Mesothelioma Bill [Lords]

Debate between Mark Reckless and Tracey Crouch

Monday 2nd December 2013 Commons Chamber

[Tracey Crouch (Chatham and Aylesford) (Con)]

It is a pleasure to speak on this issue, on which I have a great deal of knowledge from working in the insurance industry for five years before I became a Member of Parliament and from representing a constituency with very high levels of mesothelioma. Britain has the highest rate of mesothelioma in the world and sadly that rate is rising. In the past five years, the south-east of England has had the highest rates of deaths from mesothelioma compared with anywhere else in the UK. Medway, with its heavy industry and dockyard history, is a particular hot spot.

Mesothelioma is a horrific disease that is contracted exclusively by exposure to asbestos. Those who are diagnosed are often dead within a year. For many years, lawyers and insurers have taken their time to settle claims through civil procedures, leaving great financial uncertainty for sufferers and their families. A great deal has been done to speed up civil claims for victims and tribute ought to be paid to the work of Senior Master Whitaker for making that happen. However, there remains a small yet significant group of people who contracted mesothelioma but could not be compensated either because of poor record keeping by their employer or their employer’s insurer, or because neither existed any more.

The Bill will help to rectify that and is therefore welcome, but it still contains shortcomings that, if Ministers, insurers and lawyers were open-minded, could be rectified at little extra cost to them. Before going into detail, I congratulate Lord Freud on his sterling efforts to introduce the Bill. From my own experience of working in the insurance industry and alongside lawyers, I know that the negotiations would have been very difficult. He deserved the praise he received from peers on both sides of the House as the Bill progressed through the other place, but it still lacks fair compensation for victims of this dreadful disease.

In my preliminary discussions with interested parties, there was consensus on one point: the Bill will give sufferers something. That is true and something might be better than nothing, but the Bill puts the something squarely in the pockets of the insurers and lawyers, and not as much as there should be in the hands of the victim. The victim is the one who turned up to work and was exposed to asbestos. The victim is the one who happened to work for a company that kept shoddy records. The victim is the one who will die through no fault of his own. The Bill has room for improvement, based on further compromise.

Their lordships debated the Bill on a set of assumptions that have been revised since it has progressed to this place. The goalposts have moved. It is a shame that what should be a simple piece of legislation has become so mired in suspicion and confusion regarding what is and is not included in the levy. When the Bill was discussed in the Lords, Lord Freud made it clear that the levy could not be more than 3% gross written premium. That was to ensure that insurers financing the scheme would not incur additional costs that would be passed on to their existing customers. At that point, the levy agreed with the insurance industry was 75% and equated to, as illustrated in the Department for Work and Pensions’ own analysis in support of the Bill, 2.79% GWP in the first four years of the scheme and 2.27% GWP in the first 10 years of the scheme.

Since the debate in the Lords, the assumptions relating to legal costs have changed. Their lordships debated a fixed legal fee of £2,000, but we are now debating a fee of £7,000. In truth, there is total confusion about who will pay the fee. As the Association of British Insurers understands it, it will be paid by claimants out of their compensation which the Government will uplift accordingly. Not only is it unclear what precisely the fee is for, but what the other 25% is paying to administer. It would be helpful if the Government clarified who pays the legal fees. Is it the claimants out of their compensation or the insurance companies out of the administration fee? If it is the claimants, we need to be absolutely clear that when they are awarded £57,000 of compensation, £7,000 of legal fees will have to be deducted from that award.

Lawyers, insurers and the Government are, unsurprisingly, at loggerheads on the fixed fee, presumably because if it is acceptable for this scheme, why could it not be applied to civil claims? Where would it fit into the LASPO review that the Ministry of Justice is expected to complete and report on next year? At the heart of the Bill is supposed to be the fact that the victim is coming into the scheme at last resort. A lot of what is required will have already been done, so lawyers in a civil claim might not be as necessary as they would be in this scheme. Senior Master Whitaker has helped a great deal and the Department is clear that in some circumstances a medical report would be enough. The underlying point, however, is that because of the revised estimates, about which I remain sceptical, there is no room to raise the compensation limit from 75% to 80%—a much fairer level of financial recompense for victims of the disease. In his introduction, the Minister said that 75% is not the important figure and that the 3% levy is. With the greatest respect to the Minister, it is the level of compensation that is important to the victim, not what the level of GWP is to the insurance industry.

[Mark Reckless (Rochester and Strood) (Con)]

My hon. Friend mentioned that Medway is a hot spot for the disease. There have been 42 deaths in my constituency in the past five years—a greater number even than in her constituency, and about three times the national average. She mentioned the 3% and 75% figures. Is it not the case that the changes to which she referred will affect the sums relating to the 3% cap? If that is so, will it not be open to Ministers to show some compromise or movement in the direction that she is so ably arguing for?

[Tracey Crouch]

My hon. Friend is right that our constituencies are particularly affected and I am delighted to see him in his place to debate this important issue. He makes an important point. The Government have set a cap of 3% and there is no room for manoeuvre unless they are willing to stand up to the insurance industry and say that there is a firm view on both sides of the House that the 75% they have currently negotiated is not good enough. They need to agree on another figure. I believe that 80% would be appropriate as a good compromise between the 90% being called for by the lawyers—they cite the Financial Services Compensation Scheme as a useful comparator—and the 70% the insurers were originally willing to accept. Furthermore, with the previous assumptions under which their lordships debated the Bill, 80% would have been 2.98% GWP over the first four years and 2.42% over 10 years. Now, with the 3% cap, under the new legal costs associated with the scheme, there is no room for manoeuvre. I find that disappointing, unless the Minister is willing to stand up to the insurance industry and discuss this.

Aviation

Debate between Mark Reckless and Tracey Crouch

Wednesday 4th July 2012 Westminster Hall

[Mark Reckless]

My hon. Friend makes a good point, and I congratulate her on her work in campaigning for economic development in her area. The fundamental point is that although jobs might be created—I do not deny that there would be a lot of jobs; perhaps 200,000, as some estimates suggest—they would come 10, 15 or 20 years from now, and would be almost entirely taken by a vast migration of people who would be forced to uproot themselves, perhaps from around Heathrow, and move to a new area. In terms of Government engineering, I cannot see the case for that in a free society.

[Tracey Crouch (Chatham and Aylesford) (Con)]

I congratulate my hon. Friend on securing this important debate. Has he seen the report issued by the South East local enterprise partnership, which states that if we allowed our existing airports to expand, we could increase the number of jobs by about 100,000? That would generate in excess of £4 billion per annum.

[Mark Reckless]

Yes, I have seen that report, and I have a copy with me. Indeed, I encouraged Medway council, and through it the local enterprise partnership, to commission that excellent study. My hon. Friend and neighbour is right, and I will draw significantly on the analysis in that paper during my speech.

As well as the environmental issues, there is a knock-down argument against the Thames estuary airport: it is vastly more expensive to build a new airport than to expand existing provision. Recently, some of those issues have been revisited with Boris’s pie-in-the-sky proposals, whether for Boris island, for a Foster monstrosity over the Isle of Grain, or even to look again at the Cliffe option that was so unambiguously rejected. Some newer issues have come to the fore. For instance, there is the London Array wind farm, and billions of pounds of investment have been put into a major liquefied natural gas terminal. There is the Richard Montgomery, a sunken vessel laden with high explosives, which this Government—unlike the previous one—tell us about, and provide reports on, to clarify the risk. Furthermore, issues of air traffic control have become even more significant than they were 10 years ago, partly because of the expansion of Schiphol airport over that period.

I note from the Parsons Brinckerhoff report mentioned by my hon. Friend the Member for Chatham and Aylesford (Tracey Crouch) that Richard Deakin, the chief executive of the National Air Traffic Services, said that the proposed site for the new airport was

“directly under the convergence of major arrival and departure flight paths for four of London's five airports.”

Pointing to the Thames estuary on a map, he said:

“The very worst spot you could put an airport is just about here…We’re a little surprised that none of the architects thought it worthwhile to have a little chat with the air traffic controllers.”

--- Later in debate ---

[Mark Reckless]

Yes.

[Tracey Crouch]

There is an argument about competitiveness, and that argument is for today. Our colleagues are arguing that businesses in their constituencies require the opportunities now. Therefore we should be making the most of our existing airports, rather than waiting two decades for a new airport to be built to maximise opportunities.

[Mark Reckless]

I agree. There is huge scope for what my hon. Friend describes. It would hugely benefit not just the Medway towns and the south-east region, but the country as a whole.

I want to talk about one other area where the lobbyists have a certain position. I received a document yesterday from the Mayor of London, who tells me that he is delighted that I am having this debate. He says:

“France’s hub airport, Paris Charles de Gaulle (56 departures per week), has better connections to Brazil than Heathrow (27 departures per week).”

The reason is that we have a bilateral treaty with Brazil, with a current limit of 35 passenger services a week between the two countries. Again, that is vastly to the benefit of BA, which routes flights to Latin America, including Brazil in particular, through the joint hub that it now has in Madrid, through Iberia following the merger. We do not get pressure from BA to change that, because it hugely benefits its profits, but BA’s market capitalisation is in the low billions. The idea that our whole airline policy and the network of treaties negotiated by the previous Government should restrict those flights and prevent Brazilian or Chinese airlines from flying into our large cities is a huge mistake.