Secretary of State for Justice (): This morning, I notified
the London Stock Exchange group that I would today lay a
Statutory Instrument to change the discount rate applicable to
personal injury lump sum compensation payments in England and
Wales to 0.5%. The new rate will come into force
on 11 January 2025, in line with the statutory timelines set out
in the Damages Act 1996, as amended by the Civil Liability Act
2018.
As Lord Chancellor, it is my statutory duty under the Damages Act
to periodically determine the discount rate which courts must
consider when awarding compensation for future financial losses
in the form of a lump sum payments in personal injury cases. This
rate is commonly known as the Personal Injury Discount Rate.
On 15 July 2024, I met the requirement to review this rate at
least every five years when I commenced a review and consulted
both HM Treasury and an independent Expert Panel for their
advice. I have now received their advice, for which I am very
grateful, and considered it alongside the responses to two recent
Calls for Evidence and further advice, evidence and analysis
which has been made available to me. It is on the basis of this
evidence, and having followed the review framework set out in the
Damages Act, that I have determined that a single rate of 0.5% is
the appropriate determination for me to make in this review.
A full statement of reasons, explaining how I have decided upon
this rate, will be placed in the Libraries of both Houses. It
will also be published on gov.uk, alongside the full advisory
report that was provided to me by the Expert Panel.
