The purpose of a compensation claim is to put the claimant in
the same position as he would have been if he had not sustained the
accident. Those representing compensators must ensure that the
tools available allow us to achieve this end, are valid.
There has been recent publicity about life expectancies in
Scotland. It transpires that in parts of Glasgow when measured at
birth the life expectancy of a male is only 64 years. This
depressing statistic means that a man from there is unlikely to
live to the present retirement age of 65.
This led us to consider whether our reliance on the Ogden Tables
for Multipliers to determine the extent of future losses in
relation to earnings, services, care, pension etc is justified. The
Ogden Tables proceed on the 2002 based National Population
Projections prepared by the Office for National Statistics. It
transpires that these projections relate to population studies in
England and Wales only. Projections are produced for Scotland (and
also for the whole of the UK) but the Ogden Working party have not
chosen to use either. The consequence is that when we use Ogden
Tables without adjustment we are applying a multiplier which is not
based on Scottish data.
is clear that for much of the Scottish population life
expectancies are reduced as compared with England. Because the raw
data is available for Scotland it is possible to apply the
actuarial formulae necessary to reach Ogden style multipliers for
Scotland. Simpson & Marwick, assisted by a firm of actuaries,
have now undertaken this task. The resultant tables are directly
comparable to Ogden save that they are based on the Scottish data.
We attach a set for your information and use. They are based on a
2.5% discount rate. The resulting multipliers for Scotland are less
than those in England by the following amounts.
Pecuniary Loss for Life +/- 4%
Loss of Earnings +/- 2%
Pension +/- 8%
It would be wrong to ignore the adjustments in the Ogden
Explanatory Notes. They say that for certain regions including
Scotland multipliers can be adjusted by deducting certain factors.
Our own figures seem to disclose that this is rather a crude and
arbitrary approach.
The Courts have not seen our tables yet, principally because we
have found quite a number of Scottish Solicitors regard them as
uncontroversial. We commend them to you.
Douglas Russell