Compensation for tainted blood will not threaten tax cuts later this year, Treasury sources say

Around 3,000 people are believed to have died as a result of the scandal. Photo: Peter Daisley

Compensation to be announced this week Victims of the infected blood scandal will not be able to prevent tax cuts later this year, The Sunday Telegraph has reported.

Although billions will be announced on Tuesday for those who were mistakenly infected with HIV and hepatitis C because Like their loved ones, government sources said they were confident they would still have the opportunity to cut taxes in the fall.

The infected blood scandal has been described as the biggest treatment disaster in the history of the NHS.

Between 1970 and 1991, thousands of people with hemophilia and other bleeding disorders became infected with HIV and hepatitis viruses after receiving a blood clotting agent called factor VIII.

Other people were infected when blood transfusion after surgery or childbirth. . It is estimated that around 3,000 people died as a result of the scandal.

Sir Brian Langstaff — Chairman of the Contaminated Blood Inquiry Photo: ©Eddie Mulholland

Final report of Sir Brian Langstaff, Chairman of the Infected Blood Inquiry, is due to be published on Monday.

The total cost of compensation to the Treasury is estimated to be somewhere between £10 billion and £10 billion. 20 billion, although the total amount is not expected to be announced this week.

However, the large sums have led to speculation it could limit Rishi Sunak's ability to put more money in people's pockets ahead of the election. Autumn election announcement.

But government sources say such proposals are untrue.

A Treasury source said that because the compensation would be a one-off rather than regular, it was unlikely to jeopardize the government's fiscal rule that debt is forecast to fall in five years.

Interim compensation payments

Senior A government source agreed with that assessment, saying most of the costs would be repaid relatively quickly.

The Telegraph reported on Saturday that those infected in the scandal would receive new interim compensation payments this summer.

The government believes the bulk of the compensation will go to the wider group of people «affected» by the scandal — such as parents of infected children, siblings, carers and dependents of the deceased — and will likely be spread over a two- or three-year period. After this period, payments are expected to be smaller but still significant.

The senior government source also noted that other factors, such as assumptions about future spending, would influence the stock level in the autumn statement.

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«Adjustments could be made elsewhere» to make room for tax cuts, they said.

Double tax

The fact that the Government remains committed to tax relief in the Autumn Statement was confirmed by Chancellor Jeremy Hunt on Friday.

On Friday In his speech, Mr Hunt hinted that he could cut National Insurance contributions further at a fiscal event.

“If we can afford go ahead and responsibly cut the double labor tax this fall, that's what I'll do. we will,» he said.

The Telegraph understands there is a «huge range» in the total amount that could be paid in compensation for the tainted blood scandal, partly due to the «high level of uncertainty» about how many applicants there will be.

Another government source said ministers understand the need to act quickly due to the deteriorating health of some survivors.

“There is uncertainty about the moral case for this,” — said the source. «People are dying.»