Home > James Hardie may draw on loan for asbestos compensation

James Hardie may draw on loan for asbestos compensation

Editorial
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James Hardie may have to draw on a government loan to cover its asbestos compensation fund despite paying shareholders dividends of almost $600m in the last two years.

SMH reports that the company pays about 35 per cent of its operating cash flow to the Asbestos Injuries Compensation Fund (AICF).

The AICF, which was the result of an agreement between James Hardie and the NSW government, exists to compensate victims suffering from asbestos-related diseases such as mesothelioma.

In 2010, the NSW and Federal government’s set up a loan scheme to assure compensation payments would be met even if James Hardie did not have sufficient funds to do so. The tax payer-backed loans can be up to $320 million.

The number of claims has increased and it looks like the company will not be able to meet the payments without access to the loans.

Senator Nick Xenophon slammed James Hardie for getting itself in this position as it pays its shareholders large dividends.

"The bottom line is if James Hardie can afford $500 million to give to shareholders it can find the money to give to dying victims of their product," Mr Xenophon said.

"If James Hardie doesn't come to the table they deserve the scorn of the Australian public. They have got through the GFC."

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