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New Clause 1 - Establishing additional schemes

Mesothelioma Bill [Lords] – in a Public Bill Committee at 3:00 pm on 12th December 2013.

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‘The Secretary of State shall within a year of this Act being brought into force, prepare and lay before each House of Parliament a report setting out the Government’s proposals with regard to the establishment of additional schemes for asbestos-related industrial diseases, as prescribed under the Pneumoconiosis etc. (Workers’ Compensation) Act 1979, where there are unresolved insurance disputes.’.—(Kate Green.)

Brought up, and read the First time.

Photo of Kate Green Kate Green Shadow Minister (Work and Pensions)

I beg to move, That the clause be read a Second time.

Photo of George Howarth George Howarth Labour, Knowsley

With this it will be convenient to discuss new clause 7—Establishing additional schemes: pleural plaques—

‘(1) The Secretary of State shall, within twelve months of any scheme under this Act being implemented, prepare and lay before each House of Parliament a report assessing the costs and benefits of extending the scheme to—

(a) eligible people with pleural plaques; and

(b) eligible people with other asbestos-related industrial diseases where there are unresolved insurance disputes.’.

Photo of Kate Green Kate Green Shadow Minister (Work and Pensions)

Throughout our deliberations on the Bill, there has been discussion of opportunities that may or may not exist to extend the scheme in a number of ways. New clause 1 simply deals with the possibility of extending it, or additional schemes, to other asbestos-related diseases. New clause 7, which has been tabled by my right hon. Friend the Member for Newcastle upon Tyne East and on which I will speak in a moment, relates specifically to the extension of a scheme to eligible people with pleural plaques.

New clause 1 asks not that an extension to other asbestos-related diseases be encompassed into the scheme provided for in the Bill, but that the Minister lays a report before Parliament within 12 months, explaining exactly what the Government intend to do and will be able to do about extending a payments scheme to a wider range of asbestos-related diseases. We recognise that the long and short titles of the Bill would exclude the possibility of doing that in this Bill, but we are also aware that there have been encouraging indications from Lord Freud and others that the Government have not ruled out the possibility of extending some other form of payments system to other asbestos-related diseases.

We do not believe that there would be a moral reason against doing such a thing. We have heard some powerful contributions, for example from my hon. Friend the Member for Wansbeck and from the hon. and learned Member for Sleaford and North Hykeham, about how people have often incurred mesothelioma while going about their daily work. The same is true of other horrible asbestos-related diseases.

On Second Reading in the House of Lords, Lord Freud said:

“The Bill does not—and cannot—look to respond to all asbestos-related disease.”

However, he went on:

“The issue of individuals who have developed other asbestos-related diseases through negligence or breach of statutory duty and are unable to bring a civil claim for damages of course needs to be addressed.”—[Official Report, House of Lords, 20 May 2013; Vol. 745, c. 690.]

I hope that the Minister will be able to provide stronger assurances about the Government’s intentions in that regard. The Government’s impact analysis states that

“extending the scheme to include other asbestos related diseases would result in approximately 4,500 extra successful applicants to the scheme. This would increase the levy by approximately £470m.”

That would effectively double the levy over 10 years. The Asbestos Victims Support Groups Forum UK strongly believes that the logic and assumptions used to arrive at that calculation are significantly flawed. Its briefing, which I am sure the Minister has seen, suggests that such an extension would add only 20% to the costs of the current scheme. The organisation states:

“This analysis is ill-researched and wholly misleading.

The author of the Analysis acknowledges that the assumptions made in the analysis are not appropriate, but because of supposed lack of evidence she relies on the inappropriate assumptions to provide an estimate of the impact of extending the scheme.

Evidence is available and we have referred to some sources below. There is no excuse for failing to cite evidence which is so easily available.

We believe her analysis should be withdrawn and a properly researched analysis should replace it.”

The organisation highlights flaws in a significant number of assumptions: the failure to distinguish the success rate for mesothelioma claims from that of claims for other occupational diseases; the failure to recognise that other asbestos-diseases, on average, attract considerably lower levels of average compensation; the failure to take into account the view that asbestosis and pleural thickening diagnoses may have already reached their peak, unlike mesothelioma, which is predicted to spike in 2015, and therefore the number of claims over the 10-year impact assessment period are likely to diminish; and finally the assumption about the average payment per claim, which the ad hoc analysis concludes will be the same value as mesothelioma payments, at £87,000. In the words of the Asbestos Victims Support Groups Forum UK, “this is preposterous”. Using its own evidenced assumptions, the organisation has conducted an impact assessment. It found the cost during the lifetime of the 10-year impact assessment to be £77 million, some £400 million less than the cost identified in the Government’s impact assessment. That is on the cusp of being affordable within the existing scheme if we accept, as I suggested earlier, that a 3% levy should raise £471 million.

Even if the administrative costs were doubled to allow for wider-ranging or new schemes—that is not included in the Asbestos Victims Support Groups Forum UK analysis—the costs incurred would be only £131.6 million, which is far below those quoted in the Government’s impact assessment. An additional 2,268 people would benefit, which is almost double the number of beneficiaries of the current scheme.

The Opposition are surprised that the Government have used such speculative figures when other, more reliable, figures are readily available from the UK asbestos working party, a working group of the Institute and Faculty of Actuaries, which is not famed for its speculative approach to statistics. Given that the criticisms made by the Asbestos Victims Support Groups Forum UK of the Government’s analysis were sent to the Department on 4 December, I am puzzled why they have not been incorporated or at least addressed in the latest ad hoc analysis published on 6 December.

I invite the Minister to commit to reviewing the figures in the latest impact assessment and providing a detailed response to the concerns and assumptions of the Asbestos Victims Support Groups Forum UK and the figures produced by the UK asbestos working party. I recognise that that, in and of itself, will not bring other asbestos-related diseases within the ambit of the Bill. Given that the Minister has been willing to give a strong assurance of the Government’s intention in relation to other asbestos-related diseases, a proper cost estimate of such an extension would be helpful to all parliamentarians.

Photo of Nick Brown Nick Brown Labour, Newcastle upon Tyne East 3:15 pm, 12th December 2013

I shall speak to new clause 7, tabled in my name.

I would love to be able to assume that the Minister’s general assurance on looking at other asbestos-related conditions embraced, in its generosity, a commitment to look again at pleural thickening and pleural plaques, but that would be an unwise assumption—unless he wants to intervene and say something now. I see that he does not, although I would happily give way if he did.

I identify myself with everything my hon. Friend the Member for Stretford and Urmston said in moving new clause 1. My new clause deals with something different and specific: pleural thickening and pleural plaques. Prior to 2007, it was possible, if the victim could find an employer and an insurer, to sue in common law for pleural plaques. Indeed, people were able to obtain substantial settlements for pleural plaques.

It might help the Committee if I set out the distinction between pleural thickening and pleural plaques, and mesothelioma. The two things have a common cause: asbestos fibre getting into the lung, with the body’s defence mechanism responding by hardening around the fibre or the fibre’s causing scarring on the lung. That is the pleural thickening or the pleural plaque. It does not, however, of itself—this is a common misconception—go on to develop into full-blown mesothelioma and that form of lung cancer.

I often find myself explaining that to constituents, because they are not just unsure, but confused and frightened, and worried that because they have been diagnosed with pleural plaque, their life expectancy has been dramatically reduced. Such a diagnosis does not necessarily mean that. It does mean, however, that they have been exposed to asbestos dust, and worry and anxiety that come with that are very real. It also means that they may have developing within them some other condition, because of the exposure to the dust.

The number of cases is substantially greater than the number identified with mesothelioma. The annual number of cases of pleural thickening, assessed for industrial injury disablement benefit, has more than trebled since 1991, reflecting changes in the criteria for compensation and the number of new cases annually. There were 460 such cases in 2012, compared to 150 in 1991. Between 1998 and 2012, nearly 15,000 cases of pleural disease were confirmed by chest scans, but there is no direct or precise estimate of the current prevalence of pleural plaques in the UK, because people would need a scan to confirm the diagnosis. However, in absolute terms, the condition is likely to be common, with one expert suggesting that as many as 36,000 to 90,000 people a year may be developing plaques. That is one expert’s estimate, and it can only be an estimate.

The question is: should people with this condition be entitled to any form of remedy at all? No person asked to be given such a thing. People get it by exposure to asbestos. Until 2007, it was possible to take a common-law case to gain compensation. That was fought by the insurers, all the way up to the House of Lords. In the decision of Rothwell v. Chemical and Insulating Co Ltd, which became the definitive case, all future such awards were stopped.

I am not telling tales out of school, Mr Howarth; you will remember this. There was a huge campaign in the Labour party when we were in government to try to get some compensation for the victims of pleural plaques. The settlement arrived at after strongly argued discussions among colleagues and friends was that those who had made claims prior to the decision would get something—the reasoning was that they had some limited expectation of success, so it would be wrong to have their hopes struck down—but that there could be no future expectation. I disagreed with the settlement then and I disagree with it now.

It is unfair that people who did not ask for the condition—the condition having been inflicted upon them without their consent—should be denied any form of redress. Had they been inflicted with an external condition, such as facial scarring rather than scarring on their lungs, they would be entitled to compensation. In any event, it is unreasonable to say that people may be inflicted with something to which they never agreed and that is bound to worry them and be a cause of distress. Moreover, the condition is an indication of exposure to asbestos and therefore results in an enhanced likelihood—we can argue about the degree of enhancement —of developing a much more serious asbestos-related condition that is almost invariably fatal.

The feeling about that in the north-east of England is very strong. Every single Member of the previous Parliament from the region—I know the region is overwhelmingly Labour—committed themselves to a campaign to secure justice for the victims of pleural plaque.

The forecasts for sufferers of mesothelioma, which we discussed earlier, are all we have to guide us. I have no quarrel whatever with the public servants and the specialists who put together those forecasts. I am sure they have done their best, but within those figures there are, as we discussed in relation to a previous clause, a substantial number of variants. The figures cannot be absolutely relied upon, and in any event, we know that the profile of victims will be different in the coming decade from the past decade.

In the past decade communities and regions, such as the one I represent, with a preponderance of heavy engineering, shipbuilding and every single industry from thermal insulation and lagging to railway-related industries, in which asbestos was sprayed as a fire retardant with limited protection for the operatives involved, had the historical cases. My view is that future cases will be more broadly spread. We will find cases among members of the teaching profession who put pins into asbestos-clad boards and people in the construction sector who drilled into asbestos plates. At one stage, asbestos was used as a construction material for outbuildings, which were assembled by drilling into the asbestos. Victims from such industries will be coming through in the future. They will not have shown up yet, and we do not know just how many there are. I hope the predictions are correct and that the public safety measures for which the House voted have effect, but if those measures have been more honoured in the breach, or if the condition is more prevalent than the assessors say, we will have a rising profile, or at least a steady profile, of mesothelioma cases. There is no reason whatever why the profile of pleural plaque and pleural thickening cases will not follow the same broad trend.

People with such conditions are our fellow citizens. An injury for which they did not ask and that they did not want has been inflicted upon them. There should be a straightforward, simple and proportionate remedy for their condition. My new clause invites the Minister to do no more than think about it. I hope he will think about it.

Photo of Mike Penning Mike Penning The Minister of State, Department for Work and Pensions 3:30 pm, 12th December 2013

I thank the right hon. Gentleman for a very thoughtful speech on behalf of his constituents and many others, not just in the north-east. As he said,  there will be sufferers across the country. I had the sad honour the other day of having a discussion on Radio 2 with a relatively young man who had lost his wife when she had done no more than be a teacher who wanted to make the classroom look wonderful for her pupils. She had died of mesothelioma.

As the shadow Minister said, the long title and short title of the Bill are quite defined. It is important that that is understood. However, Lord Freud made understandable commitments in the other place to work with other Departments, researchers and groups to develop better information and analysis, so that other groups could be as defined as the groups in the Bill, and also get compensation from a fund of last resort if has to happen, although we all hope that would not be the case. I reiterate that here today.

Lord Freud, Lord Howe, who spoke movingly in Committee in the other place, and I work closely together. Although the right hon. Member for Wythenshawe and Sale East has left for understandable reasons, this is where the research becomes so important. The reason why the Bill has got so close to getting the money to those who desperately need it is that the research and analysis were definitive.

I pay tribute to the Asbestos and Mesothelioma Support Group. We do not always agree on the figures, but we all agree on one thing. We need to get help in this case. We will work together. That is the commitment that the shadow Minister wanted. We will try to get our figures as close to theirs as possible. I am willing to work with anybody who can come forward and show us a way to get help to people who are not getting it from any other source.

Photo of Kate Green Kate Green Shadow Minister (Work and Pensions)

I am grateful for much of what the Minister has said about the new clause. Could he share how he intends to keep the House informed of the progress of the work? My new clause proposes a report within one year to Parliament, but I am open to other suggestions from the Minister.

Photo of Mike Penning Mike Penning The Minister of State, Department for Work and Pensions

I hope I have already indicated to the Committee and made a commitment that the way the fund is working will be reported to Parliament each year. I do not want it to be complicated or to be full of gobbledegook. It has got to be nice and simple. We will take a similar path with the report.

Both the hon. Member for Stretford and Urmston and the right hon. Member for Newcastle upon Tyne East made really good points. However, the shadow Minister indicated at the start of her comments that she would withdraw the new clause.

Photo of Kate Green Kate Green Shadow Minister (Work and Pensions)

I welcome a great deal of what the Minister said. He acknowledged that we already have his commitment to an annual report to Parliament in relation to the diffuse mesothelioma payment scheme. I think I heard him say that there would be a similar commitment to progress on identifying the possibility of extending schemes to other asbestos-related diseases, though I do understand the issues that he raised.

Photo of Nick Brown Nick Brown Labour, Newcastle upon Tyne East

Since I understood the Minister’s remarks to embrace my new clause as well, I will not press it.

Photo of Kate Green Kate Green Shadow Minister (Work and Pensions)

I beg to ask leave to withdraw the new clause.

Clause, by leave, withdrawn.