Major change to the discount rate announced by the UK Government
1 March 2017
In a significant development, on 27 February 2017 the Lord Chancellor Liz Truss announced a change in the discount rate, from 2.5% to -.75%. The Scottish Government has produced two consultation papers in the last five years considering the question of alterations to the discount rate in Scotland, which is currently set at 2.5%. The current position of the Scottish Government is that they are “considering the responses” to their second consultation paper.
Section 1 of the Damages Act 1996 gives the Scottish Ministers the power to set the discount rate to be applied in Scotland. It remains to be seen whether the Scottish Ministers will follow the approach taken by the Lord Chancellor. Should they opt to do so, the the cost of awards for future losses in medical negligence cases in Scotland will rise very significantly.
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