Millions paid to milk scandal victims

As of the end of 2011, more than 12 million yuan ($1.9 million) in compensation has been paid to children poisoned by milk contaminated with melamine, insurance company China Life announced on its website on Monday.

Six infants were killed and about 300,000 others were sickened after drinking tainted milk in 2008, according to data released by the Ministry of Health. Former dairy giant Sanlu Group, based in North China's Hebei Province, and 21 other dairy companies were found to have contaminated their products with melamine, a chemical that could cause kidney problems.

Through the mediation of China Dairy Industry Association, the 22 companies set up a fund worth 200 million yuan to compensate victims and their families. The money will be used to treat any chronic symptoms victims may experience as a result of the poisoning before they turn 18.

China Life is being entrusted by the association with managing the fund. Launched in July 2009, the fund had been used to treat 2,055 children by the end of 2011, according to the online announcement of China Life. Nearly 3.4 million yuan of that was paid to 512 children in 2011, according to the announcement.

The tainted milk scandal drew national attention when 14 infants below the age of 1 in Northwest China's Gansu Province were diagnosed with kidney stones in 2008.

Soon thereafter, more cases from various provinces were reported and in September, the health department of Northwest China's Gansu province announced that the 59 sickened infants had all consumed the same brand of powdered milk.

One day later, Sanlu Group, which went bankrupt five months after the scandal broke, admitted that its milk farmers adulterated their dairy products with melamine in order to pass tests of the protein content.

Meanwhile, the General Administration of Quality Supervision, Inspection and Quarantine conducted an inspection of 109 companies that were making infant formula, and 22 of them had made tainted powdered milk for infants, including Sanlu Group.

These companies altogether allocated 1.11 billion yuan to compensate the infants and their families. Of this figure, 910 million yuan is for initial compensation, and the other 200 million is used as a medical compensation fund.

The tainted milk scandal had a long-term impact on consumption trends among the general public.

About 49 percent of the Chinese mothers polled said they thought high-priced powdered milk was of better quality, according to a recent survey conducted by a foreign formula producer.

The price of a particular brand of imported powdered milk was four times higher than that found on its official online store based abroad, according to a report by Guangzhou Daily.

The listed price of the organic infant powdered milk on the official website of German Te Fufen milk is 9.95, which is about 80.05 yuan and a quarter of its price on the mainland, found the report.

"A German-made organic infant powdered milk that I usually buy from the super market Jusco was 318 yuan for 600 grams, which is almost twice the price I bought from abroad via online dealers," a mother told the newspaper.

The extra costs of the imported canned milk powder mainly comes from import duties and inspection fees, which account for 28 to 30 percent of its original price, the paper quoted Wang Dingmian, chairman of the Guangzhou Dairy Association, as saying.