Good news for mesothelioma victims, but Government windfall of £63 million is a bitter pill

Those mesothelioma victims who will soon be able to claim compensation under the provisions of the new Mesothelioma Act received some good news this week, when the Department of Work and Pensions announced that as a result of reduced administration costs related to the running of the new compensation scheme, victims will now receive an extra £8000, bringing the expected average payments to £123,000.

Government figures suggest that ultimately around 3500 victims will benefit from the new compensation scheme, which enables those former employees negligently exposed to asbestos by their employer, but who are unable to sue their former employer as they are no longer in business and no insurance policy can be found, to receive money from the insurance industry funded scheme.

When the Mesothelioma Act was going through the House of Commons, the government resolutely refused to raise the level of payments above 75% of the average level of payments received in successful civil claims. Whilst the announcement raising the level of payments is to be welcomed, it does raise some questions over how the government have constructed the scheme. The savings that have enabled the extra  money to be paid are coming from a lower than expected tender for the running of the scheme. The contract has been awarded to Gallagher Bassett. A quick calculation show that the saving is £28 million, which is quite frankly a staggering figure, and suggests the government were either negligent in their calculations, or deliberately over budgeted the forecast administration costs in order to be able to triumphantly raise the payment levels subsequently.

The government besides being robust in their earlier rejection of a higher pay out than 75%, were also robust in rejecting a levy to create research funds that have been so desperately needed for mesothelioma research. The government themselves are going to benefit from this scheme to the tune of at least £63 million. How? Quite simply, victims such as those who will now be claiming under the new scheme will no longer be making claims under the statutory Pneumoconiosis (Workers Compensation) Scheme funded by the government. Average payments under this scheme are about £18,000. Therefore 3500 x £18,000 = £63 million.

This money should be ring fenced and made available for research into mesothelioma.  If this government truly care about mesothelioma victims, as they have tried to claim, then they should do the right thing.

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