Justice committee approves compensation bill.
The Scottish government’s bill to make pleural plaques compensable moved a step closer to becoming law on Monday, when it was rubber-stamped by a committee of top MSPs.
But the Scottish parliament’s justice committee warned that ministers might not have realised the full cost of the legislation, or the risk that liability could be passed to the Scottish government by departments at Westminster.
Nick Starling, the ABI’s director of general insurance and health, said: “The justice committee is right to criticise the Scottish government’s under-estimation of the likely cost of introducing this bill.
“We believe the cost of making pleural plaques compensable will lead to significantly higher costs for the Scottish taxpayer and all Scottish firms, and make Scotland a much less attractive location for businesses to operate in.
“Under the statement of funding policy [which sets out the relationship between Westminster and Holyrood], UK government departments that may be liable for pleural plaques claims can offset those costs against the Scottish Consolidated Fund, so the Scottish government and parliament need to carefully consider the potential impact of a self-imposed budget cut, which could run to several millions of pounds.”
The justice committee’s report, published on Monday, recommended support for the Damages (Asbestos-related Conditions) (Scotland) Bill, but questioned the government’s statement that the measure would cost about £5.5m a year.
Bill Aitken MSP, the committee’s convener, said: “The committee is concerned that the figures provided by the Scottish government might not accurately reflect the full costs of the bill. Equally worrying to the committee is the potential impact on the Scottish budget if UK government departments, such as the Ministry of Defence, pass their liability on to the Scottish government.
As revealed by Insurance Times, a group of insurers is preparing to mount a legal challenge against the Scottish government to prevent it introducing legislation making pleural plaques compensable.
The insurers, which include AXA, Zurich and Norwich Union, have instructed lawyers to look at ways to prevent the bill being made law.
The Scottish bill, which was introduced in June, could jeopardise a Law Lords ruling last year that pleural plaques could not be compensated under the law of damages.
