Legislation to establish a statutory public inquiry and a statutory redress scheme was announced by Northern Ireland’s first minister and deputy first minister on Monday.

The Inquiry (Mother and Baby Institutions, Magdalene Laundries and Workhouses) and Redress Scheme Bill will establish a statutory public inquiry with similar powers to the Inquiries Act 2005 and a process is under way to appoint a designate chair.

The legislation will also cover the initial redress scheme, called the ‘standardised payment’ (SP), and establish an independent body to administer payments.

A further ‘individually assessed payment’ (IAP) scheme will follow in a separate piece of legislation once the public inquiry has concluded.

The estimated cost is £80 million, which includes almost £60m in initial redress payments to cover approximately 6,600 redress claims.

Each eligible person will receive a payment of £10,000 and a £2,000 payment will be made to each eligible family member on behalf of a loved one who has died since 29 September 2011.

However, Belfast firm KRW Law said yesterday that the legislation as it currently stands would exclude “many survivors” from eligibility for redress.

It said confining posthumous claims on behalf of deceased birth mothers and children to those who died after 2011 “cuts out a huge swathe of prospective applicants”.

The firm has also challenged the exclusion of workhouse victims from the standardised payment scheme and the exclusion of foster care home survivors from the proposals, as well as the impact of inflation on the proposed payments.

Aine Rice, solicitor in KRW Law’s historic abuse team, said: “So much work has been put in by many people to get to this stage only for it to be undone in one fell swoop. There is an insensitivity underpinning all of this which makes it galling.

“We reject the current proposals as unfit for purpose. More — much more — needs done to address the imbalance in play here.

“We need to see a complete U-turn by the time we reach the next stage of the bill, but time is running out fast.

“We are told today that many are thinking of leaving the consultation forum and threatening protest. Today’s news is both underwhelming and depressing.”

Survivor Marie Arbuckle added: “The latest proposals are a kick in the teeth for many survivors. It seems to me that the government hasn’t listened to us properly at all. Why do a consultation in the first place if the wishes and hopes of survivors aren’t taken on board?

“I don’t believe lessons have been learned from what happened in the south of Ireland. The understandable drive to save money has simply gone too far and all at the expense of the wishes of victims.

“We have lost all confidence in the process we worked so hard on for the last three years.”