Skip to main content

Iraq-Kuwait Conflict: Compensation

Volume 460: debated on Thursday 24 May 2007

To ask the Secretary of State for Foreign and Commonwealth Affairs what her estimate is of the outstanding amount of interest accrued by delays in the payment by the UN Compensation Commission of compensation relating to the detention of UK nationals in Iraq during the first Gulf war. (137444)

A decision was taken at the 55th session of the UN Compensation Commission (UNCC) Governing Council in March 2005 that interest would not be paid by the UNCC to claimants on top of their principal awards. This decision was made for a variety of reasons, including the fact that assumptions made about the capacity of the Compensation Fund (its revenue generated from Iraqi petroleum export earnings) did not materialise which resulted in inadequate funds being available, and the estimated projection that payment of all principal awards would not be completed until 2045.

The decision was taken against the background of the need for Iraqi oil proceeds to be used towards reconstruction of Iraq. Payment of interest would place an additional and unacceptable financial burden on the Iraqi people.

No outstanding interest therefore accrued in the period between determination and payment of awards.

A letter was sent by the Foreign and Commonwealth Office to all UK claimants in March 2005 explaining the decision taken on the question of interest by the Governing Council.

To ask the Secretary of State for Foreign and Commonwealth Affairs if she will raise the issue of interest accrued during delays in the payment by the UN Compensation Commission (UNCC) of compensation relating to detention of UK nationals in Iraq during the first Gulf war at the next meeting of the UNCC's Governing Council. (137445)

A decision has already been taken by the UN Compensation Commission (UNCC) Governing Council at its 55th session in March 2005 that interest will not be paid by the UNCC to claimants on top of their principal awards. This decision was made for a variety of reasons, including the fact that assumptions made about the capacity of the Compensation Fund (its revenue generated from Iraqi petroleum exports earnings) did not materialise, which resulted in inadequate funds being available, and the estimated projection that payment of all principal awards would not be completed until 2045.

The decision was taken against the background of the need for Iraqi oil proceeds to be used towards reconstruction of Iraq. Payment of interest would place an additional and unacceptable financial burden on the Iraqi people.

A letter was sent by the Foreign and Commonwealth Office to all UK claimants in March 2005 explaining the decision taken on the question of interest by the Governing Council.

To ask the Secretary of State for Foreign and Commonwealth Affairs how many payments to UK nationals from the UN Compensation Commission relating to detention in Iraq during the first Gulf war have been subject to delay; and what the average length of this delay was. (137446)

Individuals claims had to be filed with the UN Compensation Commission (UNCC) by 1 January 1995; corporate and government claims by 1 January 1996. 5,000 UK claimants duly received awards from the UNCC totalling US$ 428 million.

The Foreign and Commonwealth Office was initially unable to locate 47 of the successful UK claimants on the basis of information provided by the UNCC. However, following renewed efforts in 2006, we subsequently located 26 of the 47 and are currently in the process of finalising the payment of their outstanding awards.

To calculate the average time between the lodging of the 5,000 UK claims and the payments (made in instalments) could not be done without incurring disproportionate cost.

To ask the Secretary of State for Foreign and Commonwealth Affairs what discussions she has held with the UN on (a) payments to UK nationals relating to their detention in Iraq during the first Gulf war from the UN Compensation Commission which were delayed and (b) the interest accrued during these delays. (137447)

My right hon. Friend the Foreign Secretary has not had any discussions with the UN about delayed payments to UK nationals from the UN Compensation Commission relating to their detention in Iraq, and the interest accrued.

We are aware, however, that in some cases claimants may face difficulties in making such repayments, and we will handle these with due concern for their welfare.