What is happening? - The MDU
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What is happening?

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What is the discount rate?

The discount rate is the interest rate used by courts to calculate lump sum compensation payments to victims of clinical negligence incidents and other personal injury claims.

When was it changed?

The Lord Chancellor announced a change in the discount rate from 2.5%, which had been the level since 2001, to -0.75% with the change coming into effect from 20 March.

The impact is profound. For example, a claim that would have settled for £8.4 million on the previous discount rate would now settle for £17.5 million.

A government commitment to help

The Lord Chancellor's statement included the following commitment:

The Department of Health will also work closely with general practitioners (GPs) and medical defence organisations to ensure that appropriate funding is available to meet additional costs to GPs, recognising the crucial role they play in the delivery of NHS care.

This should mean there is no need to increase subscriptions. We have been in regular discussion with government departments since December 2016, but no solution has been announced for GPs or MDOs yet. 

With the general election underway, no announcement is possible until after the election and may not be forthcoming for months.

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