The James Hardie Industries asbestos compensation fund is headed for a funding shortfall and is seeking approval from the NSW Supreme Court to pay some victims in installments rather than lump sums.
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Fairfax Media reported last week that the Asbestos Injuries Compensation Fund would likely have to draw on its $320 million loan facility with the NSW Government in 2015-16 to meet claims.
James Hardie on Monday said it had been advised by the AICF that a funding shortfall is likely from 2017 and that the AICF "would like to enter discussions with the company [James Hardie] and the NSW Government concerning an Approved Payment Scheme".
The Approved Payment Scheme will see some proven claims paid to victims in installments rather than as a lump sum and some other liabilities will be deferred.
Under the 2006 Amended Final Funding Agreement James Hardie, which is a building materials provider, pays up to 35 per cent of its operating cashflow into the AICF.
James Hardie paid $120 million into the fund on July 1, which is all the fund had to pay claims as of July 3 after repaying $51.6 million in interest and principal from a previous drawdown on the loan facility.
James Hardie has paid $US556 million to its own investors over the past two years.
It has paid a total of $721.4 million into the AICF since its inception in February 2007.
