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Lawyers for Harrods are proposing six-figure payouts to settle claims brought by sexual abuse victims of the London department store’s former owner, Mohamed al Fayed.

Sky News has learnt that MPL Legal, which is coordinating a redress scheme on behalf of the world-famous retailer, has told potential claimants that they could be eligible for general damages lump sums of up to £110,000 or £200,000, depending upon claimants’ willingness to submit to a psychiatric assessment arranged by the company.

A document seen by Sky News suggests that victims of Mr al Fayed who choose a “non-medical pathway” would be eligible for “general damages limited to compensation for sexual assault of up to £110,000”, with “aggravated damages [of] up to £15,000”, and “wrongful testing fixed payment(s) up to £7,500”.

Claimants who agree to an assessment by a scheme consultant psychiatrist – referred to in the document as the “medical pathway” – would be eligible for general damages of up to £200,000, further payments equivalent to those potentially awarded to non-medical claimants, as well as treatment costs “past and future supported by the medical report” and a “work impact payment capped at £110,000”.

The “wrongful testing” payments refer to women who were forced to undergo unnecessary and intrusive medical examinations demanded by Mr al Fayed, while the “work impact payments” relate to loss of earnings triggered by, for example, the unjustified termination of victims’ employment at Harrods.

The draft terms raise the prospect that some of the former Harrods owner’s victims could receive payments of more than £300,000.

However, the decision to impose a further psychiatric assessment in order to access the largest sums available under the scheme may anger claimants who have already endured years of psychological trauma after being abused by Mr al Fayed.

More on Mohamed Al Fayed

Those who opt to pursue the “medical pathway” nevertheless face a protracted wait to receive their payouts.

The MLP document said it would take up to six months to produce a medical report, after which a claimant would have 21 days to submit questions relating to it.

An offer of compensation would then be made within 35 days, it said, after which a claimant could accept the offer, appeal to an Independent Appeals Panel or leave the scheme and pursue an alternative form of redress.

The proposed terms are understood to be preliminary and subject to ongoing consultation, and will not be concluded until the end of this month, according to sources close to the process.

If the scheme is finalised along lines similar to those being consulted on, it would likely result in a total compensation bill for Harrods running to tens of millions of pounds.

The final cost of compensating victims of a man now regarded as one of Britain’s most notorious sex offenders will, though, be unclear until the number of claimants and their decisions about which compensation route to pursue have been determined.

Responding to an enquiry from Sky News this weekend, a Harrods spokesperson said: “It would be premature for us to comment on the nature and details of a scheme that is currently under consultation.

“We are actively inviting the valuable input from Survivors and their legal representatives to establish the final scheme that aims to be survivor-first, trauma-informed, and fair in its approach to compensation.

“Further updates will be provided once the consultation period is complete.”

Details are, however, expected to be finalised in the coming days.

Read more: A timeline of al Fayed sex abuse claims

According to a document published on a website set up by MPL Legal for the purposes of administering the redress scheme, “Harrods and MPL Legal are undertaking a period of consultation regarding the compensation scheme in which we will receive detailed feedback from interested parties, including several legal firms representing survivors, leading Counsel and Dame Jasvinder [Sanghera], the Independent Survivor Advocate”.

“It is anticipated the final compensation scheme will be published and survivors will be able to access application forms from 31 March 2025.”

Mr al Fayed, who died in 2023, owned Harrods for 25 years, selling it in 2010 to Qatar Holding, one of the Gulf state’s sovereign wealth funds, for £1.5bn.

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‘Many more’ likely abused by Fayed

His reign of terror at the Knightsbridge store is thought to have involved hundreds of predominantly young female victims, with former Fulham women’s players also alleging sexual abuse by the billionaire Egyptian.

Mr al Fayed also owned Fulham Football Club for a number of years.

The MPL Legal document seen by Sky News said the redress scheme would “provide options for survivors – an alternative route to the court process”, and that it would “hopefully avoid an adversarial approach which also risks retraumatising survivors”.

It added that the scheme would be “as inclusive as possible – we want the scheme to work for as many survivors as we can”.

Under the heading “Scheme principles”, MPL said it represented “an alternative to litigation, but a survivor can leave the scheme at any time and pursue the claim through the court system”.

It said it hoped that law firms engaging with the scheme “will ensure survivors receive 100% of the compensation”.

“The level of compensation available through the scheme has been designed to mirror the court’s approach,” it added.

Read more:
‘I had to barricade myself in bedroom during work trip’, accuser says
Ex-flight attendant says she was sacked for refusing to sleep with al Fayed

It also said there were “certain classifications of cases which may not be suitable for the scheme, for example if a survivor wishes to claim a full loss of earnings”.

Last October, lawyers acting for victims of Mr al Fayed said they had received more than 420 enquiries about potential claims, although it is unclear how many more have come forward in the six months since.

In a section headed “Eligibility”, MPL Legal said Harrods “retains discretion to review eligibility on a case by case basis”.

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Bianca Gascoigne said she was groomed and sexually assaulted by al Fayed when she worked at Harrods

The date of the MPL Legal document’s creation was unclear on Saturday, but one legal source said it had been produced “recently”.

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UK economy figures not as bad as they look despite GDP fall, analysts say

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UK economy figures not as bad as they look despite GDP fall, analysts say

The UK economy unexpectedly shrank in May, even after the worst of Donald Trump’s tariffs were paused, official figures showed.

A standard measure of economic growth, gross domestic product (GDP), contracted 0.1% in May, according to the Office for National Statistics (ONS).

Rather than a fall being anticipated, growth of 0.1% was forecast by economists polled by Reuters as big falls in production and construction were seen.

It followed a 0.3% contraction in April, when Mr Trump announced his country-specific tariffs and sparked a global trade war.

A 90-day pause on these import taxes, which has been extended, allowed more normality to resume.

This was borne out by other figures released by the ONS on Friday.

Exports to the United States rose £300m but “remained relatively low” following a “substantial decrease” in April, the data said.

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Overall, there was a “large rise in goods imports and a fall in goods exports”.

A ‘disappointing’ but mixed picture

It’s “disappointing” news, Chancellor Rachel Reeves said. She and the government as a whole have repeatedly said growing the economy was their number one priority.

“I am determined to kickstart economic growth and deliver on that promise”, she added.

But the picture was not all bad.

Growth recorded in March was revised upwards, further indicating that companies invested to prepare for tariffs. Rather than GDP of 0.2%, the ONS said on Friday the figure was actually 0.4%.

It showed businesses moved forward activity to be ready for the extra taxes. Businesses were hit with higher employer national insurance contributions in April.

Read more:
Trump plans to hit Canada with 35% tariff – warning of blanket hike for other countries
Woman and three teenagers arrested over M&S, Co-op and Harrods cyber attacks

The expansion in March means the economy still grew when the three months are looked at together.

While an interest rate cut in August had already been expected, investors upped their bets of a 0.25 percentage point fall in the Bank of England’s base interest rate.

Such a cut would bring down the rate to 4% and make borrowing cheaper.

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Is Britain going bankrupt?

Analysts from economic research firm Pantheon Macro said the data was not as bad as it looked.

“The size of the manufacturing drop looks erratic to us and should partly unwind… There are signs that GDP growth can rebound in June”, said Pantheon’s chief UK economist, Rob Wood.

Why did the economy shrink?

The drops in manufacturing came mostly due to slowed car-making, less oil and gas extraction and the pharmaceutical industry.

The fall was not larger because the services industry – the largest part of the economy – expanded, with law firms and computer programmers having a good month.

It made up for a “very weak” month for retailers, the ONS said.

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UK economy remains fragile – and there are risks and traps lurking around the corner

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UK economy remains fragile - and there are risks and traps lurking around the corner

Monthly Gross Domestic Product (GDP) figures are volatile and, on their own, don’t tell us much.

However, the picture emerging a year since the election of the Labour government is not hugely comforting.

This is a government that promised to turbocharge economic growth, the key to improving livelihoods and the public finances. Instead, the economy is mainly flatlining.

Output shrank in May by 0.1%. That followed a 0.3% drop in April.

Ministers were celebrating a few months ago as data showed the economy grew by 0.7% in the first quarter.

Hangover from artificial growth

However, the subsequent data has shown us that much of that growth was artificial, with businesses racing to get orders out of the door to beat the possible introduction of tariffs. Property transactions were also brought forward to beat stamp duty changes.

More from Money

Read more:
Trump to hit Canada with 35% tariff
Woman and three teens arrested over cyber attacks

In April, we experienced the hangover as orders and industrial output dropped. Services also struggled as demand for legal and conveyancing services dropped after the stamp duty changes.

Many of those distortions have now been smoothed out, but the manufacturing sector still struggled in May.

Signs of recovery

Manufacturing output fell by 1% in May, but more up-to-date data suggests the sector is recovering.

“We expect both cars and pharma output to improve as the UK-US trade deal comes into force and the volatility unwinds,” economists at Pantheon Macroeconomics said.

Meanwhile, the services sector eked out growth of 0.1%.

A 2.7% month-to-month fall in retail sales suppressed growth in the sector, but that should improve with hot weather likely to boost demand at restaurants and pubs.

Struggles ahead

It is unlikely, however, to massively shift the dial for the economy, the kind of shift the Labour government has promised and needs in order to give it some breathing room against its fiscal rules.

The economy remains fragile, and there are risks and traps lurking around the corner.

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Is Britain going bankrupt?

Concerns that the chancellor, Rachel Reeves, is considering tax hikes could weigh on consumer confidence, at a time when businesses are already scaling back hiring because of national insurance tax hikes.

Inflation is also expected to climb in the second half of the year, further weighing on consumers and businesses.

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Government to announce new scheme as it ramps up AI adoption with backing from Facebook owner Meta

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Government to announce new scheme as it ramps up AI adoption with backing from Facebook owner Meta

The government is speeding up its adoption of AI to try and encourage economic growth – with backing from Facebook parent Meta.

It will today announce a $1m (£740,000) scheme to hire up to 10 AI “experts” to help with the adoption of the technology.

Sir Keir Starmer has spoken repeatedly about wanting to use the developing technology as part of his “plan for change” to improve the UK – with claims it could produce tens of billions in savings and efficiencies.

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The government is hoping the new hires could help with problems like translating classified documents en masse, speeding up planning applications or help with emergency responses when power or internet outages occur.

The funding for the roles is coming from Meta, through the Alan Turing Institute. Adverts will go live next week, with the new fellowships expected to start at the beginning of 2026.

Technology Secretary Peter Kyle said: “This fellowship is the best of AI in action – open, practical, and built for public good. It’s about delivery, not just ideas – creating real tools that help government work better for people.”

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He added: “The fellowship will help scale that kind of impact across government, and develop sovereign capabilities where the UK must lead, like national security and critical infrastructure.”

The projects will all be based on open source models, meaning there will be a minimal cost for the government when it comes to licensing.

Meta describes its own AI model, Llama, as open source, although there are questions around whether it truly qualifies for that title due to parts of its code base not being published.

The owner of Facebook has also sponsored several studies into the benefits of government adopting more open source AI tools.

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Minister reveals how AI could improve public services

Read more:
UK to be AI ‘maker not taker’ – PM
Govt AI adviser stands down

Mr Kyle’s Department for Science and Technology has been working on its mission to increase the uptake of AI within government, including through the artificial intelligence “incubator”, under which these fellowships will fall.

The secretary of state has pointed to the success of Caddy – a tool that helps call centre workers search for answers in official documents faster – and its expanding use across government as an example of an AI success story.

He said the tool, developed with Citizens Advice, shows how AI can “boost productivity, improve decision-making, and support frontline staff”. A trial suggested it could cut waiting times for calls in half.

My Kyle also recently announced a deal with Google to provide tech support to government and assist with modernisation of data.

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Joel Kaplan, the chief global affairs officer from Meta, said: “Open-source AI models are helping researchers and developers make major scientific and medical breakthroughs, and they have the potential to transform the delivery of public services too.

“This partnership with ATI will help the government access some of the brightest minds and the technology they need to solve big challenges – and to do it openly and in the public interest.”

Jean Innes, the head of the Alan Turing Institute, said: “These fellowships will offer an innovative way to match AI experts with the real world challenges our public services are facing.”

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