Used as a method to calculate how much should be deducted from the compensation of an injured person, the discount rate is routinely used in cases when the injured party of a personal injury claim receives income from investing their cash award.
The rate’s current 2.5 per cent level has been in place since 2001. The original calculations were based at the then-current figure of index-linked government stock and the yields they generated.
According to the president of the Association of Personal Injury Lawyers Muiris Lyons, since that date ILGS yields have undergone a gradual decline. Mt Lyons also believes that, for the past three years, the average gross yield on ILGS has been significantly less than 1 per cent.
Mr Lyons stated that due to the a failure on the part of the previous Government to conduct reviews of the discount rate to keep up with changes in the UK economy, the injured have faced erosion of their personal injury compensation as a result.
Mr Lyons added that the APIL hopes that when the Lord Chancellor reviews the situation, he will be quick to process and redress the current imbalance in an effort to reduce any further impact this will have on injured people in the future.
A non-profit campaign designation, the APIL has been campaigning for rights for the injured for two decadeshas been fighting for the rights of injured people for 20 years. Consisting of 4,700 member lawyers, which are mostly comprised of legal executives, barristers, and solicitors, have professed dedication to enhancing and protecting access to justice, changing relevant laws, and campaigning for an improvement to services provided to the injured.