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Confederation of British Industries

Committee for Finance and Personnel

Damages (Asbestos-Related Conditions) Bill

Written Evidence from the Confederation of British Industries

NI 05 11

Damages (Asbestos -related conditions) Bill - CBI submission to the Finance and Personnel Committee

  1. CBI welcomes the consultation being undertaken by the Finance and Personnel Committee as part of its consideration of the Damages Bill, which will introduce compensation for pleural plaques.
  2. While recognising that the call for evidence is focused at requests for specific amendments to the Bill or opposition to specific clauses, on this occasion the CBI is deeply concerned at the general principles of the Bill, the inadequacy of the Regulatory Impact Assessment which underpins it, and the negative budgetary impact the Bill is likely to create and which we do not believe has been fully assessed.
  3. The CBI's key concerns are set out as follows:
    • the medical evidence supports the view that pleural plaques are an indication of exposure to asbestos but that they are not in themselves an injury or disease - the House of Lords ruled in 2007 that they are benign and do not themselves constitute any physical impairment on those that have them
    • the Bill to overturn this House of Lords judgement will lead to a fundamental change to the law of negligence - for the first time compensation will be payable on the basis of something other than an actual injury. This could create an unwelcome precedent and create additional uncertainty for businesses and insurers
    • we recognise the legitimate concerns about the need for better information about pleural plaques - this can best be done through increasing the amount of accurate information about them
    • the Bill will create confusion and add to the general lack of knowledge and misunderstanding associated with pleural plaques by saying that pleural plaques should be compensatable and thus indicating that they are a serious condition. This is likely to create more anxiety for those that have been diagnosed with pleural plaques,and also removes the focus on those who have asbestosis, who clearly do need to be compensated
    • The financial estimates of the costs of compensation are not rigorous and we believe could seriously underestimate the levels of claims and associated costs. This will impact not just on the business community but on departmental budgets including DETI where £12 million has been allocated over the next four year budget period - this is likely to be a serious underestimate if past trends continue and outstanding claims progress. With legal costs exceeding the compensation costs the total cost of this Bill is likely to be a magnitude higher than has been previously estimated. At a time when the DETI draft budget states that 'good projects will not be able to be supported' and 'the amount of new business that Invest NI can support will be curtailed' the rushed introduction of this Bill is even more surprising
    • The Bill is also likely to create demand within the health service by increasing the demand for x-rays and CT scans which are the only way to properly diagnose asymptomatic pleural plaques
    • Finally the importance of the Bill and the fundamental change to the law of negligence which it brings is likely to mean the introduction of the legislation will follow similar developments in Scotland with costly judicial reviews - the only winners being the lawyers
  4. There are significant uncertainties associated with this Bill, including the estimated cost implications, as well as major points of principle. We understand there are also human rights issues which should be considered. We urge the Committee to be cautious, to fully assess the major implications of passing this Bill and not to rush to judgement on a piece of legislation which could have significant unintended consequences.
CBI Northern Ireland 
20 January 2011

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