Mesothelioma Bill [Lords]

Steve Rotheram Excerpts

Monday 2nd December 2013 Commons Chamber

[Kate Green]

Four years certainly seems a remarkably short period over which to cost the scheme, given the many decades over which the industry expects it to continue. It is a concern—one that we will discuss further in Committee—that the figures seem to have changed since the Bill moved from the Lords to the Commons, and changed back again, in a manner that might be said to favour a particular outcome that suits the industry. We will want to question that in more detail when considering the range of figures being presented.

While the Bill has been proceeding, the Ministry of Justice has been consulting on its proposals to expedite and streamline the process for taking legal action, and to introduce fixed fees for mesothelioma cases, and we have real concerns about the MOJ’s plans for the fate of the scheme before us. Evidence suggests that fixed fees are likely to exert a downward pressure on the level of civil damages, notwithstanding the 10% uplift in damages that has not yet been applied to mesothelioma suffers under the Legal Aid, Sentencing and Punishment of Offenders Act 2012. Indeed, our suspicions are borne out by the view of the insurance industry that this Bill and the MOJ process should be seen as part of a single package.

I recognise that the Minister cannot answer for changes that the MOJ will make to court rules, but it is of concern that there will be no parliamentary scrutiny of those changes. I warn him that as the Bill proceeds we will seek assurances that the MOJ’s actions will not adversely affect the scheme in the Bill. Moreover we should remember that these already quite meagre payouts, which are already to be reduced by benefits recovery, will be further depleted by legal fees and fees for medical certificates. We are anxious that the deal looks less and less good for sufferers, and we will return to those points in Committee.

As has been noted, hundreds of sufferers will lose out because the scheme does not take effect until 25 July 2012, which was when the Government published their response to the consultation set up in 2010 under Labour. Although I recognise the time spent by Ministers in detailed negotiations with the industry, we must recognise that between February 2010 when the consultation opened and July 2012, more than 700 people will have died without access to justice. We therefore believe there is a strong argument for the earlier start date of February 2010, and we do not think it credible to suggest that an industry whose very purpose and lifeblood is the anticipation and management of risk has not been preparing for the likely introduction of a scheme such as this since the date of the initial consultation.

As the debate in the House of Lords exposed, this is not a matter of insurers reserving policy—I accept that a more rigorous framework might apply to provision for risk—but a simple matter of business planning. Surely it would have been prudent for insurers to have assumed from 2010 that there would be a payment system with which they would be required to comply, and to have made provision for best and worst-case scenarios. That, too, is a matter we expect to explore further in Committee.

I am sure the Minister will assert that there is a cost to the industry of an earlier start date, and I hope we will have some definitive figures for that. Lord Freud said the costs at 100% of civil damages would be £119 million, and he undertook to calculate figures at the lower percentage—then 70%—introduced by this scheme. It would be helpful to know from the Minister before we go into Committee what progress has been made with those calculations at the level now proposed of 75%.

[Steve Rotheram (Liverpool, Walton) (Lab)]

My hon. Friend, quite rightly, points out the faux concerns about cost and affordability. Does she agree that insurers are not doing this out of the goodness of their heart? For many years, they received payments for exactly this eventuality, and they should therefore be made to compensate those who are now sufferers.

[Kate Green]

I can only agree with my hon. Friend, and I hope the industry does not assume that the House will let it get away with the minimum it can propose. I assure the House that the mood of many colleagues from all sides is determinedly that we should do the best we can for victims—we and the industry owe them that.

As I think the Minister has alluded to, there is also a debate to be had about the scope of the Bill. It will exclude the self-employed unless they can determine they were de facto employees, and exclude family members who may have been contaminated—for example because they washed a brother’s or husband’s overalls. It will cover only mesothelioma and exclude all other asbestos-related illnesses. I heard what the Minister said about that, and again, I hope we can explore that issue further in Committee. Lord Freud offered welcome assurance about Ministers’ intentions in relation to other forms of asbestos-related disease when the Bill passed through the House of Lords, and I hope we will be able to secure firm commitments from the Minister on that.

--- Later in debate ---

[Mr Wright]

Any cut-off date will be arbitrary. We just want compensation for victims in our constituencies. That issue will have to be explored, and I hope it is explored at length in Committee.

Secondly, I am concerned about the fact that only diffuse mesothelioma is included in the scheme. Workers have contracted a variety of diseases as a result of exposure at work, including pleural plaques and asbestosis. It is not good enough that only one, narrowly defined condition can be included. Again, I hope that the Minister will amend that in Committee.

My third point was touched on by the shadow Minister, my hon. Friend the Member for Stretford and Urmston (Kate Green), and by the hon. Member for Chatham and Aylesford (Tracey Crouch). I have great concerns about the fact that clause 2 confines the scheme to those employees who were employed at the time of exposure. In Hartlepool I have had at least two cases—I referred to one earlier—in which the wife of a worker developed pleural plaques, then asbestosis and then mesothelioma as a result of washing her husband’s work clothes, which released the fibres and allowed them to enter her lungs. Those women—there are probably many more—suffered and died as a direct result of asbestos exposure caused by an employer. Surely it is only fair and just that they should be included in the scheme. I hope that the Government will accept that secondary exposure is an important part of what the Bill should provide for.

The third way in which the Bill must be improved relates to the amount of compensation provided. We have heard time and again from hon. Members on both sides of the House that the payments will be only 75% of the value of civil claims. That really is a mean-spirited and petty act from the Government against people facing a terrible, terminal disease. There can be no possible justification for the scheme paying less than 100% compensation. Why should victims in Hartlepool miss out on what could be several thousand pounds in compensation, which could provide a little dignity and comfort in their final days or—let us be frank—provide their families with the money to bury them, just because a deal has been struck with the insurance industry, an industry that might have lost or destroyed the policies for which they took the cash from those employees in the first place? Let us be under no illusions: the insurance industry has got a hell of a good deal out of this Government and out of this Bill.

[Steve Rotheram]

I am president of the Merseyside Asbestos Victims Support Group. I know from the people I have spoken with—I am sure that the same is true in my hon. Friend’s constituency—that most victims want the recognition that someone is being held accountable for their suffering or that of their loved ones. The financial compensation will help them in their last days or alleviate the financial hardship that losing them, perhaps the breadwinner, might bring to their family.

[Mr Wright]

My hon. Friend makes such an important point. My constituents are victims. They have done nothing wrong. They just tried to do a good day’s work for a good day’s pay. They did not want the trauma and tragedy that exposure to asbestos caused. It is the negligent employers who should be held accountable for that negligence.

The insurance industry should have a key role to play but—let us be honest—has been let off. It has negotiated a scheme that excludes approximately half of all asbestos victims, it can ignore liability for all claims prior to 25 July 2012, its costs are reduced because the average compensation agreement will mean that individually negotiated and assessed costs will not have to occur, and the fault is laid at the door not of negligent employers, but of victims.

On top of all that, the insurance industry is planning to reduce average compensation by 25%, compared with civil cases, and the Government are giving insurers £17 million to set up the scheme. Given that employers’ insurance was compulsory from 1972, the insurance industry has already received the premiums from firms and banked the cash for over 40 years. It has had the money, so now it is time for the victims to receive their fair share.

The insurance industry must have seen the Government coming. The Government have been rolled over by the industry. As a result, my constituents will miss out on justice and compensation at precisely the time in their lives when they need it most. For far too long we have let those people down. My constituents have been let down by a failure to act quickly. The Bill is a step forward, but it does not go far enough for victims of this horrific disease in Hartlepool and elsewhere.

--- Later in debate ---

[Steve Rotheram]

My hon. Friend mentions the part that the Labour movement has played, but there is also the part played by the insurance industry, which has abrogated responsibility from day one and kicked back at every single push that the unions and the Labour movement have made. Does he see any parallels between large industries such as the insurance industry and construction industry that have failed to take responsibility for things they have done such as blacklisting and, much worse, possibly killing people through their irresponsible behaviour?

[Ian Lavery]

I have been involved for many years in trying to claim compensation for people in work, whether from insurance companies or employers, and it has always been a difficult challenge because they try to abrogate their responsibility at every opportunity. They try to run away from it and to put as many obstacles in the way of any form of compensation as they possibly can. Unfortunately, that is how they operate.

Thank goodness we have trade unions that stand up for individuals who are hurt and who suffer from prescribed diseases such as mesothelioma and other asbestos-related diseases, industry-related diseases and injuries at work. Thank goodness that ordinary people have behind them the security of trade unions, which have the finance at least to try to get the compensation that lots of families should have had.

I welcome the scheme as a massive move forward, but I hope that we can come together in Committee and iron out a few major problems. I will mention four items of concern, but that is not to say that there are not others: first, the level of the percentage payment; secondly, the exclusion of other asbestos-related diseases; thirdly, the cut-off date of 25 July 2012; and, lastly, the claw-back of 100% of DWP benefits when the Bill provides for payment at only 75%—a point raised by my hon. Friend the Member for Middlesbrough (Andy McDonald).

On the level of payment, why should anybody who will have two years to live, max, be happy with 75% of any compensation? These people are dying.