, well, you should be there from nine o’clock on a Monday morning onwards”, but that does not overcome the problem of a shortage of Members to sit on all the committees.
An increase to a membership of 80 would also allow for the possibility of having a greater range of expertise in the Assembly cohort. I know from my time there of the benefits of having Members with first-hand medical experience; I think of Dr Dai Lloyd. All parties have people with various types of expertise. Clearly, the more Members you have, the better chance you have of getting a full balance of expertise.
I felt the pressure when there was no more than a secondary legislative role for the Assembly. To do justice to the increased workload of a full legislative role, and not having a second Chamber to go through the detail—I am not arguing for there to be one—much more attention needs to be given to scrutiny of legislation on a line-by-line basis. That requires people with the time, commitment and ability to do the job.
I very much hope that the Minister, if the proposed new clause is not accepted, can indicate that this question will be taken on board between now and St David’s Day.
Lord Howarth of Newport
My Lords, the noble Lord, Lord Elystan-Morgan, made his case in masterful fashion and has given a political explanation of why he confines his proposal for an increase in the size of the Assembly simply to 80, not a higher number.
As the noble Lord, Lord Cormack, said in the debate on an earlier amendment, in constitutional change form should follow function. A rigorous analysis is needed of the functions that the National Assembly for Wales already has to perform and the functions that are increasingly to be devolved to it. This legislation provides that the Assembly should take control to a significant degree of income tax and borrowing. The obligations that will fall upon the Members of the Assembly are not therefore solely in terms of additional legislative scrutiny but invigilation of public expenditure, authorising expenditure, and controlling and examining its quality. Whether the National Assembly for Wales would wish to replicate the sort of committee structure that we have in this Parliament, such as the Public Accounts Committee in the House of Commons, I do not know. That should rightly be a matter for the Assembly. However, what is beyond doubt is that the scale, range, complexity, difficulty and importance of the tasks that the Assembly has to undertake have been growing, are growing and will continue to grow.
Therefore, following the example already given by the Electoral Commission in Wales in certain respects, further analysis should be made of the membership required in order for the Assembly to manage to perform the tasks that the people of Wales, and indeed the United Kingdom, will expect it to carry out. For that reason, I very much welcome the spirit of the amendment. I would be happy if it were to be accepted but it would be seen only as a provisional step. It might be preferable that further work be carried out on this proposition, so that we can see exactly where, in practice, it should take the National Assembly for Wales.
The noble Lord, Lord Wigley, wisely and realistically observed that there is a constraint on physical space in the Assembly building. However, we should not be unnecessarily deterred by that factor. After all, when the House of Commons was reconstructed after the war, Winston Churchill, as Prime Minister, thought it appropriate deliberately to recreate a Chamber that would be a pretty tight squeeze for all its Members. That works rather well so we should not be worried.
Wales Bill
Debate between Lord Wigley and Lord Howarth of Newport(10 years, 1 month ago)
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Lord Wigley
If the noble Baroness refers to the Silk report, she will see the arguments made there. The whole point and ethos of the Silk report is to open out as much freedom as possible for the devolved authorities to develop ideas and even experiment with this area to reach the objectives that both she and I would wish they did. It is giving them more tools. I hope that those tools help them do the job.
Lord Howarth of Newport
My Lords, whatever the future structure of the United Kingdom, the union is surely to be based upon twin principles of solidarity and diversity. Tax credits are a principal structure of the welfare state. As my noble friend just now suggested, the welfare state is a fundamental underpinning of that solidarity. Given that in the last figures I saw only about 2% of the people of Wales do not wish to maintain the union, I very strongly suspect that noble Lords are a little bit ahead of themselves—not for the first time—and that the people of Wales would wish nothing to be done that would weaken the welfare state and undermine that principle of social solidarity that ought to underpin the union. I make this point particularly because great figures in Welsh political history were among the leading architects of the welfare state. Whether by accident or design, we should not do anything to undermine the welfare state and the solidarity that binds the people of Wales together with the rest of the United Kingdom through the welfare state and associated principles of fiscal redistribution.
Lord Newby (LD)
My Lords, Amendments 21 and 22 seek to include a reference to “associated tax credits” as part of the power to add further devolved taxes. I thought that the noble Lord was going to discuss tax credits associated with devolved taxes. In respect of landfill tax, at the moment, existing site operators can contribute a percentage of their tax liability to environmental benefits and get a 90% tax credit. As far as devolved taxes are concerned, that ability will still exist. For that type of tax credit, the power is there.
I think that the noble Lord, Lord Howarth of Newport, was talking about welfare benefit payments. Welfare benefits are not covered by the Bill. There has been no proposal to devolve power over welfare benefits to the Welsh Assembly. I thought that the noble Lord made strong arguments about why that might be opposed. The Bill makes no provision for devolving discretion over welfare benefits to Wales for good reason, and the Government are not minded to change their view on that.
Amendment 23 would remove the UK Parliament from the process of creating further devolved taxes. The Bill enables the Government to devolve further existing taxes as well as enabling the Welsh Government to create new devolved taxes. Clause 6 requires that if either of these powers is used the order would need to be approved by this House and the other place as well as by the Assembly.
Wales Bill
Debate between Lord Wigley and Lord Howarth of Newport(10 years, 1 month ago)
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Lord Wigley (PC)
My Lords, I will also speak to Amendments 53 to 55. This group seeks to bolster the Assembly’s economic accountability and resources. We in Plaid Cymru believe that the Welsh Government should be able to issue bonds, just as the Scottish Government can. Amendment 52 would hence provide for a review into whether this could in fact take place. It is a very modest amendment giving the opportunity for this to be further investigated. I should point out that this was a recommendation of the Silk commission and is supported by the Welsh Government as well as by my own party.
Having this power would allow the Welsh Government to use innovative, less volatile ways of borrowing such as the Build for Wales scheme that we have championed. Such a project would create a new entity to invest in public infrastructure. At present, if the Welsh Government want to undertake large amounts of capital expenditure to invest in building schools, hospitals, roads and so on, they are unable to borrow and cannot raise enough by way of tax to provide the necessary resources. If they save the funds, the Treasury may claw the money back if it is not spent within a certain period—as was so disgracefully done in 2011 when savings prudently accumulated by the Welsh Government were ruthlessly purloined by Her Majesty’s Treasury. It is surely against common sense that the Welsh Government are unable to borrow funds long term to fund capital assets.
Amendments 53 to 55 would ensure that the threshold for the Assembly’s capital borrowing powers is raised from the £500 million in the Bill to £1,500 million—that is, £1.5 billion—which would make the Welsh Assembly more closely aligned to the £2.2 billion threshold afforded to the Scottish Parliament. We would feel very unhappy if the Scottish Parliament were able to borrow four times the sum that we can in Wales. We arrived at our figure by taking into consideration Wales’s population base as well as the fact that we have fewer PFI commitments than Scotland, hence giving us greater flexibility over repayments. I beg to move.
Lord Howarth of Newport (Lab)
My Lords, it is absurd that there should be a need for a review of such a matter. It is absurd that there should be limits on the ability of the Welsh Government to borrow. We all remember—I think we are all old enough—that in the 1960s and 1970s local authorities issued bonds, as did utilities. Much more recently, universities have issued bonds, notwithstanding that to a significant extent they are publicly funded. This is an elementary tool of financial management which, if the Assembly is to take serious responsibility for its own affairs, of course it ought to have.
My only complaint about Amendment 55, proposed by the noble Lord, Lord Wigley, is that he has been so modest. He wants to limit the amount that the Assembly is permitted to borrow to £1,500 million. There is a constraint on the amount of borrowing that rests in the ability of the Welsh Government to service the interest. That should be a sufficient discipline.
Wales Bill
Debate between Lord Wigley and Lord Howarth of Newport(10 years, 4 months ago)
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Lord Howarth of Newport (Lab)
My Lords, in a democracy, decisions ought to be taken at the level closest to the people whose lives they affect. The principle of subsidiarity is right, the moral and emotional case for devolution is powerful, and I support the Bill. But how to design a model of devolution in practice is far from straightforward. Politics is about reconciling and balancing different interests. How much devolution, and what kind of devolution, is in the interests of Wales and is in the interests of the United Kingdom? A wisely designed model of devolution—the holy grail—would strengthen both.
The first requirement is that the model of devolution should be clear, which is why I agree with many noble Lords who have spoken that it is now time for Wales to have devolution on the reserved powers model, not on the conferred powers model which leads to disputes in the courts and creates profound uncertainty. Silk was clear about this but the Bill, disappointingly, fails to address it. In this regard, Wales should be placed on the same footing as Scotland and Northern Ireland.
As my right honourable friend Peter Hain once remarked, devolution is not an event but a process, and the people of Wales have now made up their mind, after much initial hesitation, that they like devolution. They are glad that they have it and, as the noble Lord, Lord Elystan-Morgan, said, they have advanced up the curve of expectation and confidence. Wales is not Scotland, but if the people of Wales want no less devolution than is allowed to the people of Scotland, they should have it. But of course that raises the question: what do the Scots themselves want? And, as we consider these matters, what is in the interests of England, which is a thought all too commonly absent in debates on devolution? How can devolution strengthen the United Kingdom in the interests of all? Vague and open-ended promises of devo-max made by political leaders in the run-up to the Scottish referendum do not seem to be a responsible or satisfactory way to proceed. How is all this going to end?
Most of the wider constitutional issues that were considered in Silk Part II have been deferred to the other side of the Scottish referendum on 18 September. But perhaps after that, people will start to suggest that they ought to be deferred beyond a possible referendum on the United Kingdom’s membership of Europe. The noble Lord, Lord Wigley, stressed the importance to Wales of membership of the European Union. It is never the right moment to decide what the next stage of devolution should be but it is good that the Government are proceeding in the Bill. We should proceed where there is sufficient consensus both within Wales and across the political parties in the United Kingdom.
Although the constitutional issues have been largely deferred, there are provisions in the Bill on elections. The Bill would bring back dual candidacy: the right of a candidate to stand both in the constituency election under first past the post and on the regional list. As my noble friend Lord Rowlands has just recollected, the origin of these mixed elections was the recognition by the Labour Government in 1997 and 1998 that a Welsh Assembly elected solely by first past the post would, given the political patterns of Wales, be Labour-dominated for as far as the eye could see. It was Aneurin Bevan who remarked that “the purpose of getting power is to be able to give it away”, but that magnanimity is all too rare in politicians. It was found, however, in Ron Davies, the Secretary of State for Wales at that time, who believed that it was right to create a Welsh Assembly that would be in some sense ecumenical.
It is of course right that the parties should contest elections under both systems but I strongly believe that it is inappropriate that individual candidates should be able to run simultaneously under both systems. That being permissible, we got the absurd situation in the Clwyd West election in which all four first past the post candidates were elected. That can hardly have encouraged political engagement. Why bother to vote at all if everybody gets in? The noble Lord, Lord Bourne, observed that the people of Wales were not confused about this. No, I do not think that they were confused but simply that they were shocked, and the abuse got worse because those who had been elected on the regional list system then used publicly provided funds to set up constituency offices to establish a power base in the constituencies which they were targeting.
The noble Lord, Lord Wigley, said that the Labour Party’s objection to the restitution of this state of affairs is—and I wrote down what he said—naked party-political jiggery-pokery. I was going to refrain from mentioning in my remarks the scandal of Leanne Wood’s leaked memorandum to Plaid Cymru candidates in 2003 but, provoked by the noble Lord, I think it right to remind the House of it because not all noble Lords may be familiar with what she said in her missive to them. She said:
“We need to be thinking much more creatively as to how we … use staff budgets”—
those are budgets provided by the taxpayer—
“for furthering the aims of the party”.
She went on:
“Regional AMs are in a unique position. They are paid to work full-time in politics and have considerable budgets at their disposal. They need not be constrained by constituency casework and events, and can be more choosy about their engagements, only attending events which further the party’s cause. This can be achieved by following one simple golden rule: On receipt of every invitation, ask ‘How can my attendance at this event further the aims of Plaid Cymru?’ If the answer is ‘very little’ or ‘not at all’, then a pro forma letter of decline should be in order”.
This is a scandal that in the annals of political scandal should be in red letters and I hope that it makes even the noble Lord, Lord Wigley, blush. It is now a further scandal that the political parties which are the minority parties in Wales are using the majority that the coalition provides for them in Parliament at Westminster to take powers to resume these abuses. They are shameless about it and what they are doing will be seen for what it is. I agree with other noble Lords—my noble friend Lord Rowlands among them—that the Welsh Assembly and the people of Wales should decide their own electoral arrangements.
Lord Wigley
I noted the way in which the noble Lord nipped out quickly to get a copy, quoting from an earlier debate. The question I want to put is this. Would he apply the same change to Scotland now, given the political arithmetic there?
Diffuse Mesothelioma Payment Scheme Regulations 2014
Debate between Lord Wigley and Lord Howarth of Newport(10 years, 8 months ago)
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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.
Mesothelioma Bill [HL]
Debate between Lord Wigley and Lord Howarth of Newport(11 years, 4 months ago)
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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.
Legal Aid, Sentencing and Punishment of Offenders Bill
Debate between Lord Wigley and Lord Howarth of Newport(12 years, 8 months ago)
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Lord Howarth of Newport
My Lords, I, too, welcome the concession that the Government propose in Amendment 68, in so far as it goes, to allow legal aid to be available in cases where infants have suffered perinatal injury. As the parent of a child who suffered perinatal injury, I can only welcome it. I simply ask the Minister on what argument of principle he extends legal aid to that group of people but not to others whose lives may be ruined through the experience of clinical negligence.
Lord Wigley
My Lords, I shall speak briefly in support of Amendment 13, proposed by the noble and learned Lord, Lord Lloyd of Berwick, and Amendment 15, tabled by the noble Baroness, Lady Grey-Thompson, both of which would go some way to bring civil legal proceedings relating to clinical negligence back within the scope of the Bill. I welcome the comments made by the noble Lord—my friend, outside the political arena—Lord Cormack and by the noble Lord, Lord Carlile, on the cases that he has been following up. I shall be very interested to hear the replies to them.
Having campaigned with the noble Lord, Lord Ashley of Stoke, on the question of thalidomide, many years ago, those comments ring bells. We must ensure that, in drawing up a strict structure which is meant to avoid exceptions, other than those provided for specifically, we do not lose the possibility to secure justice for people who may be, as the noble Lord, Lord Carlile, rightly said, in the same position in this day and age.