Motion to Approve
That the draft Regulations laid before the House on 15 January be approved.
My Lords, I will speak also to the Pneumoconiosis etc. (Workers’ Compensation) (Payment of Claims) (Amendment) Regulations 2019. I am required to confirm to noble Lords that these provisions are compatible with the European Convention on Human Rights and I am happy so to do.
These statutory instruments will increase the value of lump-sum awards payable under the Pneumoconiosis etc. (Workers’ Compensation) Act 1979 and the diffuse mesothelioma scheme, which was set up by the Child Maintenance and Other Payments Act 2008. These two schemes stand apart from the main social security benefits uprating procedure. However, through these statutory instruments we will increase the amounts payable by the September 2018 consumer prices index rate of 2.4%. This is the same rate that is being applied to industrial injuries disablement benefit and certain other disability benefits, and under the main social security uprating provisions. These new amounts will be paid to those who satisfy all the conditions of entitlement, for the first time, on or after 1 April 2019.
Turning to the purpose of the lump-sum schemes, the Government recognise the great suffering of individuals and their families as a result of exposure to asbestos or certain other forms of dust. They may be unable to bring a successful claim for civil damages, due mainly to the long latency period of their condition, but can still claim compensation through these schemes. Although improved health and safety procedures have restricted the use of asbestos and provided a safer environment for its handling, the legacy of its common use is still with us. That is why we are ensuring that financial compensation from these schemes is available to those affected.
I will briefly summarise the specific purpose of the two compensation schemes. The Pneumoconiosis etc. (Workers’ Compensation) Act 1979—which for simplicity I shall refer to as the 1979 Act scheme—provides a lump-sum compensation payment to individuals who have one of five dust-related respiratory diseases covered by the scheme, and who are unable to claim damages from employers which have gone out of business and have not brought any action against another party for damages. The five diseases covered by the 1979 Act scheme are: diffuse mesothelioma, bilateral diffuse pleural thickening, pneumoconiosis, byssinosis, and primary carcinoma of the lung, if accompanied by asbestosis or bilateral diffuse pleural thickening. The 2008 mesothelioma lump-sum payments scheme, which I will refer to as the 2008 scheme, was introduced to provide compensation to people who contracted diffuse mesothelioma but were unable to claim compensation under the 1979 Act because, for example, they were self-employed or their exposure to asbestos was not due to their work. But the 2008 scheme, as many noble Lords know, allows payments to be made quickly to people with diffuse mesothelioma at their time of greatest need. Under both schemes, a claim can be made by a dependant if the person with the disease has died before being able to make a claim.
Payments under the 1979 Act scheme are based on the age of the person with the disease and their level of disablement at the time they are diagnosed. The highest amounts are paid to those diagnosed at an early age and with the highest level of disablement. All payments for diffuse mesothelioma under the 1979 Act scheme are automatically made at the 100% disablement rate, the highest rate of payment, reflecting the seriousness of the disease. Similarly, all payments under the 2008 scheme are made at the 100% disablement rate and based on age, with the highest payments going to the youngest people with the disease. In the last full year, April 2017 to March 2018, 3,680 people received payments under both schemes, totalling just under £50 million.
I know that in previous debates on increasing the value of these lump sums, noble Lords have raised the subject of equalising the payments made to dependants who claim after the death of someone who had the disease with those made to people who have the disease and claim in their lifetime. However, I must tell noble Lords that we do not intend to equalise payments. The Government’s view remains that it is most important that the available funding is given to the people with the condition who would most benefit from it. Of course, I fully understand that whole families can be devastated by this disease, but there is still the recognition that they are able to get compensation, even if it is not at the same level. When we have to make such decisions about how we use our limited resources—the taxpayers’ money that is available—we believe it is only right that we target that money by giving it to the people to whom it can make the most difference.
I am aware that the incidence of diffuse mesothelioma is a particular concern of noble Lords. The number of deaths in Great Britain remains at a historically high level. Diffuse mesothelioma has a strong association with exposure to asbestos, and current evidence suggests that around 85% of all mesotheliomas diagnosed in men are attributable to asbestos exposures that occurred through work. Those diagnosed with diffuse mesothelioma usually have a short life expectancy, with many people dying within 12 months of diagnosis. The number of cases currently occurring reflects the long latency period of the disease, which means that 30 years or more can pass from the time of exposure to the disease becoming apparent. The latest available information suggests that there will continue to be around 2,500 diffuse mesothelioma deaths per year before the number of cases begins to fall during the next decade, reflecting a reduction in asbestos exposure after 1980.
I turn to wider improvements in lung health. Although we expect the number of people diagnosed with mesothelioma to begin to fall in the coming years, the Government are well aware that many people will still develop this and other respiratory diseases in the coming years. That is why we are committed to working with our agencies and arm’s-length bodies to improve the lives of people with respiratory diseases.
In the recently published NHS Long Term Plan, the Government have identified respiratory diseases as a clinical priority. The long-term plan sets out how the NHS will take action in a number of areas, including expanding programmes that support earlier diagnosis of respiratory diseases, such as pioneering lung health checks, trialled in the north-west of England; and increasing access to proven treatments such as pulmonary rehabilitation. Furthermore, an NHS England respiratory oversight group has been created, which includes membership from the British Lung Foundation. Additionally, the NHS has been working closely with the Taskforce for Lung Health, which recently published its own lung health five-year plan.
Specifically on mesothelioma, the Government have committed to driving research activity forward. The National Institute for Health Research has led work which resulted in the funding of five studies, the first of which was completed last year. The Department of Health and Social Care is also a key stakeholder in the British Lung Foundation’s mesothelioma research network, which aims to improve outcomes for people affected by mesothelioma. Funding continues to be available from a variety of sources, including the National Institute for Health Research, the Medical Research Council and medical research charities.
Returning to these important regulations, I am sure we would all agree that while no amount of money can ever compensate individuals and families for the suffering and loss caused by diffuse mesothelioma and the other dust-related diseases covered by the 1979 Act scheme, those who have them deserve the monetary compensation that these schemes can offer. I commend the increase of the payment scales for these schemes and respectfully ask noble Lords’ approval to implement them.
My Lords, I thank the Minister for explaining these two important orders. I think this is her first time speaking on these matters. I do not know whether it is the first time on the Floor of Chamber but it may be, because these orders are usually taken in Grand Committee—I know that the noble Lord, Lord Jones, was keen that they should be debated here. I am sure the whole House welcomes the uprating that she announced, but has the time not come for this to be automatic rather than at the discretion of the Government, as there is no way the schemes will be wound up in the next few years?
My first time speaking on the mesothelioma order was 11 years ago, when I learned about its long latency period and the fact that some of the people affected, such as family members, did not work directly in industrial processes using asbestos. Subsequently, I knew a man who was diagnosed when he was over 80, his condition probably a result of national service in the Navy.
This was to lead me to ask the Minister about much-needed and hitherto neglected research, but she has spoken about that and I am glad that we have learned a lot more about it. I think a lung health summit was held last year with the British Lung Foundation, the Union of Democratic Mineworkers, the NHS and MPs. I am also glad the NHS long-term plan recognises the objective of improving outcomes for people with respiratory diseases.
We do not want to add to the number of people diagnosed with this disease, so perhaps the Minister will also tell us what work is going on to make sure that any asbestos in schools and hospitals is rigorously monitored, if it cannot be removed. I expect that this is where the Health and Safety Executive comes into its own, a body which has often been unfairly vilified for just doing its job. I know that it has had to cope with cuts to its budget, but I hope that it is able to be on top of this issue.
Finally, on the pneumoconiosis order, how does the payment tie in with universal credit, as that was something that I was not sure about?
My Lords, I had the privilege of chairing the mesothelioma oversight committee of the last-resort scheme. I thank the Minister for both her presentation and the welcome change in dealing with research, which a lot of us were concerned about for a couple of years when it did not appear to be linked. We are pleased that the DWP is now working closely with other departments. Can the Minister indicate exactly how much was spent on a cross-departmental basis on research in the last 12 months to give us an idea of the scale of that improvement?
I want also to thank the staff in Minister’s arm’s-length branch who give my committee enormous support in dealing with stories of unimaginable pain and tragedy. Although one has to try to get some distance, it is important we all place on record that this is not some dry statutory instrument; it is about people’s lives and deaths. My own sister-in-law died of this disease some years ago. We still do not know whether it was as a result of pushing a trolley through the basement of the Scunthorpe hospital where she worked or of washing her husband’s overalls from the steelworks where he worked. Also, a good friend of mine died less than a year ago. I had known him for 40 years; he worked in local government. You would think, “Where on earth would he catch it in local government?” He was a student before he started his local government career, working for Cape Asbestos for 12 months.
I think it has been mentioned already that it is not always the traditional industries. There are jewellery repair workers; there are stable lads; there are all sorts of areas that people do not expect. It is important when we come across similar issues to try to pre-empt them and not allow this to happen again.
Finally—the Minister has pre-empted this issue and I know that the noble Lord, Lord Alton, will raise it, but I am going to be his John the Baptist and hope that I do not share the same fate—the forum for the victims and the victim support group have been trying for nine years now to get some equality between in-life payments and dependency payments. I know that the Minister has indicated that the Government have thought about this and decided that they should not do anything about it at this stage, but it is time to seek equalisation between the sums paid to asbestos victims who claim while alive and those paid to dependants, usually widows, which are much lower for pneumoconiosis. This disparity affects women in particular and has stagnated for quite a long time. Failing any change of heart, will the Minister agree to meet some of us to discuss any possibility for more flexibility in considering those requests for equalisation?
My Lords, if the noble Baroness, Lady Donaghy, does not mind, I would rather change the metaphor and say that I am very pleased to be part of the infantry; she is a very good general in this case. The noble Baroness, Lady Thomas of Winchester, made her case admirably, too. I am grateful to the Minister for the way in which she introduced the orders.
I return to an issue that I have raised often in your Lordships House: the harrowing and lethal effects of mesothelioma, something which unites all of us in all parts of the House. Many of us in the Chamber today have been involved in the fight against mesothelioma for many years and I am pleased to see this important issue again being debated in your Lordships’ House.
I wholeheartedly support the uprating of the lump sum payments in line with inflation. It is a matter of compassion, of justice—I will return to that issue—and of equalisation. In that last respect, I was disappointed by one thing that the Minister said, although I rather anticipated that she would say it—I shall return to that matter, too.
As the Minister told us, mesothelioma is an invasive type of cancer caused by prior exposure to asbestos. It grows in the pleural membrane, which lines the outside of the lung and the inside of the chest. Less commonly, it can also affect a similar lining around the abdomen or heart. There is currently no cure and mesothelioma patients often have a short life expectancy and experience complex, debilitating symptoms. I vividly remember when I was a Member of House of Commons, representing an inner-city area of Liverpool, constituents coming to see me once there had been a diagnosis and then meeting the widow only weeks later, their loved one having died.
The UK has the highest rate of the disease in the world. Mortality rates have more than quadrupled over the past 30 years. It is estimated that around 2,400 people die of the disease every year and that, over the next 30 years, around 60,000 people will die of mesothelioma in the United Kingdom unless new treatments are found.
When these regulations were discussed in the other place, a number of Members of the House of Commons asked whether future increases could be made automatic rather than be made at the discretion of Parliament. The Minister there agreed to consider this. It is important that the Government carefully consider the argument. Has any consideration been given since the Commons stages about making the payments automatic? It is vital that we continue to support people and their families affected by these awful diseases.
Back in 2014 I tabled an amendment to the Mesothelioma Bill, and in 2015 I introduced a Private Member’s Bill which would have set up a small levy on participating insurance firms to help secure long-term funding for research into mesothelioma, an issue on which the noble Lords, Lord Wills and Lord Giddens, played an important part. At the time, it was estimated that 150 insurance firms were active in the employers’ liability insurance market, and this had the potential to raise around £1.5 million a year for research. This represented a very small amount of money to each of the insurance companies, but would have resulted in a great number of research opportunities. It would also have given great hope to people living with mesothelioma and to their families. Unfortunately, the amendment and the Bill were defeated.
Since then, the Government have allocated £5 million for a National Centre for Mesothelioma Research at Imperial College, and I thank Ministers who put in considerable effort to secure that and to look at voluntary funding from the insurance industry. I am very pleased that the British Lung Foundation, referred to by the noble Baroness, Lady Buscombe, was also able to secure match funding for this £5 million from a philanthropist who has seen the devastation wreaked by this disease. Unfortunately, although several individual insurance companies, including Aviva, Zurich, RSA and Allianz, had also, to their credit, previously contributed towards research into mesothelioma, negotiations for a broader, long-term funding commitment from the insurance industry came to a standstill. More recently, there have been some impressive results in mesothelioma research, which demonstrates why it is important for us to find more funding. Through the match funding, the BLF set up the Mesothelioma Research Network to bring researchers together to share ideas and support each other’s research. Our understanding of the genetics of mesothelioma has increased at the same time as a breakthrough in harnessing the immune system against cancer, and a clinical trial, the first of its type, has just opened in Leicester.
Another BLF-funded project is currently looking at ways to treat mesothelioma with immunotherapy. The creation of the MesobanK project now allows researchers across the world to access tissue and blood samples and other clinical data. The first MesobanK-British Lung Foundation fellowship is helping to develop gold nanotubes as potential new mesothelioma therapies. The British Lung Foundation continues to raise awareness of occupational lung disease, most recently through the creation of the Taskforce for Lung Health. The task force is a coalition of 30 organisations from across the lung health sector, including royal colleges, patients and the Health and Safety Executive, who came together to develop a five-year national plan to improve lung health in England. It makes recommendations to improve awareness of and compliance with the Control of Substances Hazardous to Health Regulations 2002 and to embed understanding of occupational lung disease in healthcare professional training.
Because this field is so underfunded, every pound of investment is likely to be worth while and to attract further funding. I pay particular tribute to Penny Woods and the British Lung Foundation, which continues its work to secure that funding for vital mesothelioma research. It has recently been able to leverage further research through the success of previous projects, helping to secure a £10 million grant from the Engineering and Physical Sciences Research Council. While I fully support compensation for the victims of these diseases, it is surely in everyone’s interest—the victims, the Government and insurers—to invest in finding a cure. This would, in the long term, remove the need for lump sum payments or any insurance industry levies. Investment in research is crucial.
On the subject of lump sum payments, as the noble Baroness told us, two statutory schemes make payments to mesothelioma sufferers, both of which make payments according to the age of the sufferer and their level of disablement. Both make payments either to mesothelioma sufferers who claim a payment in life—so-called in-life claims—or to their dependants where a claim is made after death. These are so-called dependency claims. However, there is significant inequality between dependency and in-life payments. From April 2019, the maximum in-life payment for a sufferer aged 77 is £14,334 and for a sufferer aged 37 is £92,259. From the same date, the maximum dependency payment for a sufferer aged 77 is £7,949 and £48,013 for a sufferer aged 37. Dependency payments are 45% less for a sufferer aged 77 and 48% less for a sufferer aged 37.
The disparity between payments is partly the result of the difference in assessment of disablement and age of the sufferer. In-life payments under the 1979 Act are assessed at a maximum of 100% disablement. Dependency payments are assessed at 50% or over. In-life payments under the 1979 Act are paid on a rising scale up to the age of 77 and over. Dependency payments are paid on a rising scale up to the age of 67 and over. Most dependency payments are made to women—widows of mesothelioma sufferers who are doubly disadvantaged by low dependency payments. As the average age of sufferers is approximately 77, many widows, who traditionally may not have a full record of employment, may have very poor pensions, a point alluded to in our discussions on the earlier orders. Personal injury compensation payments to dependants are higher than compensation payments to sufferers paid in life.
The law recognises the financial loss incurred by widows of mesothelioma sufferers. The number of dependency claims compared to in-life claims is very small. In 2017 under the 2008 Act, there were 20 dependency payments and 370 in-life payments. In that year, under the 1979 Act, there were 240 dependency payments and 2,770 in-life payments. As a percentage of total payments, dependency payments make up 8.2%. In 2017, the Asbestos Victims Support Groups Forum estimated that the percentage was approximately 10%. One reason for the decline in dependency payments is the success of the Employers’ Liability Tracing Office in identifying employers’ liability insurance. This has resulted in an increase in the amount of benefit and lump sum payments recovered by the Government. In 2017, the Asbestos Victims Support Groups Forum estimated that the cost of equalising payments would be approximately £1.5 million. In the same year, the Government estimated the cost at £2 million. Yet in 2018, the Government estimated the cost of equalising payments to be £5 million. Can the Minister explain why this estimate has more than doubled and how that figure of £5 million was reached?
It was in 2010 that the noble Lord, Lord McKenzie, the then Minister, to whom I pay particular tribute, committed the Government to equalising payments and went on to do so. In that year, he increased dependency payments to commence a gradual process of equalising payments. Nothing has been done since the noble Lord did that back in 2010. Manifestly, there is an unjustifiable disparity between dependency and in-life payments. The number of dependency payments is a fraction of total payments, just 8.2%. The cost of equalising payments is modest: between £1.5 million and £2 million. Meanwhile, it is worth noting that the Government have benefited from increased benefits and lump sum recoveries as a result of the stimulus to the Employers’ Liability Tracing Office in finding employment liability insurers once the Diffuse Mesothelioma Payment Scheme made employers’ liability insurers responsible for untraced insurance. Furthermore, the Government have recovered millions in benefits and lump sum recoveries as a result of the Diffuse Mesothelioma Payment Scheme payments which incur such recoveries. The millions of pounds in recoveries dwarf the modest cost of equalising the payments.
So I welcome the Government’s decision to accept their duty to honour the previous Government’s commitment to equalise payments. However, successive Ministers have excused themselves in the manner of the noble Lord, Lord Henley, who said:
“However, we do not intend to equalise payments this year. Instead, we will continue to keep this matter under review and consider equalisation, once resources allow”.—[Official Report, 28/2/17; col. GC 193.]
Can the Minister, when she comes to reply, tell us when that elusive date might finally be reached?
I have two other brief questions for the Minister, of which I have given her notice. I sent her an email last night; I hope it arrived. During the passage of the Mesothelioma Bill, the noble Lord, Lord Freud, gave a commitment to increase DMPS payments in line with CPI. Despite his commitment, this has not been done. Would the Minister explain why the commitment of the noble Lord, Lord Freud, to implement annual CPI increases, at a time when it was already known that the scheme would not make 100% awards, has not been honoured since the establishment of the DMPS?
My final point, alluded to a moment ago by the noble Baroness, Lady Donaghy, is on the position of people in the Armed Forces and those affected at a step’s remove, such as those who might have been washing overalls. I recall, in some of the debates I referred to earlier, that the noble Lord, Lord McNally, movingly described how his own sister had died through washing her husband’s overalls after he came home from the factory. The MoD mesothelioma scheme—to which the noble Lord, Lord West of Spithead, also referred in previous debates—pays lump sum compensation in lieu of a war disablement pension to veterans exposed to asbestos while serving in the Armed Forces. As the noble Baroness, Lady Thomas, said, there has been little research on why these things occur in the Armed Forces. Why have we not increased payments since the scheme’s inception in 2016? Do the Government have any plans to increase the level of payments made under the MoD scheme? If not, why not?
My Lords, I am delighted to follow the noble Lord, Lord Alton, and will take advantage of the opportunity to pay tribute to him for the immense work on this matter that he has undertaken in recent years. I too welcome the uprating. On the points raised by the noble Lord, I agree entirely that research should be undertaken. But we should also look at all possible ways to eliminate the causes of asbestos-related diseases.
We are aware of the incidence of asbestos in schools: three-quarters of schools in the United Kingdom have asbestos in them and, every year, some teachers die as a result of asbestos-related diseases. I wonder how many perhaps unidentified children have been affected by this. I do not know how much research has been done on this, but clearly anything that can be done to avoid the disease is better than a cure.
None the less, I welcome the fact that some £130 million has been paid since 2014 in compensation to about 1,000 sufferers—about £40 million of this has come from the insurance industry. But I take very much to heart the point made by the noble Lord, Lord Alton, that research is vital in these areas. The other sphere that could do with more research is MoD buildings. A number of them have been affected by asbestos, and families of servicemen have been hit by the disease.
I move on to the pneumoconiosis order, which I also welcome very much. The circumstances in which we are discussing this are so similar to those in 1979, when the original Act went through. I suspect that I am one of the few people in the Chamber who was involved at that time. There was a striking similarity—a Government without a majority striking a deal with a small party to get this through—and I was so pleased to be in the right place at the right time to help with it. The 40th anniversary reminds us of the tremendous contributions that have been made by this Act—not only to the slate-quarrying community, whose lobbying brought about the Act, but to a number of other workers in industries such as cotton and in kiln-related work, who were also able to get compensation.
The Act arose because, while coal miners had in general been helped by the 1975 tripartite agreement between the NCB, the NUM and the Government, that agreement did not cover other workers suffering from industrial lung diseases. The 1979 Act has paid out millions of pounds by now, and is still being called upon by a whole range of industries. Therefore, it is appropriate that it should be uprated in this way.
There are still some misgivings about other health conditions undoubtedly stimulated by working in such dusty environments. Conditions such as emphysema and chronic bronchitis are not accepted as lung diseases—although they are in all probability generated in many circumstances by that exposure to dust.
There are a couple of points I will put to the Minister; if she cannot answer them now, I would be grateful if she could write to me. First, what is the position of quarrymen who may have worked for periods of time in overseas quarries—such as in the United States or Spain—with regard to entitlement to compensation? The second relates to those who may have worked in the United Kingdom but who may be living in another EU country. How will the changes of Brexit impact on their entitlement to receive such compensation? That said, I support these regulations.
My Lords, I am always glad to follow the noble Lord, Lord Wigley, who had knowledge of the original Act. I congratulate my noble friend on introducing this instrument.
This has been a very poignant debate, and there is very little I can add to the contributions of those who have spoken with such knowledge. Like the noble Baroness, Lady Thomas of Winchester, I have a close family friend who succumbed to the disease. I was surprised that someone who had worked from a very young age for the Merchant Navy had this disease; where I grew up, he would not have been alone in doing so, because in those days the Merchant Navy offered huge opportunities for learning a trade—as did the Royal Navy. I know that it is not my noble friend’s direct responsibility, but could she reassure us today that the engine rooms of ships in the Merchant Navy do not now pose any danger from asbestos? I would like that reassurance going forward.
I was very disheartened when my noble friend very honestly told us that we can still expect a number of cases each year. The question I will ask her is simple—what is the length of time between the making of the claim and receipt of a payment? This also touches a little on the debate earlier. How would someone such as our family friend know that they are eligible for this compensation if they have not been contacted by their employer? Is there a mechanism in place for this? With those two questions, I would like to give these regulations a fair wind.
My Lords, I welcome the Minister’s helpful comments and the opportunity to debate these regulations. Over the last 10 years, we have seen strides forward in the fight against mesothelioma. Thanks to a great deal of political support and work by colleagues in this House—I pay tribute to the noble Lords, Lord Alton, Lord Giddens and Lord Wills—and by Mike Kane, Tracey Crouch and the late Paul Goggins in the other place, much has been done to raise awareness of the disease and to improve life for people affected by it.
Because of the long period between exposure to asbestos and the appearance of symptoms, it can be extremely difficult for people with mesothelioma to trace a liable former employer or insurance company. In recognition of this, the Mesothelioma Act 2014 was passed to ensure that victims of mesothelioma who were unable to trace a liable insurer could claim compensation from a scheme funded by a levy on insurers. I thank colleagues who supported the Act and who have helped keep mesothelioma on the agenda. Since the launch of the scheme, £130 million has been paid in compensation to around 1,000 people. Like other noble Lords, I declare an interest: my late sister Annabel contracted mesothelioma in her early 50s—she had two young children at the time—and was a grateful recipient of compensation from an earlier version of this scheme that the Minister highlighted in her comments.
Mesothelioma is poorly understood and historically has suffered from a lack of research investment. My noble friend Lord Alton tabled an amendment during the passage of what became the 2014 Act to secure sustainable funding for research into finding a cure for mesothelioma by charging a small additional levy on participating insurance firms. It was a great shame that the amendment was defeated here; it would have driven sorely needed investment into treatment. But the Government did allocate £5 million for a National Centre for Mesothelioma Research, and I am pleased that the British Lung Foundation, under Penny Woods, to which I also pay tribute, was able to secure matched funding to support further research and clinical trials and a mesothelioma research network.
The British Lung Foundation continues to raise awareness of occupational lung disease, most recently, as the Minister mentioned, through the creation of the Taskforce for Lung Health. The task force is a coalition of 30 organisations from across the lung health sector, including royal colleges, patients and the Health and Safety Executive, which have come together to develop a five-year national plan to improve lung health in England. The task force makes recommendations to improve awareness of and compliance with the Control of Substances Hazardous to Health Regulations 2002 and to embed understanding of occupational lung disease in healthcare professional training.
There can be a mistaken belief that occupational lung disease is a thing of the past. It is not—it still affects people today, and from a wide variety of backgrounds. The Health and Safety Executive estimates that occupational lung disease results in around 12,000 deaths a year. I therefore welcome the Motion to uprate the lump sum payments in line with inflation for people suffering from mesothelioma and pneumoconiosis and their dependants. It is vital that we continue to support people and their families affected by these awful diseases.
When these regulations were discussed in the other place, a number of MPs—like the noble Baroness, Lady Thomas, and the noble Lord, Lord Alton, today—asked whether future increases could be made automatic rather than be made at the discretion of Parliament. The Minister agreed to consider this, and it is important that the Government give thought to this argument. It would certainly send a powerful message that, while no amount of money will compensate for the suffering and loss caused by these diseases, we are at least committed to ensuring that people get the support they are entitled to and that it is not diminishing for those diagnosed in future.
Along with other concerned parties, I have recently been exploring the current knowledge of the potential health risks of the use of carbon fibre and carbon nanotubes in the manufacture of aircraft and road vehicle brakes. Some types of carbon nanotubes bear striking similarities to asbestos fibres in terms of shape, size and behaviour. Studies with mice have shown that they cause a cancer similar to mesothelioma. Although they are being investigated for use in a wide range of applications, it is believed that they are actually used in only a limited range of products, such as sports rackets. However, because of their strength and lightness, it is likely that future use of carbon nanotubes will expand into a wider range of products. We are unsure how commonly they are currently used, both here and abroad, as this information is commercially sensitive and not available from all manufacturers, or how well regulations and guidance on suitable alternatives are publicised. While there is still further research to be done into carbon nanotubes, we should not be complacent about evolving risks to our lung health. I will continue to explore this issue and suggest that current and future industries carefully consider alternatives to carbon nanotubes in the meantime.
The main focus today, however, needs to remain on the people affected by these devastating diseases—the workers, the wives, the husbands and the children—who currently have little hope due to the lack of treatment options available. As the former Health Minister, the noble Lord, Lord Prior, stated so bluntly in a debate on mesothelioma:
“It is a death sentence—there is no getting away from that”.—[Official Report, 27/10/16; col. GC 73.]
It is for them that we must approve these regulations and continue to do all we can to support them.
My Lords, this has been a full debate, and many contributors to it have had at least indirect experience of this wretched condition. I will comment on a few contributions before going on to my script.
The noble Lord, Lord Freyberg, referred to the historically long-latency circumstances and the need to make sure people understand that occupational lung disease is not a thing of the past—I agree with that. The noble Baroness, Lady McIntosh, asked how people get information about what is available. The short answer is through campaign groups, trade unions, and people like the noble Lord, Lord Alton, who has been involved in this for a long time; they are a good and reliable source of information about what is going on, as is, I am sure, the HSE. The noble Lord, Lord Wigley, talked about quarrymen; this has cropped up in the past from time to time, but as yet there has been no resolution. I am grateful to the noble Lord, Lord Alton, whose knowledge of where we are on this and the history of it is second to none; I know some of it but nothing like the wealth of experience that he brings. My noble friend Lady Donaghy asked about cross-departmental spend, and reminded us that we are dealing with heart-breaking circumstances. This is perhaps not the usual sort of debate we have.
We thank the Minister for introducing these two regulations, which we are discussing together. Obviously we will be supporting each of them. One is specifically concerned with mesothelioma and the 2008 regulations, and the other with the Pneumoconiosis etc. (Workers’ Compensation) Act 1979, which encompass other dust-related diseases.
As we have heard, they each make provision for lump sum compensation to people suffering from these diseases or for compensation for their dependants. I am not sure whether many noble Lords are aware of some very recent publicity about a situation local to me. Vauxhall Motors in Dunstable was prosecuted successfully for the death of a spouse; her husband worked at the plant, and because she hugged him when he came home at night, that—the nexus—was enough to give her mesothelioma. It is a tragic situation, but one of many. I am sure that Vauxhall will be properly dealt with.
Another point arises from that. It has sometimes been suggested that knowledge of mesothelioma is relatively modern—it is not. Some of the press reports on this refer to the fact that it goes back to the 1960s, if not earlier. Frankly, we were faced with circumstances where employers, and certainly those involved in liability insurance, did not do what they should have done with regard to their responsibilities.
In the case of the workers’ compensation Act 1979, the provisions apply to one of a range of diseases we have heard about which have been caused through accident or exposure in employment. These must have generated a claim to IIBD and not have given rise to a civil action against a former employer. The diseases in question are pneumoconiosis, byssinosis, diffuse mesothelioma, bilateral diffuse pleural thickening and primary carcinoma of the lung when accompanied by asbestosis. I understand that it may still be possible to get compensation for an asbestos-related disease under the 2008 scheme even if it is ineligible under the 1979 scheme. The later scheme does not require a work nexus: the oft-cited example of a family member washing clothes is now made much more poignant by the press reports to which I just referred.
The 2008 payments scheme is for no-fault compensation and includes coverage of the self-employed. Although monetary compensation is no substitute for a life, it can help with practical issues, especially if available speedily. We should note at this point that the diseases covered very much reflect our industrial past and a careless approach to matters of health and safety. Unfortunately, we have not heard from my noble friend Lord Jones, who normally contributes powerfully to these debates, but we have heard from others.
I note with approval the point made by the Minister in the other place in praise of the Health and Safety Executive—in stark contrast to the prior contribution of David Cameron on such matters, who determined that Britain’s health and safety culture would be killed off for good by the Government. It is a pity that, notwithstanding the Minister’s intervention, the HSE has seen dramatic budget cuts.
Mesothelioma is a type of cancer that covers the lining of the body’s organs. It is invariably caused by exposure to asbestos and results in death. It is a long-latency condition, as we have identified, and can emerge 40 to 50 years after contact with asbestos. To be fair, in introducing the regulations, the Minister let us know how many individuals have died and the forward projections.
As was debated in the other place, asbestos is still present in many structures, particularly in our schools—not to mention in this building. The Government used to have in place robust communications about the dangers of asbestos and messages about how it should be treated. What is the current position?
The level of compensation payable has been increased by 2.4% in accordance with the September 2018 consumer prices index. Can the Minister confirm that indexing of the 1979 and 2008 Acts compensation amounts has been routinely carried out, notwithstanding that there is no statutory obligation to do so? Several noble Lords, including the noble Baroness, Lady Thomas, at this end, pressed the Government on why the uprating had not been made statutory—on reflection, that is an entirely reasonable point.
A key difference between the two sets of regulations is that the mesothelioma regulations have a schedule only for sufferers and dependants. The pneumoconiosis schedule is for both, and also reflects the degree of disablement. The noble Lord, Lord Alton, introduced some very important data about the differential between those two scales. In the case of mesothelioma, the compensation schedules reflect the fact that it has been treated as invariably fatal.
I have some questions for the Minister, the first of which she has already answered. When the 2008 scheme was devised, it was determined that levels of payments would be funded from recoveries from civil action until such amounts matched levels of payment under the 1979 Act. What are the current levels of recovery? What drives the quantum of lump sum payments under the 1979 Act?
Can the noble Lord repeat the question?
Yes, I should speak up. What are the current levels of recovery under the 1979 Act? Also, what drives the quantum of lump sum payments under that Act, which created the schedule in the first place? We know what the uprating is about.
The annual question posed is about bringing payments for dependants up to the level payable to sufferers. I join those who say it is time that we should do this. Debate in the other place on the regulations was in part conflated with arrangements in the 2012 Act, which I think was introduced only in 2019. Historically, as we know, there were concerns about low levels of compensation made available for these long-latency diseases. Focus for a long while was on the traceability of employer liability policies and, although progress was made, it was considered that in too many cases employers and their insurers were avoiding liability. I understand that this led to the diffuse mesothelioma payment scheme, introduced in 2014 and led by the noble Lord, Lord Freud, who deserves credit for his difficult negotiation with the insurance sector.
The scheme was set up to provide for sufferers of mesothelioma who were negligently exposed to asbestos at work but unable to pursue a civil claim because their former employer had gone out of business or the employer liability insurer was untraceable. The scheme would not be the first port of call for a lump sum payment. After considerable negotiation, relevant insurers accepted some responsibility for those situations and agreed to fund a payment scheme. They accepted a levy based on gross employer liability premiums with a maximum of 3%. Our thanks should go to my noble friend Lady Donaghy, who chairs the oversight committee; we heard from her earlier. What are the current levels of payment? Is 3% of employer liability insurance the sum being dispensed or disbursed?
Those matters are outwith the regulations before us today but are part of the story of combating mesothelioma, as is the campaign to get the insurance industry to contribute to research. We should be mindful that the UK has the highest incidence of mesothelioma in the world—a point already made. It is understood that some insurers have met their obligations and that a successful collaboration is under way with, as was referred to by several noble Lords, the National Heart and Lung Institute, Imperial College London, the Royal Brompton NHS Trust and the Royal Marsden NHS Trust. Can the Minister update us on that work, which we know has been strongly supported by Members of this House?
Finally, a point was raised in the other place about the difference in treatment for universal credit and tax credit purposes of IIDB. It was suggested that this gives rise to recovery of IIDB under universal credit but not tax credit. Is that correct and, if so, how does the Minister justify that disparity of treatment?
I end by paying tribute to those campaigners over the years, some of whom have spoken today. I should mention Graham Dring of the Asbestos Victims Support Group and Hugh Robertson of the TUC. Sadly, the need for their campaigning continues.
My Lords, I begin by thanking all noble Lords who have contributed to this really important debate. I go straight to the first point raised: why do we not uprate automatically every year or put this on the statute book? I absolutely understand where that question is coming from. It was asked by several noble Lords, most notably the noble Baroness, Lady Thomas. I think it is important to have a debate such as this to remind not only noble Lords but those many people beyond who may not appreciate that this is not something that will end in the short term. Noble Lords have so passionately highlighted the perverse ease with which people can contract these deadly diseases. We still have to be incredibly careful and cautious about the future for those people.
The noble Lord, Lord Freyberg, mentioned new products such as carbon nanotubes, which I confess I know little about. The issue of threats from these new products should be raised through opportunities to help awareness, such as this really good debate. In that way, points can be made and we can raise both awareness and ongoing concerns.
I want to be very clear that, during last week’s debate in the other place, there were calls to put the uprating of the lump sum schemes on a statutory footing with a legal requirement to uprate annually in line with inflation, and my honourable friend the Minister for Disabled People, Sarah Newton MP, agreed to consider the proposal and work with her officials to explore the options. I want to set the record straight because, with great respect to the noble Lord, Lord Freyberg, I think I am right in saying that, although he said that my honourable friend said that she would make this change, she in fact just agreed to consider it.
I will do my absolute best to respond to the number of questions asked by noble Lords as fully as I can. Several references were made to the Health and Safety Executive, with which we have a brilliant working relationship and whose work is instrumental in looking at threats from new products. The question was asked what we and the Health and Safety Executive are doing to raise awareness of asbestos. The HSE health priority plans set out three strategic priorities for our work on occupational health going forward, the core focus of which concerns work-related stress, musculoskeletal disorders and occupational lung disease—including the risks associated with asbestos. Delivery of the OLD strategy includes holding a,
“National Summit to raise the profile of occupational lung disease”,
“establishing and facilitating a new Healthy Lung Partnership … to provide direction and coordinate stakeholder activity on occupational lung disease”.
Following the asbestos awareness campaign between October 2014 and March 2015, the Health and Safety Executive continues to make a wide range of information freely available through its website. Further specific awareness-raising activities may be considered in future, and helping at-risk workers to recognise that asbestos is relevant to them and their work, encouraging them to seek reliable information about how they can protect themselves, and encouraging and enabling safer work with asbestos through behavioural change is always at the front of our mind.
Like other noble Lords, I pay tribute to the brilliant ongoing work of the British Lung Foundation in research, clinical trials, supporting research into lung health and recognising some of the difficult cases raised today.
The noble Baroness, Lady Thomas, asked specifically what the Government are doing to remove remaining asbestos in schools, which I believe noble Lords will have thought about on a personal level. The Department for Education takes this issue seriously and is committed to supporting schools, local authorities and academy trusts in fulfilling their duty to manage asbestos safely. It is the Government’s aim to remove all asbestos from schools as more school buildings are replaced and refurbished over time. We have taken significant steps in recent years to strengthen schools’ approaches to managing asbestos, including publishing refreshed guidance for schools in 2017 and launching an assurance process earlier this year to understand the issue better. Expert advice, again from the Health and Safety Executive, is clear that as long as asbestos-containing materials are undamaged and not in locations where they are vulnerable to damage, they should be managed in situ.
However, we are clear that asbestos cannot be managed effectively in situ. It should be removed; we have provided significant funding for that purpose. Indeed, the department has invested £5.6 billion in maintaining and improving the schools estate since 2015, enabling local authorities, academy trusts and voluntary-aided schools to maintain their school buildings. This is all part of the Priority School Building Programme, with its additional investment of £4.4 billion. Asbestos is being removed or encapsulated where appropriate as part of these investment programmes.
The noble Baroness, Lady Thomas of Winchester, and the noble Lord, Lord McKenzie, asked about universal credit. Broadly, the same rules will apply to universal credit as under current working-age income-related benefits. For someone with a disease who receives a lump-sum payment under either of these schemes and also receives an income-related benefit, the payment is treated as capital, not income, and is disregarded for a 52-week period. After that time, if the money has been placed in a trust fund, the capital will be disregarded, as will any income from the fund. If the payment is made to a working-age dependant, the normal capital rules apply, meaning that if the dependant’s total capital is more than £6,000, their income-related benefit may be reduced. If they have capital of £16,000 or more, their benefit entitlement will end.
A question was also asked about why dependants who claim payments under either of these lump-sum schemes are paid less than if the person with the disease had made a claim in life. As I said in my opening speech, the main intention of these schemes is to provide financial support for people living with certain diseases and help them to deal with the issues that illness brings. As around 90% of payments made under both schemes are paid to people with a disease covered by them, we believe that resources are rightly targeted. For example, in 2017-18, 3,420 payments were made to people with those diseases and 260 to dependants.
The calculations for dependants are complex and depend on a number of factors, such as the age of the person with the disease, the length of time between diagnosis and death and whether the person died from the disease or from some other cause. In 2017-18, across both schemes, 3,420 awards were made to people with a disease, averaging £13,783 each. For the dependants, as I said, 260 awards were made, but they averaged £8,462. However, this comparison is broad and does not really reflect the complexity involved in these calculations.
Noble Lords asked why the Government do not equalise dependant payments with those made to people with a disease. We estimate that the additional cost of equalisation would be in excess £3 million per year. We must prioritise resources where they are needed most: with people living with a disease. Equalising awards between people with a disease and their dependants would require legislative changes. That would be a complex task, as awards to dependants under the 1979 Act include payments made in two parts: first, a payment for the effects of the illness before death, based on the assessed level of disability and the length of time the person had the illness; and, secondly, a payment made in cases where the death was actually caused by the relevant disease. Taking forward such changes is not a current legislative priority, but we will continue to keep this issue under review.
The noble Baroness, Lady Donaghy, suggested meeting to discuss the issue of equalisation. I do not want to commit my honourable friend in the other place, the Minister for Disabled People, but she is renowned for welcoming meetings. I shall suggest to her that this meeting could take place because it is very important for noble Lords to have the opportunity to share things with her—she takes these matters incredibly seriously—and discuss this point further. I heard with care and I want to share with my honourable friend in another place the details of the different suggestions that the noble Lord, Lord Alton, has made today of schemes that could support such a move. I suspect my honourable friend is already aware of them; she is always so on top of her brief. However, I think it would be helpful if I share with her the entire debate that has taken place today to see what could be done. I will be in touch with all noble Lords on that proposal for a meeting, and all will be welcome.
I was asked if the lump-sum payments paid to the estates of people who had the disease but are now deceased are made at the same rate. The answer is that, if someone with the disease makes a claim but then dies before payment is made, the payment is made to their estate at the same rate that they would have received had they received their payment in life.
The noble Baroness, Lady Donaghy, and a number of noble Lords referenced the issue of research. As several noble Lords said, a grant of £5 million from Libor fines was awarded to Imperial College in 2016 to establish the National Centre for Mesothelioma Research. The centre brings together four leading institutions, all of which have a major interest in treatment of mesothelioma: the National Heart and Lung Institute at Imperial College, the Institute of Cancer Research, the Royal Brompton Hospital and the Royal Marsden Hospital.
The Government have also committed to a number of other measures to stimulate an increase in the level of mesothelioma research activity. The Department of Health and Social Care’s National Institute for Health Research undertook a priority-setting exercise to stimulate an increase of mesothelioma research. As a result, five studies were funded following an NIHR themed call, with total funding in the region of £2.6 million. One project was completed in 2018, although we would not expect results to be published for some time after the completion date. Funding continues to be available from the NIHR, the Medical Research Council and other sources, including medical research charities.
The noble Baroness asked for a specific figure for research. It is quite difficult to say exactly how much, because funds are coming from so many different sources—from match funding, wonderful philanthropists and so on. A number of noble Lords alluded to different areas of support for research, and we are very focused on the need for investment in research, which, as the noble Lord, Lord Alton, said, is utterly crucial.
I think I have already talked about the British Lung Foundation launching the UK’s first mesothelioma research network in 2018. The vision of the network is to improve outcomes for people affected by mesothelioma by bringing researchers together, thereby driving research progress and improving the quality of research. The network is supported by a major £5 million donation from the Victor Dahdaleh Foundation, which matches funding given to Imperial College by the Government to establish a national mesothelioma research centre.
The noble Lord, Lord Alton, asked why the tariff is not upgraded annually and whether we will ensure that the tariff remains comparable to the awards for civil damage and claims. This relates to the assurance from the noble Lord, Lord Freud. When the DMPS was introduced in 2014, the payment tariffs were based on 80% of the average damages awarded in the civil courts. We increased this to 100% in 2015. This increase is far greater than if increases had been made in line with the consumer prices index, so I think I can safely say we have followed through on the assurance from my noble friend Lord Freud. For example, the highest DMPS payment for those aged 40 or under in 2014 was £216,896, which increased to £271,120 in 2015. The lowest payment for those aged 90 or over increased from £69,649 to £87,061. In line with commitments made during the passage of the Mesothelioma Bill, we intend to review the payment tariffs in due course to ensure that payments made under the scheme are maintained at the appropriate level.
I was asked why any surplus from the diffuse mesothelioma payment scheme levy cannot fund medical research into mesothelioma or why we do not introduce an additional levy for the purpose. The levy funds come from the employers’ liability insurance market to pay for a scheme for those affected by the failure of the employers’ liability market to maintain sufficient records. During last week’s debate in another place, it was suggested that any surplus funds could be used to fund research into mesothelioma. Another suggestion was that an additional levy could be introduced for this purpose. My honourable friend the Minister of State for Disabled People made a commitment to look at this further.
I was asked about financial support for people who become disabled after having an accident at work or develop a disease as a result of their occupation. In addition to compensation awarded through the schemes before us today, the Government also provide specific support for those who have industrial injuries or diseases through our industrial injuries benefits. The main element is industrial injuries disablement benefit, a weekly payment based on the level of disablement. Other state benefits may also be available to claimants to cover other needs, such as income replacement and/or the costs arising from the disability.
One question was: why has the estimate for equalisation more than doubled? This is because of an error in a previous analysis. It is not a simple matter of equalising the average awards to dependants with those to sufferers. This is the complexity I referred to earlier. Where a payment is made to a dependant, the sufferer will generally have had the highest level of disablement— 100% prior to death. An average comparison between the two groups does not reflect this.
The noble Lord, Lord Wigley, asked whether people who come from abroad are allowed to make a claim for a lump-sum payment under the schemes. One of the conditions of entitlement to a payment under either the 1979 Act scheme or the 2008 Act scheme is that the exposure to certain harmful dusts—most commonly asbestos—must have occurred while the claimant was in the UK. People who have come from abroad will therefore be able to receive a payment provided they can demonstrate that they were exposed to certain harmful dusts, most commonly asbestos, in the UK. People who now live abroad but were exposed in the UK are also able to make a claim.
I was referring to those under the pneumoconiosis compensation scheme, whereby dust has accumulated, perhaps in a quarryman working in Wales for a number of years then working abroad, and the disability only becomes apparent after he has worked abroad.
Yes. As I said, it has to be demonstrated that the disease was as a result of working in the United Kingdom. If somebody worked for a number of years in the UK and then continued that occupation abroad, I assume that it would be for those who assess an individual’s case to make a reasonable assessment in the circumstances.
A number of noble Lords, including my noble friend Lady McIntosh of Pickering and the noble Lord, Lord Wigley, spoke about the MoD scheme. With a son in the Fleet Air Arm, I have a personal interest in this. It is an extremely good question. Are we being careful to ensure that we are doing all we can to protect our Armed Forces—particularly those in the Navy, on ships? I would welcome a reply from the Ministry of Defence, so I say here and now that I will ask that question with all speed and reply to all noble Lords and place a copy in the Library.
My noble friend Lady McIntosh also asked how long it takes to deal with claims under the 1979 Act scheme and the 2008 Act scheme. Claims lodged under both schemes are dealt with as quickly as possible. For the 1979 Act scheme, which includes diseases other than diffuse mesothelioma, it can take a number of weeks as investigations may be required into the existence of a relevant employer against which civil action may be taken. However, that is still very quick in comparison with civil litigation cases, which of course can take years. Under the 2008 scheme, where there is no need to ascertain the existence of a relevant employer to sue, cases are dealt with very quickly. Dependant claims under both schemes can take longer, as the department may have to await the death certificate or other official confirmation that establishes the cause of death. We are not aware of any general delays or issues with processing claims.
A number of noble Lords touched on what we do to promote awareness of the schemes. The Department for Work and Pensions highlights the availability of the 1979 Act scheme to industrial injuries disablement benefit claimants in official letters. A leaflet is included with the award notice for any of the five diseases covered by the lump-sum scheme, encouraging people to make a claim. All government schemes are publicised on GOV.UK. The department also maintains regular telephone contact with a range of asbestos support groups, and meets their representatives face to face at the annual asbestos forum to discuss the lump-sum schemes.
The noble Lord, Lord McKenzie, asked about the amounts recovered each year by the Compensation Recovery Unit of the Department for Work and Pensions. It recovers around £27 million per year from civil compensation awards. If a mesothelioma claimant subsequently recovers compensation in civil proceedings, the process for clawback of any lump-sum payments is as follows. Once a claim is settled or determined against a compensator, a certificate is requested from the Compensation Recovery Unit that details an amount equivalent to the value of benefits paid in respect of the condition for which the claimant has successfully pursued civil action. The compensator makes a payment of the value of the certificate to the CRU.
The 2008 Act scheme was set up on the basis that it would be funded by compensation recoveries from civil claims. The 1979 Act scheme is funded partly by civil compensation recoveries and partly by the department. It is a long-standing principle that people should not be compensated twice and, in most cases, where social security benefits are paid, they are recovered from compensation where people have been successful in a subsequent civil claim for damages. The net cost to the department of making payments under both schemes in the last financial year, 2017-18, was £22.2 million. Payments totalled £49.2 million and £27 million was recovered.
The noble Lord also asked how many people had benefited from the diffuse mesothelioma payment scheme, how much had been paid out and what was the average award. In the fourth year of operation, 2017-18, the scheme paid out £36 million in compensation to 200 successful claimants, with the average mean award being around £145,000—up from £141,000 the previous year. Since the scheme was launched in April 2014, it has helped just under 1,000 sufferers from mesothelioma, with £133.8 million awarded in compensation.
The noble Lord referred to tax credits and universal credit. Payments made under both schemes are paid by a lump sum and regarded as compensation. Therefore, they are not included as income for the purpose of income tax or tax credits. However, interest arising from the lump sum is subject to income tax and included in the income calculation for tax credits. For universal credit, payments are treated as personal injury compensation and, as I said, disregarded for one year. If they are then placed in a trust, they are disregarded indefinitely.
I hope that I have managed to answer noble Lords’ questions to the best of my ability. I thank all noble Lords for their many and helpful contributions to this debate. The Government recognise that the two schemes form a hugely important part of the support available to people with mesothelioma and certain other dust-related diseases. The regulations will ensure that the value of that support is maintained. I thank all noble Lords who have been supportive of the uprating of the payment scales for these schemes and ask approval to implement it.