Reagan OKs Payments to Iran Jet Victims’ Kin : President Feels Compensation Is ‘Right Thing to Do,’ Fitzwater Says; Monetary Figure Left Open

President Reagan has decided to offer cash payments in compensation to the families of the 290 people killed when the U.S. Navy shot down an Iranian passenger jet July 3, his spokesman announced Monday.

White House spokesman Marlin Fitzwater said Reagan decided to offer the compensation because “he simply decided it was the right thing to do . . . (as) a humanitarian effort to ease the hardship of the families.”

“We are a compassionate people,” Reagan told reporters before the announcement. “We all have compassion for the families of those unfortunate people.”

Still Working Out Details

He said the details of the plan have not yet been worked out but stressed that payments would be made only to the relatives of the people killed in the incident, which occurred when the U.S. cruiser Vincennes fired two missiles at the jet in the belief that it was a hostile military aircraft.

“I want to make it plain that there will be no compensation for the government of Iran,” Reagan said.

Fitzwater and other officials said the Administration has set no dollar figure for the payments to the families. But a senior State Department official said the United States “would look at all the relevant precedents,” which could lead to millions of dollars in total payments to Iranian families.

The official also said that working out the amounts and methods of payment “is going to take a fairly substantial period of time” and noted that simpler cases of compensation have often required years before any payments were made.

Reaction in Congress, which must approve any compensation plan, was mixed. House Speaker Jim Wright (D-Tex.) said: “If the President is satisfied (with the idea), I would imagine the Congress would be satisfied.” He said a vote to approve the plan could be scheduled soon.

But Wright’s own Democratic Whip, California Rep. Tony Coelho (D-Merced), condemned the White House proposal as “premature.”

“I’m not inclined to provide payments to Iranians,” he said. “I want to know who is at fault and everything about it. . . . Maybe we have another secret Iran-Contra deal working. I don’t understand why they’re trying to move it along.”

Sen. John McCain (R-Ariz.) said he believes compensation should be delayed until Iran agrees to arrange the release of nine American hostages held by pro-Iranian terrorists in Lebanon.

“Clearly, the majority of the American people are not in favor of us taking this action,” McCain said.

An ABC News-Washington Post poll last week found that 61% of those surveyed opposed the idea of paying compensation.

Reagan, asked about those polls by a reporter, replied: “I think they have tied that to our feelings about the government (of Iran). . . . I don’t ever feel compassion sets a bad precedent.”

No Admission of Guilt

White House spokesman Fitzwater said the decision to offer compensation does not imply any admission of wrongdoing or guilt in the airliner incident. He said Reagan still believes “that the actions of the USS Vincennes on July 3 . . . were justifiable, defensive actions.”

He emphasized that the compensation was being offered ex gratia-- a legal term meaning “out of kindness.”

“This offer of ex gratia compensation is consistent with international practice and is a humanitarian effort to ease the hardship of the families,” Fitzwater said. “It is offered on a voluntary basis, not on the basis of any legal liability. . . .”

Several officials said the Administration hopes that the relatively quick offer of compensation will improve the U.S. image in Iran and in the Muslim world. They noted that the passengers killed on the plane also included citizens of India, Italy, Kuwait, Pakistan, the United Arab Emirates and Yugoslavia, all countries with which the United States has friendly relations.

Amount at U.S. Discretion

A senior State Department official, who briefed reporters on the plan on the condition that he not be identified by name, said the amount of compensation that will be offered “is totally discretionary.” But he added, “Obviously, a state interested in doing the right thing . . . would look at all the relevant precedents.”

In similar cases of accidental military attacks on innocent targets, he said, the customary procedure--at least in the case of friendly countries--is for the families to file statements outlining the victims’ earnings and the number of dependents they supported, so that the country offering compensation can adjust its payments accordingly.

Despite the largely hostile relations between the United States and Iran, the official said it remains possible that a procedure could be set up to process such applications. “We may talk to Iranian officials about this matter,” he said.

Could Pay Flat Sum

Otherwise, he said, the United States could simply pay a flat amount to the next of kin of each victim.

The State Department official refused to suggest any specific range of possible compensation. But in the cases he cited as possible precedents, the payments ranged from $30,000 per victim--paid by Israel to Libya after the downing of a Libyan Airlines plane in 1973--to claims reportedly as high as $1 million per victim in the case of the Iraqi air force attack on the U.S. guided missile frigate Stark in 1987.

Fitzwater said the Administration “will take every action possible through international organizations and third parties to ensure that this compensation goes directly to the families of the victims involved and not the government.”

He said any payments would be made through a third party, possibly the International Committee of the Red Cross.

The Administration has already decided not to offer any compensation to Iran Air for the loss of its Airbus A-300 passenger jet because the airline is government-owned, officials said.