Diffuse Mesothelioma Payment Scheme

Debate between Angus Brendan MacNeil and Steve Rotheram

Wednesday 11th February 2015 Westminster Hall

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

It is a pleasure to serve under your chairmanship, Mr Owen. At the outset, may I welcome yesterday’s written statement from the Minister on behalf of Lord Freud? It goes some way towards addressing one of the central points that I wished to raise, but it also raises a host of points that require clarification. I hope that the Minister will be able to address those. I am certain that my hon. Friend the Member for Stretford and Urmston (Kate Green), who has led the campaign for fair compensation for sufferers, will also have a number of questions for the Minister, as will other Members.

As the honorary president of the Merseyside Asbestos Victim Support Group, I place on the record my thanks to the mesothelioma victim support groups up and down the country for their continued championing of victims and for the dignified and diligent manner in which they fight their cause. I should also make special mention of the late Paul Goggins, who did so much in this place to advance the cause of mesothelioma sufferers and without whom we would not have reached this advanced point.

To give credit where it is due, and so that I cannot be accused of being partisan, let me also say that the work of the hon. Member for Chatham and Aylesford (Tracey Crouch) should also be recognised. The Government’s U-turn should vindicate her steadfast support for victims of this dreadful disease. By the way, I suspect she might still be smarting from the result of last night’s match, when Liverpool secured a deserved victory over her beloved Spurs.

It is now eight months since the Mesothelioma Bill—now the Mesothelioma Act 2014—passed through Parliament. Given that Parliament will dissolve at the end of next month, I thought this would be an appropriate juncture for MPs to convene to discuss the status of the Diffuse Mesothelioma Payment Scheme. That, of course, was before yesterday’s announcement, but the issues before us are no less relevant for that.

Throughout my contribution, I wish to focus on two key points: the 3% levy and research funding. First, however, I would like to highlight the issues that remain outstanding after the Minister’s statement. The 2014 Act delivers the legislative framework for the Diffuse Mesothelioma Payment Scheme, which is a source of compensation for mesothelioma sufferers who could prove they were negligently exposed to asbestos at work, but who could not trace a relevant employer or that employer’s insurer. In addition, the scheme makes payments to eligible dependants of mesothelioma victims who have, sadly, passed away.

Originally, payments of 80% of the level of average civil claims were to be made in respect of people first diagnosed on or after 25 July 2012. The new guidance means that the uprating to 100% will include all those diagnosed from yesterday onwards but exclude those who have already lodged claims.

[Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)]

I congratulate the hon. Gentleman on holding this important debate, which is very much needed. I also welcome the change that the Government announced yesterday. He mentions the 2014 Act and those who were diagnosed on or after 25 July 2012, but some were, of course, diagnosed before then. A constituent’s husband died in November 2012, but she cannot get compensation because they fell outwith the claim period of a year. Does the hon. Gentleman think that that should be remedied, given yesterday’s changes and the Government’s more enlightened understanding of the issue?

[Steve Rotheram]

The case the hon. Gentleman highlights is similar to cases Members raised in Committee and on the Floor of the House when the issue was debated. It is for the Minister to respond to the question of what will happen to those diagnosed before the 2012 threshold.

The arbitrary nature of yesterday’s ruling caused great distress to a small group of about 250 claimants who already receive payments from the scheme. Will the Minister comment on the unjust nature of the anomaly created by Lord Freud? Instead of sticking to yesterday’s written statement, the Minister should stand up today and announce that he will backdate the increase to include victims who have successfully claimed at the lower, 80% rate during the scheme’s first eight months.

It is obvious that Lord Freud has had to take the action he has, because, as the Opposition predicted, the number of claimants has not reached the inflated figure the insurance companies came up with to make the compensatory package look punitive—the number is far smaller. Lord Freud admits:

“The number of claimants has proven to be below the level anticipated.”—[Official Report, 10 February 2015; Vol. 592, c. 42WS.]

Yes—a whopping 70% lower. He might put this down to the fact that insurers are only now tracing an increasing number of policies, but if we start with an overestimate of the number of claimants, we cannot simply put any decrease down to the fact that the industry has only belatedly got its act together and started tracing compensators for remedy.

It should not be forgotten that, over the life of this Parliament, pressure from mesothelioma campaigners has pushed the Government to increase compensation rates from the initial derisory offer of 70%, to 75%, then to 80% and now to 100% of the level of civil claims. I pay tribute to those resolute campaigners. The Labour party consistently called for an increase during the passage of the Bill, so I am delighted to see that increase come to fruition.

The scheme is funded by a levy on insurers that provide employers’ liability insurance. Throughout the passage of the Bill, the Government gave assurances that the levy would be set at a rate equal to 3% of the gross written premiums on employers’ liability insurance policies. Ministers told us that the insurance industry could afford to fund the scheme through a levy of 3% of GWP without having to pass on the costs to its customers through additional premiums. The expectation in the original impact assessment was that the levy on the industry would raise £338.7 million over 10 years.

In a ministerial statement on 28 November 2014, the Government announced that the levy would raise £32 million in the first year. That in fact represents a levy equivalent of just 2.2%, not the 3% originally agreed to and promised. That was due to the fact that the employers’ liability market accounted for GWP of £1,418 million in 2013—an increase of 4.8% on the previous year. From that figure, it is clear that a 3% levy would net £43.6 million, not the £32 million cited in the ministerial statement. The Department for Work and Pensions does not contest those figures, and it verified them at a meeting involving Lord Freud and the hon. Member for Chatham and Aylesford. I guarantee that, if the converse had happened and the take from the insurance pot at 3% had been lower than anticipated, the Government would not have argued to increase that percentage. Why, then, are they letting the insurance industry get away with a lower yield because the market has increased?

The issue is a cause of major concern, because the Government explicitly promised that the 3% target would be met in year 1. The importance of the additional 0.8% differential cannot be understated. If the Government chose to act, the additional £11.6 million difference could enable payments to be made to sufferers of other asbestos-related diseases, who are currently not covered by the scheme, or in respect of those diagnosed before the scheme was in place, such as the constituent of the hon. Member for Na h-Eileanan an Iar (Mr MacNeil). The additional £11.6 million could provide much-needed investment in medical research—something I will say more about shortly.

The Minister was not in his current post during the passage of the Bill; his predecessor, the right hon. Member for Hemel Hempstead (Mike Penning), was. The right hon. Gentleman declined, in Committee, to enact Labour’s proposal for the 3% levy to be enshrined in law. Instead, he gave Members a cast iron guarantee:

“I say to the shadow Minister, the hon. Member for Stretford and Urmston, that I met Lord Freud, my fellow Minister in the Department for Work and Pensions, this morning. Three per cent. is 3% and we have no intention of moving away from it.”––[Official Report, Mesothelioma Public Bill Committee, 12 December 2013; c. 117.]

He was unequivocal. What do they say about actions speaking louder than words? If the Government do not commit to ensuring that the insurance industry will meet the 3% levy target, they will leave themselves open to legitimate criticism from mesothelioma campaigners that they are on the side of the insurers, not the victims, and are letting insurers walk away from that cast iron guarantee. That is why we pushed for the 3% to be enshrined in law.

I should be grateful for answers to some questions. Why are the Government set to renege on the promise that they made to mesothelioma victims and Members of this House about the 3% levy? Given the present understandable uncertainty about whether the 3% levy figure will be met, will the Minister confirm whether the Government intend to amend the 2014 Act to enshrine it in law? If applications to the scheme increase steadily, as more people become aware of it, and claims exceed 3% of gross written premiums, will the industry pay out from the windfall that it gets from the underpayment it currently presides over? What work is the Minister doing with hospitals, colleges, surgeries and GPs to make those diagnosed with mesothelioma aware of the scheme, to encourage increased take-up? How much is his Department spending on promoting the scheme to sufferers?

I will remind the House—as if this were needed—of what a terrible disease mesothelioma is. Thankfully, it is not a common cancer, but according to Cancer Research UK it is responsible for 2% of all cancer deaths in the country. The latest statistics showed that there were 2,570 known cases, which was a rise on the previous 12 months, with 2,429 subsequent mesothelioma deaths in the same year. A victim is likely to live less than a year after contracting mesothelioma. The disease is commonly associated with men who have worked in heavy industry, such as the construction industry, which is why I am proud of the lead that my union, the Union of Construction, Allied Trades and Technicians, has taken on the issue.

Shrewsbury 24 (Release of Papers)

Debate between Angus Brendan MacNeil and Steve Rotheram

Thursday 23rd January 2014 Commons Chamber

[Steve Rotheram]

The hon. Gentleman should not think I am going to stand here and defend the indefensible. We had an opportunity when in government to do what we are asking for today, but we did not take it. However, that does not stop people continuing to campaign and trying to persuade the Government—no matter what colour—that that is the right thing to do. That is what we are doing today.

[Mr MacNeil]

Is there another consideration, because since previous Lord Chancellors considered the issue and refused to release the papers more research has come forward from campaigners that now makes it more materially important to release the papers and be transparent?

[Steve Rotheram]

That is a good point, and as things develop more and more information is known. Some further information has been gathered by Eileen Turnbull, and I am sure other Members will refer to that in their contributions.

On 20 September 1972, a letter was sent to all NFBTE regional secretaries around the country from its head office in London. It was headed “Intimidation Dossier”. The dossier was presented to the Home Secretary, Robert Carr, who had previously been Secretary of State for Employment and overseen the introduction of the contentious Industrial Relations Act 1971. Out of 85 instances of alleged intimidation and violence detailed in the dossier, only six related to north Wales. Despite the undeniable fact that most incidents occurred elsewhere, the Home Secretary instructed the chief constables of West Mercia and Gwynedd police forces to carry out an inquiry into picketing in north Wales during the strike. Let us not forget that, as was said earlier, none of the pickets was cautioned or arrested on the day, the unions did not receive any complaints from the police about the conduct of the pickets, and photographic evidence shows that the police were present and mingling freely with strikers. Some police had their hands in their pockets—hardly intimidation.

We now know that of the 900 statements taken, 600 were disregarded by the authorities, presumably because they failed to corroborate what the police hoped they would say. On 11 October 1972, Robert Carr told this House that in his opinion there was no deficiency in the law as it stood, and the problem lay with enforcement. In other words, he was pressuring the police who he believed had failed to do their job properly. A few days later, the then Attorney-General, Sir Peter Rawlinson QC, gave a speech to the Tory 1922 committee in which he used strikingly similar language. Following that, we know that of the 200 or so pickets identified, just 24 were carefully selected for a political show trial at Shrewsbury Crown court, and charged with the offence of intimidation under section 7 of the Conspiracy and Protection of Property Act 1875.