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.
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.
