Milk fund statement too vague, critics say

PUBLISHED : Thursday, 09 June, 2011, 12:00am
UPDATED : Thursday, 09 June, 2011, 12:00am


The China Dairy Industry Association, which set up a compensation fund for victims of the melamine-tainted milk scandal two years ago, has finally released details after weeks of media grilling. But parents and lawyers criticised its statement as vague, arrogant and unacceptable.

The association said the fund, set up in July 2009, had 1.1 billion yuan (HK$1.3 billion) from 22 dairy companies. At least six children died and 300,000 others were made ill with kidney problems because firms added the industrial chemical melamine to baby formula to fool protein tests.

Some 200 million yuan was set aside for covering victims' medical bills until they turn 18. Another 910 million yuan was earmarked for one-off compensation and emergency medical treatment, a statement posted on the association's website said.

It said 1,794 people had 10.48 million yuan of medical bills reimbursed by April 30, with some 192 million yuan remaining in the account. But the association failed to release details about one-off compensation, briefly mentioning that 271,869 families had received payouts without giving a detailed breakdown. It was unclear how much money has been paid and how much is left in the account. Also unclear were figures for different compensation categories.

According to Ministry of Health standards, families of children killed by the tainted milk will receive 200,000 yuan, those with severe symptoms 30,000 yuan and those with regular symptoms 2,000 yuan.

'Those very few parents who have not claimed the compensation can do that any time where they live by February 2013. The compensation which is not claimed will be used as medical reimbursement funds,' the statement said.

The vague statement was the first official response after weeks of appeals by mainland media for the association to open up the management and operation of the fund.

Both the association and the 200 million yuan reimbursement fund operator, China Life Insurance, told Oriental Outlook magazine last month that they could give no information about the fund because it was an industry or state secret and details could not be made public.

A dairy association official said it was only responsible for setting up the fund and 'we suggest media not report on the fund'.

Activist Zhao Lianhai, who went to the association's headquarters in Beijing to ask about the fund last month but was turned away, criticised the statement as insincere and vague. 'The statement does not say how much was spent compensating families and how they were compensated according to which category. We think it's necessary that they release detailed information and we need to verify them one by one.'

He said he had heard of cases where families without sick children were given 2,000 yuan.

Peng Jian, a lawyer who represents the parents of victims, said the statement was unacceptable and called for the association to release more details about how the compensation fund was used and how much interest it had earned.