OFF THE MARKET: A shopping assistant sorts dairy products in a supermarket in Meishan City, Sichuan Province. Starting August 1 this year, any enterprise not possessing a proper license will be banned from the distribution business (YAO YONGLIANG)

Almost three years after the Sanlu milk scandal that caused thousands of infants in China to develop urinary disease after drinking melamine-tainted powdered milk, the first report on compensation issues for the victims has finally been issued.

A 1.11-billion-yuan ($170 million) compensation fund has been set up for victims of the scandal and their families, the China Dairy Industry Association (CDIA) said on May 29. The compensation fund includes 910 million yuan ($140 million) for medical bills and a one-off compensation and 200 million yuan ($30.76 million) reserved to pay for possible future medical expenditures until the victims turn 18.

"Although medical experts have affirmed that each baby's excretory system is in good shape, there exists the very low probability that the babies affected will develop diseases sometime later in life. We set up the reserve fund out of a sense of responsibility for each victim's future," the CDIA said.

By the end of last year, families of the 271,869 children who were sickened after drinking the melamine-tainted products had accepted one-off compensation. Only a few affected families have yet to be reached mainly because of incorrect or false names and addresses. The compensation will be available to them until February 2013. After that, all unclaimed compensation will go toward the reserve fund.

The China Life Insurance Co. is entrusted to manage the reserve fund because its extended service network can facilitate medical expense reimbursement for affected families, the CDIA said.

As a large state-owned enterprise, China Life Insurance is willing to manage the fund for free. It has established a special account for the fund and appointed staff members exclusively for this job. A service hotline, 95519, has also been set up to assist victims with reimbursing medical expenses related to after-effects of the tainted milk.

By the end of April 2011, a total of 10.48 million yuan ($1.61 million) of the reserve fund had been paid out to 1,794 victims. The current balance of the fund is 192 million yuan ($29.5 million), including interest.

Doubts

Three years have passed since the Sanlu milk scandal broke, but the pain and suffering of the infant victims and their families have yet to completely heal. In those three years, compensating the victims has stayed in the spotlight thanks to the media and society.

Unfortunately, the CDIA failed to produce a timely response. The CDIA's recent statement was not only too late, but also lacked transparency and persuasiveness.

"How the 200 million yuan reserve fund, which should cover medical bills until those affected turn 18, has been used is still unknown. The affected children and the public want an explanation," said Han Han, a commentator with The Beijing News.