The Justice Committee today launches an inquiry into
Pre-legislative scrutiny: draft personal injury discount rate
legislation.
TERMS OF REFERENCE
At the Government’s request, the Justice Committee has agreed to
undertake a pre-legislative scrutiny inquiry into the draft
clause Assumed rate of return on investment of damages published
on 7 September in Annex A to Command Paper 9500.
The Committee would be grateful for submissions addressing any or
all of the following questions concerning the draft legislation:
Objective of legislation
The Government's stated objective is to "reflect actual claimant
investment behaviour and ensure claimants are compensated in full
neither more or less Does the text of the draft legislation
achieve this objective, and could it be better achieved by other
legislative or non-legislative means?
Fairness of legislation
Will the proposed legislation result in a fairer framework for
(a) claimants, especially those for whom any risk would be
ill-advised (b) defendants and (c) wider society? Is the move
from “very low risk” to “low risk” appropriate, and are these
terms clear enough?
Should the way personal injury claimants generally choose to
invest lump sum damages influence how damages are calculated for
all such claimants?
Impact of legislation
How robust is the Government’s analysis of the proposal and of
its impact on (i) claimants (ii) insurance companies and (iii)
the NHS? (Impact
assessment). Who will be the main losers from the proposal
and how much will they lose by?
How likely is it that changing the methodology for calculating
the discount rate will result in a reduction of insurance
premiums? Is the Government right to assume that insurance
companies will pass on savings?
Process proposed by legislation
Who should be on the expert panel, and who should make the final
decision? Are there any circumstances where the Lord Chancellor
should not follow the advice of the independent expert panel?
Would it be better to review the rate more, or less, frequently
than proposed (every three years)?
Does the proposal allow different discount rates to be set for
different types of loss? What would be the advantages and
disadvantages of this approach?
The Committee would be grateful for submissions made by Friday 13
October.
Written submissions should be made via the webportal.
Please read the guidance on submitting written evidence available
here.
Committee Membership is as follows:
(Conservative, Bromley and
Chislehurst) (Chair); Mrs (Conservative, Saffron
Walden); (Labour, Brentford and
Isleworth); (Conservative, Cheltenham);
(Labour, Enfield,
Southgate); Mr (Labour, Delyn); (Conservative, Henley);
(Scottish National Party,
Paisley and Renfrewshire North) (Labour, North West Durham)
(Conservative, Banbury);
(Labour, Lewisham West and
Penge).
