UK government opens Ogden discount rate consultation

The UK government has opened the consultation over the future setting of the Ogden personal injury discount rate.

On February 27, the UK government shocked markets by cutting the Ogden discount rate to -0.75 percent from 2.5 percent. The so-called Ogden tables are used to calculate compensation awards for serious personal injuries. The discount rate adjusts personal injury damages awards to take into account the return expected when a compensation lump sum is invested and had been unchanged since 2001.

The consultation considers possibilities for how, when and by whom the discount rate should be set, but does not make specific proposals.

The core issues examined in the consultation paper are the principles which should guide how the rate is set, how often the rate should be set and who should set the discount rate.

The paper also considers whether sufficient use is being made of periodical payment orders.

The consultation is aimed at people and organisations with an interest in personal injury claims and damages in the UK and closes on May 11, 2017.