Julian Chamberlayne comments in an article in the New Law Journal regarding the Ministry of Justice’s proposals for sweeping reforms to the discount rate in its Civil Liability Bill.
On 20 March, the Justice Secretary David Gauke unveiled the new Bill, which would “cut motorists’ insurance premiums by about £35 per year (by saving insurers about £1bn) and make savings for the NHS”.
Julian, who has written extensively on the subject of the proposed changes to the personal injury discount rate, said this about these proposals:
“We are still in the dark on the question of what proportion of claimants does the government consider it acceptable to go under compensated as a result of the new ‘low risk’ investment approach.
“All we are told is that they accept the median approach would be too much under compensation.
But is it okay for 10%, 20% or even 30% to have their compensation run out early and fall back on whatever help they can get from the State?”
The discount rate reforms have gone ahead despite a report by the Justice Committee that included criticism of the Government’s impact assessment and said:
“We do not think there is sufficient evidence for the Government conclusion that its proposed legislation is a proportionate means of achieving a legitimate aim, so as to justify possible disadvantages to those with protected characteristics. Indeed, without adequate evidence about the potential characteristics of claimants, or the cost to claimants, it is hard to see how the Government can draw any sound conclusion about proportionality.”
To read the full article in the New Law Journal, please click here.
To read more about the discount rate, see Julian’s article, Full compensation & the discount rate: revisited.
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