Japan passed a law today to create a state-backed entity that will pay damages worth tens of billions of dollars to the victims of the Fukushima nuclear disaster.
The government is expected to pitch in an initial 2 trillion yen ($26 billion) in the form of special government bonds, Kyodo News has reported, but the eventual cost is expected to be far higher.
Under the bill, which passed through the upper house, embattled operator Tokyo Electric Power Company (TEPCO) and other atomic power companies will also pay into the fund, which will then compensate the victims.
The world’s worst nuclear disaster since Chernobyl 25 years ago has forced the evacuation of more than 80,000 people from a 20-kilometre (12-mile) zone around the tsunami-hit plant and more from radiation hotspots beyond.
The nuclear crisis, sparked by the powerful March 11 quake and tsunami, has also heavily impacted the farm, fisheries and tourism sectors.
It said TEPCO, whose share price has plummeted 80 per cent since the quake, would have to eventually pay back all funds it receives from the body. The utility would also be restructured under government supervision.
The government and TEPCO have faced harsh criticism for slow progress in distributing compensation and aid money to residents, farmers and businesses near the plant who had to flee to escape nuclear contamination.
TEPCO, one of the world’s biggest power companies, supplies Tokyo and the Kanto region, which is at the heart of the world’s third-biggest economy and accounts for more than one third of Japan’s gross domestic product.