There has been a further delay to the much-anticipated and important decision on the discount rate to be applied to compensation. And this comes almost two years after conclusion of the consultation on the question of whether the current rate of 2.5% should be modified.
This issue is of course of extreme importance to anyone involved in injury litigation. The legal professions are somewhat divided as to whether the rate should be increased or decreased, along (usually) respectively defendant and claimant lines.
Chris Grayling, the Justice Secretary (as he is more commonly known rather than Lord Chancellor) has now announced that he wishes to appoint panel of three financial investment experts to analyse all the responses to a consultation on the discount rate that closed as long ago as October 2012. It has been widely reported that the government’s initial response to its consultation was that successful claimants were prepared to invest in higher-risk investments than currently assumed. However, further research published in August 2013 the diametric opposite! The tender process for the appointment of these experts has yet to be completed.
The further delay prompted an understandably outraged response from the Association of Personal Injury Lawyers (APIL), who with some justification accuse the Government of ‘dragging its heels’ on the issue of a discount rate that has been set at the same level for 13 years. In the Ministry of Justice’s somewhat testy reply Mr Grayling said he saw ‘no reason’ to publish a timetable setting out how long the decision will take. (Perhaps he sees little reason to attempt to garner favour with lawyers, recognising bridges and boats may have been well-burned?)
It is unclear when anything approaching a final decision will be reached. Clearly it is unlikely to be in the lifetime of the current Government. The only seemingly sure advice, is for anyone interested not to hold their breath!