By Julian O'Halloran
File On 4
When the government brought in its new armed forces compensation scheme three years ago it hoped for plaudits.
L/Cpl Compton got an improved pay-out after a sustained campaign
But instead the scheme has led to anomalies, disputes, appeals and damaging publicity.
It can leave soldiers who have received horrific injuries aggrieved at their payouts.
Lance Corporal Martyn Compton of the Household Calvary was ambushed in Helmand Province, Afghanistan, suffering appalling injuries in a roadside bomb attack.
In a coma for three months with 70% burns, much of his fat and muscle was burned away and he was left with no ears.
"Beforehand the only burns I had seen were on Simon Weston from the Falklands who suffered 40% burns.
"So having 70% was an extreme amount. I had never heard of anyone that had been burned so severe," he told File On 4.
Reconstruction of his face has already begun, but he still faces more plastic surgery to rebuild his nose and ears.
"It's an amazing job, the surgeons are second to none and I can't thank them enough for the things they've done and kept me alive to start with," he said.
What was less impressive according to a comrade was the £98,000 compensation pay-out he received.
Many in the regiment were expecting he would get close to the £285,000 maximum, said a former colleague who has now left the army, Captain Alistair Galloway.
Captain Galloway has been trying to obtain a compensation deal for Lance Corporal Compton that reflects the severity of the soldier's injuries and suffering.
The government says critics focus too much on lump sum payments
"It was with absolute horror that we found out how much he'd been award initially, " he said.
"If a soldier gives his all to serve his country on front line he is expected to be looked after. If he hears that a fellow soldier wasn't paid as much for his injury, he might wonder what it's all for."
As File On 4 was due to go on the air, the Ministry of Defence, revealed that Lance Corporal Compton's compensation had been increased to £163,000.
The compensation scheme is based on a tariff - a scale which contains 15 levels of payment going from the most severe injuries down to the least.
Under this system, for most claimants, payments are made for only the three worst injuries.
Simon Carr, a barrister specialising in personal injury, explained how the basic system works, "What the government has introduced is that you receive 100% of the damages for the most serious, for the second injury you receive 30% of the full award and for your third injury you only receive 15%.
"The sum is far less than if your injuries were judged as a whole."
Compensation is calculated on a tariff system for scales of injuries
He added: "If this was assessed in a court your injuries would be looked at in their totality and awarded the appropriate amount."
But the government said the correct comparison is with the Criminal Injuries Compensation Scheme, which it claims the armed forces scheme closely parallels.
Last year the Government improved pay-outs for troops with very severe and multiple injuries but the number who will benefit from the change is limited.
Figures from the Ministry of Defence show that so far only about two dozen soldiers are likely to be better off.
However it appears a soldier who suffered a serious brain injury may not be among those who qualify for a higher pay-out under the new rule.
Lance Corporal Martin Edwards, 25, was hit in the head by shrapnel last year in Iraq while on his third tour of duty.
He has been in hospital ever since, while his wife cares for their two year old son at home, in between hospital visits.
Said his wife Sarah, " Everyone's really shocked when they get there and actually speak to him and really see how bad it is."
She added that he needs help with even the simplest tasks and may require 24 hour care for the rest of his life.
Given the devastating effect of his injury, Mrs Edwards was expecting him to get close to the maximum lump sum pay-out of £285,000, but he received just £114,000.
"When I think about it now and think about it future-wise for Martin I don't think that's going to cover anything really.
However the Ministry of Defence insisted the compensation scheme marks a real improvement for soldiers compared with the system as it existed up to 2005.
'Payment for life'
And Veterans Minister Derek Twigg suggested critics of the scheme have focused too much on the lump sums payments.
"They are only one half of the scheme," he said "what does tend to get forgotten about is this guaranteed income payment for life, tax free and index linked that's worth hundreds of thousands of pounds.
"Anybody who applies for and is successful in the Armed Forces Compensation Scheme gets the compensation up front while they're in service. That's the first time that's happened."
Mr Twigg added: "This is still a relatively new scheme and we keep it under review all the time and we learn from experience."
Hear the full story on BBC Radio 4: File On 4 Tuesday 11 March 2008 at 2000 GMT, repeated Sunday 16 March at 1700 GMT or online at the File on 4 website.