How much do compensation claims cost the UK economy

UK economy
UK economy

Accidents and injuries occur across the UK every day, and some of these can have a serious impact on the lifestyle of the individual involved. Suffering from an accident or injury can result in prolonged periods out of work, and victims can easily suffer a loss of earnings as result. Although statutory sick pay is available for all tax-paying workers, this is often not enough, especially if the victim has a family to support. In these circumstances it is possible to make a compensation claim and receive a financial payout.

UK economy

UK economy

Contacting a prestigious medical negligence solicitor is quick, easy and free and many firms work on a ‘no win no fee’ basis, meaning victims often have little to lose. As a result, many individuals will seek compensation payments every day, which has an inevitable impact upon our economy.

Compensation claims are made for a variety of injuries and accidents and in the last couple of years attention has been drawn to the impact this has upon the tourist attraction industry in the UK. A 2010 study found that thousands of pounds are paid out each year to visitors who injure themselves during days out at some of the country’s top tourist attractions. These include a woman who fell into a moat at Carlisle Castle who received £15,000 plus £37,250 to cover her legal costs. The Victoria and Albert Museum was also an accident-spot, as a woman received £23,651 plus £29,863 legal costs when she was injured in a revolving door at the museum. Figures such as these cost the taxpayer, and the 2010 survey estimated that tourist attractions were faced with a bill of £2,149,345 in the last five years, due to compensation payouts.

Accidents at work are also a financial burden to the economy. Slips, trips and falls make up the majority of workplace compensation claims and although many of these will be minor, some can result in long-lasting health complications and disability. A 2010/11 report estimated the total cost of workplace injuries to Great Britain to be around £13.4 billion. It is not only injuries at work which are causing problems for our economy, but illnesses too. Working in cramped office or factory conditions often means that illnesses can spread quickly. Of the total compensation bill in 2010/11 workplace illness cost an estimated £8.2 billion.

Although these figures seem dramatic, the cost is not all bourne by the government. Indeed, of the £13.4 billion in previous years, just over half of the cost fell on individuals, whilst the remainder was shared between employers and the government. The costs have also fallen too, as the during the years between 2006/07 and 2010/11 the total cost of workplace accidents and illness fell by roughly £3 billion.

Despite the cost to the economy of compensation payments, these are usually vital to the victims and enable them to lead a life of as best quality as possible.

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