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Pike River families cheated out of compensation

5 July 2013

Pike River families cheated out of compensation

Pike River families have been cheated out of their full legal compensation entitlements and the Government should look at steps to ensure the full legal compensation of $110,000 is paid to each family.

“It is a travesty of justice that the Pike River families could end up with as little as $5000 in compensation when they are legally entitled to much more,” said Green Party Pike River spokesperson Kevin Hague.

“These families should be at the front of the queue for compensation and payment, but because the legal system puts them at the back, they could walk away with very little.

“Pike River was only covered for two million in liability insurance. That is a totally inadequate amount for an operation with such a high risk profile and it has left the families with crumbs.

“It is wrong that the families only get the leftover insurance money once everyone else gets in first. Presumably the rest of the two million has been eaten up in lawyers’ fees, so again the families are at the back of the queue.

“Pike River directors and shareholders have escaped completely unpunished. They should have to top up the gap between the compensation awarded and the amount the company has to pay.

“This case highlights a gap in the law that means companies can limit their liability to such a degree that they pervert the law by not having sufficient funds to pay out in Health and Safety cases.

“The Government should investigate the possibility of legislative amendments so that in case of negligence Directors can be pursued for compensation if their company cannot pay.

“It is wrong that victims and their families are always at the back of the queue and their compensation is a nice to have, if a company can afford it.”

ends

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