MDU says discount rate law must change
The Medical Defence Union says the law governing the discount rate* is not fit for purpose and the new Government must change it. The recent discount rate drop of 3.25% substantially increased the cost of clinical negligence claims overnight and had a massive impact on the cost of public services like the NHS.
Responding to the Ministry of Justice’s consultation, the personal injury discount rate: how should it be set in future, Dr Christine Tomkins, MDU chief executive said:
“The Lord Chancellor’s decision to lower the discount rate has added billions of pounds to the cost of clinical negligence and other personal injury claims overnight. For example, a claim that we would have paid on behalf of a GP for £8.4 million, is now likely to settle for £17.5 million.
“The law must change to require whoever makes the decision to take into account the effect on public services like the NHS and on every citizen. There should also be an independent panel of experts to advise the decision maker, who should not set the rate in isolation. The financial and economic repercussions are profound and need to be fully understood as they should inform any decision about the discount rate.
“The benefit to the number of people who receive compensation awards must be balanced against the wider public interest, such as the impact on the NHS. The Treasury will need to find an additional £5.9 billion for the first three years of additional NHS costs alone.
“We have responded to the consultation on behalf of our members, pointing out what we think are the flaws in the current decision. In the meantime, GPs need immediate assistance to help them with the increased cost of indemnity as a result of the rate drop. It was already a serious concern and the Government committed to support GPs with the massively increased costs this decision has caused.”
