Nazi labour compensation agreed

Agreement has been reached on how to allocate the money from a £3 billion fund to compensate Nazi-era slave and forced labourers, resolving the last major point of contention after months of negotiations.

Agreement has been reached on how to allocate the money from a £3 billion fund to compensate Nazi-era slave and forced labourers, resolving the last major point of contention after months of negotiations.

All negotiators were to meet in a plenary session to approve the deal.

The agreement would allocate most of the money to compensating slave and forced labour victims and another, with the remaining fifth of the cash used to cover claims for bank accounts and insurance policies stolen by the Nazis.

Another £200m will be used for a foundation that will sponsor research and projects around the theme of Nazi labour.

BC-Germany-Nazi Labor, 1st Ld-2nd Add

Since all sides agreed in December on the fund, negotiators had been wrangling over how to divide the money among the various groups to be covered.

Eastern European countries had been pushing to get the most money possible to cover victims of the Nazis' labour practices, while German industry insisted that the foundation for future projects was an integral part of the effort. Jewish groups had wanted to make sure an appropriate amount was allocated for the other bank and insurance claims.

Under the deal, slave labourers - those who were put to work in concentration camps and expected to die doing their job - would receive up to 15,000 marks (£4,500) each. Forced laborers, who worked in factories outside camps, would get up to 5,000 marks (£1,500 each).

Chancellor Gerhard Schroeder's Cabinet approved a bill to set up the fund, which is to be financed in equal parts by the government and German industry.

Estimates about how many people could benefit from the fund range from 800,000 to 2.3 million. Most are non-Jews from Eastern Europe who had been left out of previous compensation efforts because they were behind the Iron Curtain.

Germany has paid about £40 billion under other compensation for Nazi-era wrongs since World War II.