Harvey and Russell quiz Ainsworth on the Armed Forces Compensation Scheme

• [Feb 10] Nick Harvey (North Devon) (LD): ' . . WHAT is it all going to cost? I know that that is hard to estimate, but the Government seem a little coy about it. There is a strong moral argument, whatever it costs, that it is the right thing to do, but I would welcome an estimate-they must have one-of what they think it will cost. . . '

I echo the words of tribute to those who have fallen in the past few days in Afghanistan; I salute their courage and valour.

I thank the Secretary of State for his statement and, indeed, for the briefing earlier today. The Government were right to introduce the scheme in 2005, but today's statement shows that it has not worked as well as it might have done since then. I am pleased that the Government have changed course, because, as the hon. Member for Woodspring (Dr. Fox) said, the sight of court cases fought over levels of compensation was not edifying. Admiral Boyce has done a very good job. He and his team have made some positive recommendations, which I welcome, on the levels of compensation, the easier time scales, the slight readjustment of the burden of proof and, in particular, the greater recognition of mental illness than has been the case to date.

What is it all going to cost? I know that that is hard to estimate, but the Government seem a little coy about it. There is a strong moral argument, whatever it costs, that it is the right thing to do, but I would welcome an estimate-they must have one-of what they think it will cost.

Lord Boyce said that he was trying to establish a system involving a comparator between the awards and those in civil life. I know that it is hard to make such comparisons, because the scheme involves an ongoing payment, which would be most unusual in civil cases. The Secretary of State says that the scheme will be kept under constant review, which is welcome, but I urge him to guarantee that the comparator with civil compensation remains part of the ongoing review process.

The Secretary of State also said in his statement that the quality of medical intervention was so advanced that many more lives were now saved than in the past. That is undoubtedly correct. It means that, at the point of the initial intervention, more compensation is needed than has ever been needed before. I welcome the fact that the statement acknowledges that. As he keeps these matters under review, will he also recognise that we will be entering uncharted territory, and that we might need to come back after several years, or even decades, to see how those people with very serious problems have been doing over the longer term, and whether their level of support needs to be revisited on account of factors that we cannot anticipate or even imagine at this stage?

Mr. Ainsworth: I thank the hon. Gentleman for many of his comments. He mentioned the 2005 scheme. Let us remember that that represented a massive improvement on what went before. There was no lump sum payment and no ability to claim during service before the introduction of that scheme. I make no apology for wanting to make a significant difference with a lump sum payment for the most seriously injured. We did that in 2008, and Lord Boyce has now effectively readjusted the differentials to take into account the improvements that we made. That represents yet further improvement.

What will it cost? I did not say to Lord Boyce that we must keep within a particular envelope, as I do not believe that that is appropriate. I hope that hon. Members of all parties would agree with that. We have a commitment-a moral commitment-to these individuals that we must meet, and we have to meet the costs. Yes, they will have to come from the defence budget, but I do not think that it is unaffordable. We should not place it within any financial constraint: it has to come first and it has to be funded in full.

As to the need for ongoing reviews, I would make two points to the hon. Gentleman. First, by building in this expert medical panel, which will start considering issues such as hearing and other complicated difficulties that people have to confront, Lord Boyce has potentially brought some flexibility to the system. I cannot say to what degree that will need to be reviewed, because the expert panel will continually be able to bring back issues into the development of the compensation payable.

Secondly, the hon. Gentleman should remember that the guaranteed income payment is tax-free and inflation-proofed, so we will not have to review that. I am personally particularly pleased-this is one area that I wanted to see addressed-that we have effectively uplifted the guaranteed income payment to take into account the progression that a young soldier is likely to have made during his career. That is a big improvement, because it is not right to assume that a 20-year-old would have stayed at the same level of remuneration for the rest of his life. His ability to have climbed the ranks and to have made progress in life must be taken into account.

I believe that we have a pretty robust situation now, but of course we must keep it under review. My hon. Friend the veterans Minister will do so in consultation with the groups that have helped us. We have had the involvement and support of the Royal British Legion, the British Limbless Ex-Servicemen's Association, the Confederation of British Service and Ex-Service Organisations and the War Widows Association. The Families Federation was also represented on the group that supported us. We will continue to take those views into account.

• . . Bob Russell (Colchester) (LD): Will the Secretary of State confirm that the level of compensation from the Criminal Injuries Compensation Authority for an off-duty soldier who receives serious head injuries as a result of being assaulted in the UK will still be considerably more than the compensation available under the armed forces compensation scheme if that same young man suffers serious head injuries as a result of being shot in Afghanistan while on active service for his country?

Mr. Ainsworth: Lord Boyce tried as best he could to consider comparators in this country and abroad. That is enormously difficult, because the structure of other countries' armed forces and welfare states is very different from our own. Lord Boyce could not say, did not say and shied away again this morning from saying that this country has the best scheme; ours is among the most generous. This is not a contested court-case scheme; it is a no-fault compensation scheme for our armed forces.