Clause
45
Appeal
to appeal
tribunal
Question
proposed, That the clause stand part of the
Bill.
Mr.
Clapham:
May I take this opportunity to ask the Minister
whether the appeal procedure to which the clause refers will be based
on the medical appeal tribunal? Will the medical appeal tribunal be
called on to intervene if, for example, the diagnosis is an issue? Will
it deal with questions of exposure, or is it intended to introduce a
new tribunal procedure? As I see it, the medical appeal tribunal
procedure is adequate to deal with such
cases.
12
noon
Mrs.
McGuire:
The Secretary of State for Justice and the Lord
Chancellor are responsible for regulations relating to appeal
procedures under clause 45(4)(a) and (b). The rules will be consistent
with the existing procedures for social security and child support
appeals to the tribunal or a commissioner. The tribunal will comprise
appropriately qualified people, including a medical member. I am not
quite sure if that answers the specifics of the question. If it does
not, I will come back to the hon. Gentleman and others with a further
clarification.
Any
appeal made under the clause must be referred to an appeal tribunal,
unless it is to be treated as a request for a reconsideration of the
decision, which would be dealt with by the Secretary of State. The
appeal tribunal will be able to substitute a new determination for the
original determination made by the Secretary of State. Regulations will
be set out as to how the appeal is to be made and how long a person
will have in which to make such an appeal. The clause is needed to
provide a safeguard for people who feel that a decision made on their
claim for a lump sum payment is
wrong.
Question put
and agreed
to.
Clause
45
ordered to stand part of the
Bill
.
Clause
46
ordered to stand part of the
Bill.
Clause
47
Minors
and people who lack
capacity
Question
proposed, That the clause stand part of the
Bill.
Mr.
Boswell:
One of the distressing by-products of having
taken a substantial part in discussing the Mental Capacity Act 2005 is
that there is an almost irresistible temptation to refer to it in other
Committees. I do so briefly this morning and, I hope,
helpfully—I think that the Government’s intentions are
entirely clear—because I would like to flag up one or two points
arising from my experience of that very sensible legislation.
First, I would like to draw a
distinction, although it appears that the cases are similar, between
those identified in subsection (1). A person under 18 will never have
had the capacity of disposing of substantial assets of the order of the
£6,000 lump sum or, even as a dependant, a proportion of that,
which the Minister has already indicated, whereas a person who lacks
mental capacity may have been able to make that kind of disposition in
the past.
I mention
this matter to the Minister because there were some cases during the
passage of the 2005 Act in which it was clear that the Department had a
somewhat different set of criteria from those that were applied by the
now Ministry of Justice in relation to mental capacity. For example,
there were rather parallel systems in operation in relation to
appointed persons who could receive a benefit on behalf of
somebody.
However, I
remind the Minister that the 2005 Act does not provide a definitive
test for all matters at all times and it may vary according to the
circumstances. The difficulties of this are, first, trying to determine
whether the financial matters are sufficiently large for the person not
to have mental capacity, and, secondly, whether at the particular time
it is relevant, because a person can recover their mental capacity
whatever their physical condition. That, therefore, produces some
difficulty about the test in paragraph (b), because we need to know
that the person does not have mental capacity in relation to financial
matters. Had I had the time and inclination, I would have tabled a
probing amendment with the wording, “financial matters relevant
to the lump sum”. It would also have suggested that we should be
aware of the fact that the person could recover their capacity
subsequently.
That
leads me on to the second half of my argument—I am leading up to
a particular point that I want the Minister at least to entertain in
relation to the appointment of trustees. I mentioned appointed persons
under the social security legislation and how they differ from the
various persons who can be appointed under the 2005 Act. The proposal
in this case is that the Secretary of State will appoint such trustees
as are clearly appropriate. I have no doubt whatever that that could be
done and would normally work perfectly well. The Secretary of State
will also be able to specify trusts that are appropriate to the case.
Those who are more familiar than I am with compensation matters will
know that that kind of thing happens all the time in the private
sector—for example, in relation to road accident damages.
However, within the mental capacity legislation, there is the
opportunity for a person, while they have capacity, to appoint someone
as their attorney under a lasting power of attorney.
The point that mainly concerns
me is that if that person is competent—there is no reason to
think that they would not be, although they might not be because the
sum could be bigger than any that they have ever had to
handle—there is no reason to think that they should not be the
natural person to be the trustee for the Department for handling that
lump sum. They may be handling other assets that the person has
available under the terms of their lasting power of attorney. They
could receive and handle those perfectly well. I shall put it another
way. If a set of trustees handled other assets, represented by the
attorney holder, and a
different set handled these assets, that might not lead to the best use
of the assets overall and might give rise to friction. Those possibilities exist
within the mental capacity legislation. We do not need a definitive
answer on that from the Minister today, but I hope that she will have
regard to what is done in relation to that and try, as far as possible,
to marry the two systems, using the people who may already be
competently in place and who could handle perfectly well this other,
somewhat sad duty of receiving and dealing with a lump sum on behalf of
the person who has lost
capacity.
Mrs.
McGuire:
I thank the hon. Gentleman for his thoughtful and
helpful comments. The Bill’s provisions mirror the 1979 Act,
which predated the Mental Capacity Act 2005. He made some interesting
points, including those relating to whether a person recovers capacity,
the appointment of trustees and the power of attorney—that, as I
understand it, is something that a person sorts out before they have
lost capacity.
The
clause is certainly designed to ensure that someone who lacks capacity
is protected. It also safeguards the rights of other beneficiaries by
allowing the Secretary of State to appoint trustees and make a payment
to them to hold for the benefit of the beneficiary. The hon. Gentleman
made some interesting and detailed points and, although I do not wish
to pursue them now, we will certainly reflect on whether there are
further implications for the legislation as it
stands.
Mr.
Boswell:
That is an entirely satisfactory reply and meets
the point very
well.
Question put
and agreed
to.
Clause 47
ordered to stand part of the
Bill.
Clause 48
ordered to stand part of the
Bill.
Clause
49
Amendment
of Social Security (Recovery of Benefits) Act
1997
Question
proposed, That the clause stand part of the
Bill.
The
Chairman:
With this it will be convenient to take new
clause 21— Provision of information by
employers—
‘After
subsection 23(5) of the Social Security (Recovery of Benefits) Act 1997
(c.27)
insert—
“(5A)
Employers, corporate bodies or individuals whose activities have
resulted in the exposure of people to asbestos fibres, shall be under a
duty to take all reasonable steps to provide timely details of their
insurers.
(5B) Such insurers
shall have a duty to respond to claims enquiries in a timely manner.
The Secretary of State shall make provision by regulation to levy
charges where, in his opinion, there has been unreasonable delay in the
provision of such
information.”.’
Andrew
Selous:
Clause 49 is extremely important and deals with
how the money will be provided for the lump sum payments that the
Department will pay out up
front. If Committee members read clause 49 in full, they will see that
lump sum payments that are paid out promptly—within six weeks,
we hope, of diagnosis—are to be recovered from subsequent
compensation payments made either by solvent employers or by insurers,
should those employers choose to claim against their insurance policies
or should the employer have become insolvent. It is an extremely
important aspect of the Bill.
I shall refer briefly to
remarks that the Minister made in an earlier debate. I think she said
words along the lines of, “We do not have enough money to pay
everyone.” I may have misquoted her slightly, but it was
something similar.
Mrs.
McGuire:
To clarify that for the hon. Gentleman, the
remarks were about opening up the compensation scheme to people who
lived and were resident in other countries. If that was not clear, I
hope that I have made it clear now.
Andrew
Selous:
I thank the Minister for that clarification; I had
slightly misunderstood her, so I apologise.
It is none the less important
that we understand the mechanism that the Government
use—absolutely rightly—in the clause.
It involves using the compensation payments from solvent employers and
their insurers, or from the insurers of insolvent employers, to
compensate the Department—quite rightly—for the money
that it pays out quickly up front, and about which we are all
pleased.
New clause
21 is part of my attempts to be helpful, and I hope that the Minister
will recognise its spirit and intention. It would have two benefits. It
would benefit the sufferers of mesothelioma, because when an amount
greater than the lump sum payment is payable by the employer or by
their insurer, the new clause would speed up the compensation payment
process. If there were any excess over and above the lump sum, it would
get it to the sufferer more quickly. At the same time, it would come to
the aid of the poor, beleaguered public purse—the finances of
the Department for which the Minister is responsible—because it
deals with the mechanism whereby the Department gets back the money for
paying out the lump sum.
In a news release from the
Department on 20 July 2006, no less a person than the former Secretary
of State said:
“We are also continuing
the essential work that is ongoing to speed up the full compensation
payments due to many sufferers and their families through the civil
claims process”.
Those
words were very welcome and important, but it is not clear whether the
Bill includes anything to aid that process. The new clause would give
the Secretary of State the reserve power, when in his or her opinion
employers or insurers were dragging their feet and not responding, to
make a charge on them to ensure that they responded in a timely manner
to inquiries.
The new
clause was tabled in part because of my constituency experience, which
I am sure is mirrored by that of other Committee members who have found
employers and insurers incredibly slow and unresponsive when dealing
with such claims, whether they are for mesothelioma or for similar
issues. It gives
me no pleasure to say that, because my background is in insurance.
Before I came into the House, I was a chartered insurer, and I am
generally extremely proud of the British insurance industry. It makes a
major contribution to our balance of payments and the public purse, and
it does a tremendous amount of good throughout the world. I spoke to
the Association of British Insurers before tabling the new clause, and
I know that it, too, seeks to guard the good reputation of the
insurance industry. 12.15
pm
I hope that the
Minister will look sympathetically at the new clause. My experience as
a constituency MP is that it is almost impossible to get movement on
some cases. We know that the former Secretary of State was exercised
about such matters. The new clause gives the Department a stick with
which to prod or cajole employers or insurers as and when
necessary.
Mr.
Clapham:
I raise two points on clause 49, in
particular in relation to subsections (3)(a) and (3)(b) of proposed new
section 1A. Some of the responses that I received from the Association
of Personal Injury Lawyers relate to the recouping under subsection
(3)(a) of compensation paid to dependants of the deceased. The
association points out a conflict with the Fatal Accidents Act 1976,
saying that when assessing damages in respect of a person’s
death under that Act certain other benefits are disregarded. It feels
that in cases of mesothelioma we should also disregard the recouping of
payments made to dependants.
My second point is about
proposed new subsection (3)(b), under which recovery can be made from
the injured person’s compensation. It can result in the entire
payment being recouped. In a previous life, I heard of cases in which
recoupment resulted in the special damage element being completely
taken, but never has it taken any of the general damage element. It is
possible under proposed new paragraph (b) that money could be recouped
from general damages—payment for pain and suffering. Again,
there is a conflict with the civil law.
There is a chance that we may
give impetus to challenges in the civil courts on the basis that some
schemes, particularly this one, allow for general damages to be
recouped. Until now, they have been sacrosanct. Will the Minister
reflect on that? We do not want to create a situation in which general
damages that are normally ring-fenced in civil litigation are likely to
be taken. That would be the thin end of the wedge, and it is likely to
be challenged. Reflection is needed.
One other point relates to the
amendments that the Government are thinking of making to the Social
Security (Recovery of Benefits) Act 1977 in relation to proposed new
subsection (3)(e). They say that they want to be able to review
certificates of lump sum payments in a similar way to certificates for
recoverable benefits. They also say that they want to recover lump sums
from compensation when a claimant receives any of several prescribed
payments. One of those is payments made under the 1974 coal
workers’ pneumoconiosis scheme. I am aware that there will be
circumstances in which a person may have two claims. A person who can
claim under the 1974 scheme may be
able to claim also under the 1979 scheme. That has been the situation
since the demise of British Coal in 2004. A person who makes a claim
under the 1974 scheme before making another under the 1979 scheme is
precluded from using the 1979 Act on the grounds of being in receipt of
compensation. One of the provisions of the 1979 Act is that a person
who has received compensation cannot claim under that Act. There is a
procedure to follow in making both claims: a pneumoconiotic must claim
under the 1979 Act before claiming under the 1974 scheme, to get both
payments.
My concern
is about the circumstances in which payments will be reclaimed under
the 1974 scheme. For example, I can envisage that a dependant of a
deceased person who did not make a claim during his life might make a
claim under the 1974 scheme, and at the same time have a claim under
the 1979 scheme—the new 1979 scheme, which we are talking about.
That would occur because mesothelioma is a cancer caused by asbestos
and asbestosis is a form of pneumoconiosis. It is defined under the
1974 scheme. A miner, for example, can claim under the 1974 scheme if
he has developed an asbestos-induced disease; at the same time, as I
have said, since 2004 the same miner has been able to claim under the
more recent scheme.
I
can see that a situation might arise in which a dependant would make
both possible claims. Is it in such a circumstance that the Minister
envisages recouping the 1974 payment, rather than in a living case? I
should have thought that the matter moves outside the relevant scope
when we relate the Act in question to a living case. She will
know of moves that are, I understand, afoot to review the whole of the
pneumoconiosis scheme. I do not know whether that will happen sooner or
later, but will she clarify the circumstances in
which we shall recoup 1974 pneumoconiosis scheme
payments?
Mr.
Boswell:
I was going to echo the hon. Gentleman’s
points in connection with representations submitted by APIL. The main
guiding principle should be that whatever is contemplated, it should
not strike differentially between the two different arrangements; it
should be on the same basis as the civil compensation scheme, both in
relation to the treatment of dependants and in relation to any
recovery, or non-recovery, of general damages. I think that that is a
good principle, so I shall not go on about it.
I should like to say a word or
two in support of the new clause tabled by my hon. Friend the Member
for South-West Bedfordshire about information. It is clearly important,
and, when I looked into the matter in detail, I found that a number of
employers clearly did not have particularly good employment records,
and several insurers, no doubt for their own reasons—it may or
may not have been intentional—did not have very good records of
coverage either.
That
can also affect what might, in shorthand, be called compliant
employers, or compliant employer liability insurers. One of my worries
when the Government moved, in effect, to say that they would reverse
the court judgment and make any insurer liable for its part in the
scheme, was that if only one employer, and possibly only one employer
liability
insurer, could be identified—even if that employer had employed
the person who contracted the disease for only a week in a career of 40
years, and even if the illness was not directly attributable to that
week—it could in principle be liable for the whole quantum of
compensation. I am
not clear about what stage that proposal is at now, but it would be
very inequitable if that state of affairs came about, and no one in the
Committee wants to create a situation of inequity. It is clearly right
that all the insurers that are involved over a person’s career
should be engaged and should take their proportionate share of the
liability, if that is possible—or at least broadly so. Perhaps
the Minister can respond to my hon. Friend’s concerns, which are
set out well in his new clause, and give us a slightly more general
appreciation of the problem, which has troubled me for a number of
years.
Andrew
Selous:
As always, my hon. Friend is absolutely right.
There is a large issue in respect of incomplete or poor record keeping
and an issue about someone who has a work history over many years, with
perhaps one employer or one insurer being asked to take an unfair
burden in contrast with their share of
responsibility.
New
clause 21 does not really deal with either of those issues; it would
give the Department—the Secretary of State—a reserve
power where it is clear who the employer was. I have a constituency
case where a gentleman worked for 35 years for one employer, knee-deep
in asbestos, and he cannot get past his employer to get on to his
insurer. That offends me hugely and it offends a profession that I was
proud to be part of before I came into the
House.
The
Chairman:
Order. That is a rather long
intervention.
Andrew
Selous:
Thank you, Mr. Taylor. I take your
point. I hope that I have clarified
things.
Mr.
Boswell:
My hon. Friend’s clarification is useful.
There are both specific and, if I may say so in the terms of earlier
remarks, general issues of concern about ensuring that the burdens fall
where they properly should and that delinquent
employers and/or insurers—they may not be all of them or any of
them—should be identified wherever possible and encouraged to
pay their proper share of the burden. Perhaps the Minister will
enlighten us on how she is getting on with
that.
Mrs.
McGuire:
I thank hon. Members for a complicated and
detailed discussion. On pulling out the detail, we
will hopefully have a greater understanding of the Bill and where we
are going with
it.
I
thank the hon. Member for South-West Bedfordshire, whose new clause was
tabled in a spirit of opening up the dialogue about how we speed up
compensation and pursue claims through the normal compensation process
in the courts, if that is necessary. I think that all of us would agree
that civil compensation can be a pretty
long process, because there are so many arguments to consider. The key
thing in terms of the process is to get the decision
right. We are trying
to streamline the process, especially for those suffering with
mesothelioma. The new scheme is, as I have said on previous occasions
this morning, designed to get some funds quickly at the point of
diagnosis of mesothelioma, or as near to it as possible. In relation to
the civil claims for compensation—the hon. Gentleman highlighted
this—the civil procedure rules, the practice directions and the
pre-action protocols prescribe the time scales within which actions
must be carried out, so there is already a process in place. The court
can currently apply sanctions where those procedures are not complied
with. It would not be appropriate for the Secretary of State to levy
charges in these circumstances. I appreciate that the hon. Gentleman
has tabled the new clause in the spirit of trying to encourage greater
speediness in dealing with relevant cases, but it would not be
appropriate to levy
charges.
Both insurers
and personal injury lawyers have been helpful in looking at ways in
which we can speed up some of the processes, particularly in relation
to mesothelioma. I fully understand that there is
frustration when cases seem to take for ever, but although the hon.
Gentleman has tabled his new clause in the spirit of being helpful, I
am not sure that that would have the desired result and I urge him to
ask leave to withdraw
it.
My
hon. Friend asked about the recovery of payments under the 1979 Act and
the new mesothelioma scheme. As he recognises, the lump sum payments
are made in lieu of compensation. We want the compensators to be able
to deduct the amount of the lump sum payment that they are required to
repay to the Department for Work and Pensions from any part of the
compensation award, including general damages, which are highlighted
specifically for pain and
suffering.
12.30
pm
If we attach
the lump sum payment to a particular head of damage, the sufferers or
their dependants could be doubly compensated and, as we made clear
earlier and has been accepted by all sides, we do not want double
compensation to be possible. There are no plans for recoverable
benefits to be recovered from the general heads of
damages.
My hon.
Friend asked also about payments under the 1979 Act and the new
mesothelioma scheme being paid to dependants, and whether they would be
subject to compensation recovery. Payments made directly to dependants
will be subject to compensation recovery from awards made to them under
the Fatal Accidents Act 1976. Again, there are no plans for recoverable
benefits paid to the person with mesothelioma to be
recovered from the dependant or from the compensation
awarded to the dependant under that Act. I hope that I have addressed
his
concern.
Mr.
Harper:
Given that we are looking at several interactions,
may I take the Minister back to her remarks about the armed forces
compensation scheme and war pensions? She mentioned that, under the war
pensions scheme, there was no time limit on claims. Under the armed
forces compensation scheme, there is,
of course, a five-year time limit on claims, although there is provision
for dealing with late onset diseases. Will she confirm that
mesothelioma would be captured under that scheme and will she ensure
that it would not fall foul of the five-year time limit for
claims?
Mrs.
McGuire:
I shall be pleased to come back to the hon.
Gentleman with confirmation or otherwise of that specific point, which
was slightly to the side of the
discussion.
My hon.
Friend also highlighted the coal workers pneumoconiosis scheme payments
in respect of the compensation recovery scheme. I hope that the
Committee will forgive me if I go into some detail on that. It is our
intention only to recover the 1979 Act payments on new scheme payments
from subsequent awards made to a person under the coal workers’
pneumoconiosis scheme. That is to stop a person being compensated twice
for the same condition: from the Department for Work and Pensions under
the 1970s legislation or the new scheme and from the Department for
Business, Enterprise and Regulatory Reform—previously the Department of
Trade and Industry—under the CWPS. We do not intend to recover
any social security benefits that a person may receive from the CWPS
awards.
As my hon.
Friend might be aware, earlier this year BERR received a
challenge from claimants’ representatives to the action of
denying claims to the CWPS when it was understood that a compensation
payment for pneumoconiosis had already been made under the 1979 Act.
BERR’s view was that paying under both schemes would effectively
be compensating claimants doubly for the same condition. Later this
year, following legal advice, it was decided that it must pay
compensation to the CWPS in such cases. As my hon. Friend is well
aware, the 1979 Act was, in fact, never intended for miners as they had
their own compensation scheme on which that Act was based. They only
became entitled to a claim under the legislation when the British Coal
Corporation was dissolved in March 2004. I hope that I have dealt with
some of the issues raised. I advise the Committee that, since June when
BERR started to pay out the claims, it has only received a couple of
dozen claims to CWPS when payment has already been made under the 1979
Act.
As for the
broader application in respect of general damages, I shall carefully
reflect on what my hon. Friend said. I do not believe that our
proposals for lump sums have set any form of precedent. They are
intended only to apply to lump sum payments, but I shall read carefully
what he has highlighted and, if need be, we can come back to such
matters.
Clause 49
amends the Social Security (Recovery of Benefits) Act 1997 to provide
regulation-making powers to the Secretary of State for the recovery of
lump sum payments. Money generated through this compensation recovery
process will be used to fund the new mesothelioma scheme so that it is
self-funding. Lump sum payments under the new scheme will initially be
based on what the level of recoveries will allow, but the payments will
increase in subsequent years as more recoveries are made. This means
that the scheme will be self-funding.
The principles of the current
scheme are to be adopted for the recovery of lump sum payments and the
amount of the lump sum is to be recovered even if it reduces the civil
compensation award to nil. This does not disadvantage the sufferer or
their family in any way as the lump sum payment is paid in lieu of any
civil compensation. We are not taking money away that people would
otherwise have. Regulations falling out of this clause may also allow
for a lump sum payment made before the scheme is introduced to be
recovered from civil compensation awards made after it is introduced. I
ask the hon. Member for South-West Bedfordshire not to press his new
clause to a Division. Although he was trying to be helpful, there are
enough safeguards in the current system to deal with the issue that he
highlighted.
Andrew
Selous:
I am grateful to the Minister for recognising my
reason for tabling the new clause. I will not press it to a vote. I
note her comments about the court being able to levy charges, which she
thought was sufficient and there was no need for the Secretary of State
to have a power. I hope that it will not try her patience if I ask her
to write to me or to the Committee—or perhaps to respond later
today—with some indication of the frequency with which the
courts use that power. It is all very well having a reserve power, but
it needs to be something that insurers or employers have reason to
fear,
Mrs.
McGuire:
I try to be helpful to the Committee at all
times, but it would be beyond our resources between now and our next
sitting this afternoon to find out all the instances where charges have
been levied by a court through cases under the English jurisdiction,
notwithstanding the fact that we would not have time to look at the
Scottish
situation.
Andrew
Selous:
I hear what the Minister says. Without putting her
officials to too much work, would it be possible to provide any
information that the Department has on the frequency with which charges
are levied? I am not as convinced as I would have liked to be that she
shares my view about the scale of the problem and the frustration of
our constituents when some of these issues drag on so slowly. I do not
intend to press this new clause, given that she believes that the
existing powers are adequate. If they are adequate, it would be
reasonable to have some idea of the frequency of their use.
Question put and agreed
to.
Clause 49
ordered to stand part of the
Bill.
| 
