The Archdiocese of New Orleans has agreed to a proposed $230 million (£183 million) settlement with survivors of clergy sexual abuse, marking a major development in resolving one of the longest-running Catholic Church bankruptcy cases in the United States.

The deal, announced on Monday by lawyers representing survivors, follows years of legal negotiations since the archdiocese filed for bankruptcy in May 2020. A previous offer of $179.2 million (£142 million) was criticised by survivor advocates as insufficient.

“We knew this was a bad deal, and we knew we could do better; and we have,” said a group of 10 attorneys representing the survivors. They added: “The ‘power of no’ forced the archdiocese to come up with significantly more money.”

Survivors now have until late October to vote on whether to accept the revised settlement. If two-thirds approve the plan, compensation could begin to be paid out by next year.

“This is a significant step forward for the benefit of all claimant survivors,” the archdiocese said in a statement.

Archbishop Gregory M Aymond added: “I remain committed to bringing this bankruptcy to a conclusion that benefits the survivors of abuse,” and reaffirmed support for institutional reforms.

Reforms include an external review of the archdiocese’s child protection policies, the creation of a public archive at a secular university, and open forums for survivors to share their experiences with Church leadership.