Families whose dead children were stripped of their organs by pathologists have reacted with fury to an NHS offer to pay them each £1,000 in compensation - five times less than the sum offered to families involved in the Alder Hey organs scandal.

More than 2,000 parents around the country are to bring a class action against the health service, following the systematic stripping of organs from their children for research purposes in hospitals across Britain.

The parents' group had hoped to settle the case out of court, but this failed when the families saw the total offer of £2 million and decided this was an unreasonably small amount compared with the Liverpool cases.

The parents involved in the Alder Hey scandal were offered a deal last year which is likely to be accepted by the end of next week, giving bereaved parents an average of £5,000 in damages. It follows the discovery in 1999 that Dutch pathologist Dick Van Velzen took thousands of organs out of children without their parents' knowledge, and stored them in his laboratory.

The Government ordered an inquiry, which has led to new regulations on the removal of organs, their storage and how relatives give their consent to research.

But the National Committee Relating to Organ Retention (Nacor), which is fighting the case for 2,065 other families whose children died at 27 hospitals, is dismayed at the cash offer. National co-ordinator Ruth Webster said: 'It is not money we are after, but a recognition of what we have been through.'

She said the group had made many non-financial recommendations, rejected by the NHS, such as producing a memorial rose bush that parents could plant at the graves of their children.

'Now that we're likely to be in the High Court this summer over this, it will end up costing the NHS hundreds of thousands of pounds more,' says Webster. Her baby daughter Ellen Elizabeth had 42 parts of her body removed after her death at Leeds General Infirmary, although her parents had given only limited consent for tissue removal. Their experience is the test case for the other parents.

A spokesman for the NHS Litigation Authority said: 'We would naturally have preferred to settle this through mediation rather than in court.

'The nationwide group is different in several respects to the Alder Hey group, although we applied identical principles to both. We felt the nationwide group had a significant proportion of claimants whose cases were not likely to succeed. It is a difficult and untested area of the law. We offered to them what we felt was a very reasonable figure in the circumstances, but they do not see it in the same way.'

< A HREF="mailto: jo.revill@observer.co.uk">jo.revill@observer.co.uk< / A >