9 January 2014Print This Post

MPs urge solicitors not to claim maximum £7,000 fee under new mesothelioma scheme

Parliament: MPs reject bid to increase compensation level

MPs have expressed hope that solicitors acting for mesothelioma sufferers under the new regime for those who cannot trace their insurers will not charge the full £7,000 being allowed for their fees.

The Mesothelioma Bill this week neared the end of its parliamentary passage after completing its third reading and report stage in the House of Commons on Tuesday.

Under the scheme – funded by a levy on current employer’s liability insurance providers – from July 2014 anyone in the UK diagnosed with mesothelioma after 25 July 2012 will be able to make a claim, but will only receive on average 75% of what they would have been awarded by a court.

Efforts to move the date back and increase the compensation levels were defeated on Tuesday, despite heavy criticism of the insurance industry, which MPs said had to be dragged to the negotiating table to agree this much. They praised the government for getting as far as it had, but said it needed to go further.

The legal fee was originally set at £2,000, but it was felt that this was too low and that people would not get the sort of legal advice they needed. Work and pensions minister Mike Penning told MPs during the report debate: “We desperately did not want the situation that had happened with other schemes whereby the legal teams got more money out of the compensation than that – that is why the figure is £7,000.”

If the claimant pays less than £7,000 in fees, they will keep the difference. “In the negotiations I have been having, the feeling has been that the actual amount will be less,” Mr Penning said.

However, Labour MP Nick Brown said: “I hope this does not sound unduly cynical, but once the legal profession knows that a maximum of £7,000 is available for the cost of administering this, the work done and the effort put in by the individual law firms is likely to rise up towards the £7,000 ceiling.

“The minister’s hope that simpler and more straightforward cases will confine themselves to a lower fee is correct, and I am with him on it, but I have the feeling that things will not work out that way.”

Shadow work and pensions minister Kate Green also expressed concern that the £7,000 will become a tariff. “I have since been advised by an asbestos victims support group that it has been asked to help to get mesothelioma victims to put pressure on their lawyers to keep the fees low. That is unacceptable.
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“At a time when they are coping with an appalling illness and worrying about the future for their families, as they know they may not even survive to receive the compensation that they are due, the last thing they need is to get into an argument with their lawyers about fees.”

On the level of compensation, Mr Penning said that it was 75% of the average. “[This] means that some people will be worse off – I fully admit that – but that some people will get more than they would have done if they had been able to trace their insurer or employer and go through the scheme.”

Claimant lawyers described the 75% proposal as “watered-down justice”. Matthew Stockwell, president of the Association of Personal Injury Lawyers, said: “It is bad enough that victims are exposed to deadly asbestos just by turning up for work, then forced to use this scheme because insurance records are no longer around.

“Now they are to be penalised by losing a quarter of what the courts determine is fair redress. This is not the justice these people deserve.”

Mr Stockwell described the scheme as “at least a start”, but said there are “many other workers affected by the heartbreaking consequences of workplace safety mismanagement. We will push the government to keep going and work to ensure full justice is available to all those who need it”.

Paul Glanville, an asbestos lawyer at Slater & Gordon, which has lobbied hard over the bill, said: “The scheme is certainly a step in the right direction but there can be no moral justification for mesothelioma victims receiving only a percentage of the compensation they are entitled to…

“Further whilst this new law provides some compensation for mesothelioma victims diagnosed after July 2012 it ignores the thousands of victims who have died before this arbitrary cut-off date.

“It is regrettable that the government has not taken a firmer line with the insurance industry, who over the years have always done as much as they can to reduce the compensation paid out to mesothelioma sufferers.”

The bill has now gone back to the House of Lords to consider amendments made by the House of Commons. Once these are agreed, it will receive Royal Assent.

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