Section 1 - Assumed return on investment
9.Section 1 inserts a new section B1 into the 1996 Act. Subsection (1) of inserted section B1 provides that a court must take into account the rate of return set by the official rate-assessor (“the rate assessor”) in deciding the return the recipient of an award of damages is expected to receive from investing damages for future pecuniary loss. The choice of rate of return affects the factor or multiplier that a court applies when calculating damages for future pecuniary loss. Section B1 replaces section 1 of the 1996 Act (which is repealed by section 1(2) of the Act) under which the court is currently required to take account of a rate of return prescribed by the Scottish Ministers. As with the existing duty under section 1 of the 1996 Act, the duty under section B1(1) is subject to any rules of court made for the purposes of the section. No such rules of court have, to date, been made for the purposes of section 1 of the 1996 Act and none are presently proposed to be made for the new section B1. Section B1(2)(b) also preserves the ability of courts to take into account a different rate if shown to be more appropriate in the circumstances of the case (restating section 1(2) of the 1996 Act).
10.Subsection (3) of the inserted section B1 introduces Schedule B1 which is inserted into the 1996 Act by section 2 of the Act (see paragraph 12 below).
11.Subsection (4) of the inserted section B1 provides that the rate-assessor is the Government Actuary and in the event that the office of Government Actuary is vacant, the rate-assessor will be the Deputy Government Actuary. The Government Actuary is the head of the Government Actuary’s Department, a non-ministerial department in the United Kingdom Government. The Scottish Ministers will have the power to appoint a different rate-assessor by regulations (subject to the affirmative procedure) under subsection (4)(b) as well as somebody to deputise for that person (subsection (5)). The appointment is subject to the agreement of the person to be appointed as the Scottish Ministers must, before making regulations under subsection (4)(b), obtain the agreement of the person to be appointed in those regulations (whether as the replacement for the Government Actuary, or the person who is to deputise for that replacement).
