PEOPLE who have suffered traumatic personal injuries should have their long-term compensation determined in a fairer and more transparent way, a cross-party group MSPs has said.
Holyrood’s economy committee said personal injury law should be reformed so that the UK Government actuary, not Scottish ministers, decided a key part of the calculation.
The committee was reporting on the principles of the SNP’s Damages (Investment Returns and Periodical Payments) (Scotland) Bill.
The Bill would see a change to the “personal injury discount rate”, which is used to calculate awards for future financial losses, such as ongoing care costs or lost earnings.
This adjusts the amount of compensation paid to a victim to reflect the fact that they can invest the money to generate a return.
It has the biggest impact on those who have suffered the most catastrophic injuries, and on those who pay compensation, such as insurance companies and the NHS.
At present, the rate is set separately for Scotland by the Scottish Ministers, for England and Wales by the Lord Chancellor and for Northern Ireland by the (Department of Justice) Northern Ireland Administration.
The committee found victims of personal injury already take on a number of risks in the process of achieving compensation for their personal injury, such as ensuring their award fits their life expectancy and dealing with inflation costs.
It said they should not have to carry undue risk, and the process must be improved with greater transparency.
Committee convener Gordon Lindhurst said: “Although the number of personal injury cases where the discount rate applies is small, the importance of the process to the individuals and families concerned is considerable.
“The Committee welcomes the introduction of this legislation and are content it will in principle achieve fairness and transparency across a range of cases and for both sides.
“We heard compelling evidence for payments which allow those that have suffered a personal injury to receive lifelong compensation instalments.”
The Committee also said the Bill offered a standardised approach to work in the interests of fairness, and would strike a balance between pursuer and defender interests.
MSPs also said they wanted more detail from ministers on analysing the 30-year assumed investment period, and said the discount rate should be reviewed every five years, not three.
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