Following earlier criticism in the Commons last week,

Mr Leigh, MP for Gainsborough, near Grimsby, and chairman of the Commons public accounts committee, said the compensation scheme to fishermen who lost their jobs after the last cod war was “overly complicated and mirrored many of the mistakes made in a similar programme to compensate former coal miners suffering from ill health”. Criticism has also been levelled at the large sums paid to law firms and individual lawyers for securing compensation to miners.

The cod wars were a largely peaceful face-off between Britain and Iceland in the 1970’s over fishing rights between the two countries. Ships were rammed and nets were cut, and in the end Britain lost its access to the waters around Iceland.

Although the fishing industry collapsed in 1976, the compensation scheme was only launched in 2000 after a sustained campaign by Grimsby MP Austin Mitchell.

According to the report, the Department for Trade and Industry devised the compensation scheme without having a clear understanding of working practices in the fishing industry and without holding consultations with those most affected by the cod wars.

Claimants to the scheme have been paid over £42 million since 2000, but many are still feeling frustrated, particularly by long delays. There are 4,400 former trawlermen and their dependents covered by the scheme.

Mr Leigh said: "When designing a compensation scheme, potential claimants ought to be front and centre in the thought process. But the department didn't understand the working practices of the fishing industry at the time, nor did it consider what evidence was necessary or available when drawing up the criteria for compensation.

"Following the coal health compensation scheme and trawlermen compensation scheme, two high profile examples of how not to administer such schemes, let's hope government departments will learn the lessons for any similar programmes in the future."

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