 The next item of business is stage 3 proceedings on the damages investment returns and periodical payment Scotland bill. In dealing with the amendments, members should have. The bill is amended at stage 2, that is SP bill 35A, the marshaled list and the groupings of amendments. The division bill will sound and proceedings will be suspended for five minutes for the first division of the afternoon. The period of voting for the first division will be 30 seconds. Thereafter, I will allow a voting period of one minute for the first division after a debate. Members who wish to speak in the debate in any group of amendments should press the request-to-speak buttons as soon as possible after I call the group. Members should now refer to the marshaled list of amendments, and I call in group 1, periodical payments pursuers wishes, amendment 1 in the name of Jackie Baillie, in a group of its own, and I would ask Jackie Baillie to move on to speak to amendment 1, Ms Baillie, please. Thank you very much, Presiding Officer. I am pleased to speak to amendment 1 in the group, and certainly in group 1 of the damages investment returns and periodical payments Scotland bill. That is indeed a mouthful. However, amendment 1 reflects an area that was considered by the committee during the scrutiny of the bill and on which it made a recommendation for change to the Scottish Government. I brought forward an amendment at stage 2, which I was asked to withdraw by the minister to allow for further discussion. That discussion has resulted in the amendment before the chamber today. In essence, amendment 1 will require the court to have special regard not just to a pursuer's needs, but also to their preferences. For many pursuers, amendment 1 will have been a lengthy process trying to obtain recompense for personal injury, which may well have been severe and catastrophic. It is essential in my view that their voice is heard throughout the process. amendment 1 is designed to ensure that at the very final stage of the process, a pursuer's views will have been listened to and given full consideration by the judge. Their preferences to whether to have a lump sum or, indeed, a periodic payment must be a principal factor at the forefront of the court's mind. The language of the amendment is careful to avoid creating a presumption, as it does not give the pursuer the right of veto. However, I would be very surprised if it is not a key factor in a judge's decision. I would certainly expect that the requirement placed on the court to treat the pursuer's preference, as well as their needs, as a principal factor, will have a real impact on the court's decision-making process, in every case. I am grateful to the minister for her officials for working with me to give effect to the committee's recommendation, so I move amendment 1 in my name. I am grateful to Jackie Baillie for setting out clearly the background to the amendment. Obviously, I have not sat through the evidence that the committee has sat through, but the Justice Committee did deal with the civil litigation bill earlier in the Parliament, which touched on many of the same issues. One of the things that we wrestled with in terms of often very significant payments was that individuals could potentially come under pressure from members of their family or, indeed, wider friend group to opt for a large lump sum, which then may not necessarily be invested in their best interests. There was also the issue that with a lump sum, as opposed to a periodic payment, the pursuer would also be liable to a legal fee to their solicitors over and above the normal cost. It is very helpful that Jackie Baillie has set out the rationale for the approach, and I think that nobody would wish to see the pursuer's interests ridden roughshod over, I suppose, for myself and perhaps other Justice Committee colleagues who wrestled with it under a different piece of legislation that would be helpful, either for Jackie Baillie or, indeed, the minister, to clarify how those safeguards can play in to avoid issues past them that are clearly not in the interests of the individual concern. Yes, I would be happy to support the amendment that Jackie Baillie has proposed. On the committee, many of us did feel that a move towards more periodical payment orders would be a good idea. Looking in from the outside, that often is a good answer, because it takes away the risk of having to decide about investments and many of those things that many people are not comfortable with. However, on the other hand, it was made that, to some people, it did not trust the defendant to keep on paying the money, and some of them just wanted to break the relationship with the defender and to have a stand-alone amount. It is fair to say that the courts might have considered all of that anyway, but it does no harm to re-emphasise that the courts should take into account what the pursuer is looking for. It was very helpful to meet Jackie Baillie to discuss the amendments that she lodged at stage 2. The stage 2 amendment was attended to allow the pursuer's voice to be heard in respect of their preference for either a periodical payment or for a lump sum. Jackie Baillie and other members have spoken about trying to address that sense of powerlessness that people who have suffered a catastrophic injury might well feel should an order for periodical payments be imposed. That is a very difficult thing to capture, but it does not mean that it cannot be done. We had a very productive discussion since stage 2, and we have come away with a better understanding of one another's position on the issue. I always indicated that I had some sympathy with the underlying principle behind the stage 2 amendment, but my concerns lay in the way that the stage 2 amendment was being given effect, which I believe went too far and also had the potential to create some legal difficulties. It is important for balance to be struck in highlighting the pursuer's preferences as a key consideration, but without treating the pursuer's position as paramount, without creating an overly rigid presumption or giving the pursuer a unilateral veto, or allowing the defender to be put at a substantial disadvantage compared to the pursuer and putting at risk, therefore, the defender's right to a fair hearing. I am very pleased to say that I do not have any difficulties along those lines with amendment 1 being debated today. Amendment 1 refers not just to a pursuer's needs, but also to the pursuer's preferences. I think that that addresses the very human aspect of a pursuer's position about which a number of members have spoken, but amendment 1 goes beyond ensuring simply that the court takes into account the views of the pursuer as it could do anyway. The amendment expressly highlights the needs and preferences of the pursuer as something for the court to have special regard to. From the particular language used, it may be expected that the things highlighted will weigh heavily as key considerations at the forefront of the court's mind when it is deciding between the options for the form of the award. Indeed, all things being equal, it may be expected that the pursuer's needs and preferences will be given priority by the court. In summary, I believe that amendment 1 strikes the appropriate balance, while ensuring that the pursuer's preferences as well as needs are specifically recognised in the bill and, accordingly, I am happy to support amendment 1. Thank you, Jackie Baillie, to wind up and press or withdraw your amendment. Briefly, Presiding Officer, I welcome the contribution from the minister and, indeed, other members across the chamber. It was not just I that raised this at the stage 1 debate. My colleague Angela Constance did likewise, and this is something that the committee considered to be important. John Mason was right to reference the use of periodic payment orders as a mechanism to reduce risk and ensure that awards are made over the lifetime of a pursuer. The reality is that we will see a combination of lump sums and periodic payments in play, but, ultimately—let me reassure Liam McArthur in particular—we wanted, at the end of a very long, lengthy court process, for the pursuer's voice to be heard and to ensure that, ultimately, it was not just about their needs that were being met but that their preferences were taken into consideration. I am sure that the court would be alive to some of the external pressures that pursuers may face, but I would ask the chamber to support this amendment because, Presiding Officer, it is the right thing to do. Just simply say press or withdraw. Are you pressing your amendment? I am pressing it, Presiding Officer. The question is that amendment 1 be agreed to. Are we all agreed? We are agreed. Group 2, periodic payments, drafting amendments. I call amendment 2 in the name of the minister. Group with amendments 3, 4, 5, 6, 7 and 8. Minister, please remove amendment 2 and speak to the other amendments in the group. All of those amendments fall into the category of minor and tidying in nature. Amendments 2, 4 and 5 relate to an amendment moved by Stuart Stevenson and agreed to by the committee at stage 2 to place a requirement on the court to set out its reasons for being satisfied that the continuity of payments is reasonably secure. At the time, I reserved the possibility of bringing forward Government amendments to make any necessary technical changes at stage 3 so as to ensure that the wording of the provision added by Stuart Stevenson fully dovetails with the related provisions. Those amendments therefore make some minor adjustments to the text in order to do so, and I think that they speak for themselves. The substance of Stuart Stevenson's addition at stage 2 is not affected. Amendments 3, 6, 7 and 8 come about as a result of suggested change made by the Association of British Insurers. The ABI expressed the view that, in the new subsection 1A, in section 3 1C, the reference to a court not making an order for periodical payments unless it is satisfied that the continuity of payment under such an order would be reasonably secure should be changed to is reasonably secure. As well as making the wording chime more tightly with the introduction of the assumptions that follow in the new 2C1, the section would bring the drafting more in line with the equivalent provision that applies in England and Wales. Importantly, the conditional element of the matter is not lost altogether, as the new section 2C1 continues to refer as necessary to what would be the case. Whilst we are satisfied that no difference could arise in practice under the wording used, we are content to make the change. The same point arises elsewhere in section 3 and once in section 4, so similar changes are made for consistency in those places. I move amendment 2, in my name. Thank you. No other members indicated their wish to speak. Minister, do you wish to wind up? No, thank you. The question is that amendment 2 be agreed to. Are we all agreed? I call amendments 3, 4, 5, 6, 7 and 8. All of the ministers and all previous debated invite the minister to move amendments 3 to 8 on block. Does any member object to a single question that we put on amendments 3 to 8? Thank you. The question is that amendments 3 to 8 are agreed to. Are we all agreed? Thank you. Group 3, rate of return standard adjustments, I call amendment 9 in the name of minister and a group in its own minister to move and speak to amendment 9, please. I explained at stage 2 that the approach taken in the bill on how the discount rate should be calculated is based on a portfolio that meets the needs of the hypothetical investor as described in the bill. The asset classes and percentage holdings contained in the notional portfolio have been balanced in such a way as to support an approach in terms of investment choices which is capable of limiting volatility and uncertainty. The bill also includes two standard adjustments, which the rate assessor must adopt when arriving at the rate of return, and the amendment deals with the first of these. It is intended to take account of investment advice, management costs and taxation, and the adjustment is set out on the face of the bill with regulation making powers for Scottish ministers to change the adjustment if required. The Scottish Government accepts that there will be a need to take investment advice, and indeed one of the characteristics of the hypothetical investor is that they are properly advised. Prior to the introduction of the bill, Scottish ministers sought views from the Government's Actuary's department on the appropriate level for the adjustment for tax and passive investment management costs. Whilst GAD considered that the reasonable allowance for expenses and tax might fall into the range of 0.5 to 2 per cent, it was also of the view that an allowance at the lower end is likely to be more appropriate because it is reasonable to assume that pursuers will shop around for competitive fees, and it is reasonable to assume that pursuers will directly invest in passive funds and in the current economic environment income yields, particularly on bonds, are low, which eases the possible pressure of higher tax charges, and that there are further deductions included elsewhere in the discount rate. At stage 2, Jackie Baillie brought forward an amendment that sought to increase the standard adjustment for tax investment management costs from 0.5 per cent to 1.5 per cent. I pointed out that the composition of the portfolio and the level of adjustments that are set out in the bill are the result of analysis, actuarial advice and available evidence. The methodology and adjustments have been carefully calibrated with a view to ensuring, insofar as possible, the principle of 100 per cent compensation is adhered to, and they are a complete package of measures with a further adjustment ensuring that the possibility of undercompensation is at an acceptable level. I was also clear that, from the Government's point of view, that Jackie Baillie's proposed increase would tip the balance too far in favour of pursuers, too higher percentage for the deduction under consideration would increase significantly the chances of pursuers being overcompensated. That would go against the principle of achieving the right levels of compensation and pass an undue burden on to defenders, including public services such as the NHS. During stage 2, Jackie Baillie withdrew her amendment on the basis that we would have opportunity to discuss the issue further, and it was helpful to meet with Jackie Baillie and to exchange our views after stage 2. I was able to advise that we would be working with the Ministry of Justice to get early access to any relevant evidence on tax and investment management costs arising from their very recent call for evidence ahead of the review in England and Wales, and we have done that. With that information to hand, we sought further advice from the Government Actuary's department. I have now considered their advice, which points to a small uplift in the adjustment being required. Their advice is given in the context of the portfolio contained in the bill. Their view is that there have been small increases in the fees that would apply. Specifically, in GAD's view, there is a small increase in appropriate passive fund manager fees, reflecting evidence from the call and further consideration of the charges that might apply for the Scottish portfolio. Based on the evidence from the call, it would be appropriate to include a small allowance for charges for platform fees in order to access the funds and for also obtaining advice. My amendments will therefore increase the standard adjustment from 0.5 per cent to 0.75 per cent to allow for those increases. I am content that this is the appropriate change to make, based on this impartial and professional advice. Indeed, that not to make it would be to ignore that advice. That change will help to ensure that, as far as possible, pursuers are properly compensated through the application of the discount rate, arrived at through the application of the new methodology. The percentage in my amendment represents an important aspect of getting this right. I move amendment 9. Thank you very much. I call Dean Lockhart for all of our Jackie Baillie, Mr Lockhart. Thank you, Presiding Officer. Amendment 9, as we have heard in the name of the minister, would increase the standard adjustment to the discount rate for investment charges and taxation to 0.75 per cent from 0.5 per cent, as originally set out in the bill. The economy committee's stage 1 report on the bill considered this adjustment to the discount rate. After considering evidence from all sides of the argument, the committee concluded that, on balance, it was content with an adjustment rate being set at 0.5 per cent. At stage 2, the minister told the committee that a 0.5 per cent standard adjustment recognised that investors would shop around to get the best possible rate for investment charges and that the notional investment portfolio would largely comprise passive funds that would not require active management and would not incur significant investment charges. The minister also told the committee, as she set out in her opening, that she accepted the advice from the government actuary's department on the adjustment level being set around 0.5 per cent. Given that background, increasing the standard adjustment to 0.75 per cent runs the real risk of departing from the fundamental principle under Scott's law of fair compensation. While we understand the Government's approach of legislating in favour of overcompensation rather than risking undercompensation, we have to recognise that that comes at a cost. The cost associated with paying more than 100 per cent compensation will fall on public bodies in Scotland, such as the NHS and other public bodies that self-insure. John Mason. I thank the member very much for giving way. Would he accept that it is not possible to get to a position where everyone is correctly 100 per cent compensated, but it is inevitable that some will be undercompensated and some will be over? Dean Lockhart. That is a fair comment. You have to be somewhere in the spectrum, but based on the evidence that we heard at committee, the increase of the adjustment to 0.75 per cent takes us quite far down the spectrum of the risk of overcompensation. As I said earlier, the reality is that the cost of paying more than 100 per cent compensation will in real life fall on public bodies in Scotland. For the reasons that I have set out above, the Scottish Conservatives will not be in a position to support amendment 9 in the name of the minister. I call Jackie Baillie to fall by Leanne McArthur. Presiding Officer, I welcome the opportunities to speak in the debate on amendment 9 in the name of the minister. The committee took evidence at stage 1 about standard adjustments and, as the minister has referenced, I brought forward an amendment at stage 2 specifically about the amount that is allowed for the impact of taxation and the cost of investment advice. The Scottish Government's position, as we have heard, was to allow for 0.5 per cent, which was considered by some to be just too low and not reflect the actual cost of advice and taxation. The Association of Personal Injury Lawyers provided expert evidence from a range of independent financial advisers all experienced in this area that all suggested that 0.5 per cent was too low and the real costs were likely to be between 1.5 per cent and 2 per cent, based on their experience of dealing with personal injury cases. My amendment was duly cautious at setting the rate at 1.5 per cent. Indeed, if I might pray and aid the Government Actuaries Department, it published its own analysis of the personal injury discount rate and the minister rightly suggested that its advice for tax liability and fees for advice was likely to be anywhere in the range of 0.5 per cent to 2 per cent. The minister and the Scottish Government chose, obviously, to place the rate at the lowest end of the scale, but I might also point out that the Actuaries Department also said that it would be appropriate for the rate to be set higher. As the minister has referenced, there is a review south of the border by the Ministry of Justice and she has helpfully considered that in her further deliberations. Again, I welcome the very helpful discussion with the minister and her officials. They have reflected further and adjusted the rate upwards to 0.75 per cent. Now, it is not as much as I would have liked, it is not as much as the evidence suggests that we may require, but I recognise that it is a step in the right direction. I will therefore be supporting the amendment, but I would ask the minister to assure the chamber that she and her officials will keep that under review and change the rate in the light of experience to avoid any suggestion of undercompensation. I am conscious that I do not have the background on the bill that Dean Lockhart and Jackie Baillie do. Indeed, the minister reassured to some extent by what the minister had to say about her engagement with the Government's Actuario department. Clearly, there is a balance to be struck here. The committee itself came to the conclusion that there is not an exact science here. I am struck by the response that the minister gave to my colleague Alex Cole-Hamilton in a written answer to parliamentary question very recently. He said that the Scottish Government expects that the UK Government will continue to cover the costs arising from the change in the discount rate to the extent that the rate in Scotland is in line with the rate in England and Wales. The Scottish Government will continue to pass that funding on to the NHS in Scotland, which is helpful, but rests heavily on the fact that the rate in Scotland is in line with that in England and Wales. As I understand it, that might not be the case in this instance. Therefore, I wonder how that shortfall will be met, whether the minister has had discussions not just with the Actuario department but with health colleagues about the potential implications for any financial liability to the NHS and whether or not there will be a revised financial memorandum published. As I understand it, I do not think that there is one ahead of stage 3, which is rather unhelpful for those of us who are trying to get our heads around what the implications are of the change that the minister has proposed. Daniel Johnson Thank you very much, Deputy Presiding Officer. I would very much like to reflect the comments made by Jackie Baillie. That was a point of some debate and discussion at stage 1, and rightly so. What we are talking about here is the money that is made available to people in order to get their fares and order having been awarded compensation. While much of the talk is of what might be reasonable or what typically people might be able to obtain, we must also look at the people who fall outside the range of reasonable expectations. A very much in line with what John Mason was pointing out about is that some people might well be overcompensated and some people might be undercompensated. He is right, but what we need to do is ensure that we protect the most vulnerable, because those are undoubtedly vulnerable people that we are talking about. I note that the range of values that were arrived at by the Government Actuary were not 0.5 to 2 per cent, and indeed, while they might have said that the appropriate rate would be the lower range, not 0.75 per cent as well within that lower range. I, too, like Jackie Baillie, would like to hear from the minister how that rate will be kept under review and how, if it is found to be insufficient, it might be revised in the future. In the end, the increase is welcome, albeit that it might not grow as far as we might like on those benches. The minister is pleased to wind up. Thank you, Presiding Officer. There are a number of points that I would like to address in my summing up now. First, Dean Lockhart raised a point. When the new rate comes in in September, I expect to save defenders money. Defenders would, of course, include the NHS in that. The call for evidence by the MOJ on matters relating to investments was extremely timely in this case, and my amendment is based on that most recent evidence. Gadd analysed the evidence from that call for evidence by the MOJ with reference to the portfolio in the bill that we are discussing, and they revised their advice. It would not be appropriate then not to act on that advice that I had been given. I want the adjustment in the bill to reflect the most up-to-date evidence that is available, and that is what it does. Of course, the adjustments will be kept under review, and that is on the face of the bill, as well, just to reassure Daniel Johnson on that point. The question is, amendment 9, be agreed to. Are we all agreed? We are not agreed. There will be division, as this is the first division of the stage that the Parliament has suspended for five minutes. We will now proceed with the division on amendment 9. This is a 32nd division, so members should cast their votes now. The result of voting on amendment 9 is, yes, 84. No, there was no votes no, and abstention is 26. That amendment is therefore agreed. We now call on group 4, weight of return, drafting amendments. I call amendment 10 in the name of the minister, group with amendments 11, 12, 13 and 14. I am trying to say something, and I cannot even hear myself. Minister, to move amendment 10 and speak to all amendments in the group, please. All the amendments in this group relate to an amendment moved by Dean Lockhart at stage 2 and agreed by the committee. The amendment reworked the duty of the Scottish ministers in relation to the notional portfolio. The duty went from having regard to the need to ensure that the notional portfolio remains suitable for the hypothetical investor to including a review on suitability, incorporating a requirement to consult appropriate persons. At the time, I reserved the possibility of bringing forward Government amendments to make any necessary drafting changes at stage 3, not only to ensure that the provisions would work properly, given the possibility of an interim rate review, but also to ensure that the overall wording and structure of the provisions reach the desired result in the best and in the clearest way possible. Amendments 10, 11, 12 and 14 make some modest adjustments to the text in connection with the review of the portfolio. They align the wording of the text with the provisions cross reference to. They reflect the fact that the on-going assessment of the portfolio and the making of regulations, if necessary, are really just parts of a single process. They directly time the necessity of regulation making to the suitability of the portfolio for the notional investor, and they tidy the structure and the wording of the provisions and give a useful signpost for the reader to the description of the notional investor. However, the substance of what Dean Lockhart added at stage 2 is not affected by those amendments. They preserve the need to assess the notional portfolio ahead of each five-year cycle of review, along with a duty to consider whether regulations are necessary. Amendment 13 is different. Interim reviews by their very nature are likely to be needed where there are urgent or extraordinary circumstances, and Amendment 13 therefore excludes interim reviews from the scope of the provisions added by Dean Lockhart at stage 2. I move amendment 10 in my name. Thank you, minister. No other member has indicated the wish to speak. Do you wish to wind up? The question is amendment 10. Do we agree to or are we all agreed? I call amendment 11, 12, 13 and 14 on the name of the minister in all previous debate, and I invite the minister to move amendments 11 to 14 on block. Moved. Does any member object to a single question that we put on amendment 11 to 14? Thank you. If no member—the question is amendment 11 to 14 agreed, are we all agreed? That ends consideration of the amendments, and I will have a short pause before we move on to the debate. As members are aware, at this point in the proceedings, the Presiding Officer has required understanding orders to decide whether or not, in his view, any provision of the bill relates to a protected subject matter—whether it modifies the electoral system and franchise for Scottish parliamentary elections. In the case of this bill, in the Presiding Officer's view, no provision of the damages, investment returns and periodical payment to Scotland Bill relates to a protected subject matter. Therefore, the bill does not require a supermajority to be passed at stage 3. The next item of business is debate on motion 16394 in the name of Ash Denham on the damages, investment returns and periodical payment to Scotland Bill. May I ask those who wish to speak in the debate to press the request to speak buttons, and I call on Ash Denham to speak to and move the motion for seven minutes, please minister. I would like to start by thanking the members of the Economy, Energy and Fair Work Committee for their careful and helpful consideration of the bill. I have very much welcomed the committee's thorough scrutiny of the bill, and it is clear that some members of the committee have appreciated the importance of getting things right, but they have also appreciated that the process is not always straightforward. I would like to thank the committee clerks for all their hard work and those stakeholders who contributed views and opinions as part of the parliamentary scrutiny of the bill. The Scottish Government has had some very useful engagement with stakeholders. There have at times been differing, and I dare say opposing views on some aspects of the provisions in the bill, perhaps not surprisingly when there are pursuers on one side and defenders on the other, but, despite their differences, a commonly held view is that the current process for setting the discount rate is flawed and the law needs to be changed in some ways to make it better. The context of the bill is therefore widely held view, borne out of extensive consultation over the past seven years, that the law on how the discount rate is currently set needs to be changed. I would just like to briefly remind the chamber about some of the key provisions in the bill and what they are intended to achieve. Part 1 of the bill reforms the law on the setting of the personal injury discount rate. The provisions are intended to ensure that, as far as practical, the method and process for setting the discount rate is clear, certain, fair, regular, transparent and credible. The fact that there has been seven years of consultation on this matter serves only to demonstrate that this is not an easy subject and there are no easy answers. The bill provides that the job of reviewing and assessing the rate will, in the first instance, fall to the Government actuary. On the discount rate, we have adopted an approach that regards the termination of the rate as an actuarial exercise that should be free from political interference. In any system for setting a personal injury discount rate, there must be an element of political judgment. The approach taken in the bill is to separate out the actuarial exercise from the political judgments, with the latter being set out transparently in the legislation. The scrutiny process for this bill has provided the necessary parliamentary accountability to ensure that we have a framework that is fit for purpose. It will be for the Government actuary to apply the methodology to arrive at the rate and we are of the view that this professionalism and expertise makes him the best fit for that role. The bill also establishes a timeline for the review of the discount rate. That is important because we are aware of the impact of a change not being made for over 15 years and that was considerable. When the bill was introduced, it provided for reviews every three years, but we listened to stakeholders and the committee on that point and amended the bill at stage two to increase the frequency from every three years to every five years on the basis that the committee considered that that would represent a good balance between flexibility and certainty. One of the most complex aspects of the bill is the methodology for calculating the discount rate, and the bill provides a framework for doing that. It is important to remember that, at the heart of the bill, those who have suffered a significant, if not a catastrophic and life-changing injury and their right to fair and full compensation. An award for damages is designed to compensate a wrongly injured person for the losses and harm caused by injury, no more and no less—easy to say but hard to do. The most likely cause of someone's damages not being enough or being too much stands separately from the calculations around the discount rate, and that is the assessment of their life expectancy. There are no absolutes. We can only improve or diminish the chances of over or under compensation happening. When I talk about a framework, that terminology is important. The composition of the portfolio, the standard adjustments and the assumption about the duration of the award are fully integrated and operate together to produce the discount rate. There is a package. For example, our riskier portfolio would attract a different adjustment for tax and investment management costs. Finally, the courts in Scotland will now have the ability to impose an order for periodical payments, as provided for in part 2 of the bill. It is worth noting that the intention behind the provisions in the bill, which requires a court to consider whether an award should take the form of an order for periodical payments, and to make such an order without the consent of the parties, is effectively to address the current scenario that has sometimes been described as the defender holding the trump card, because at the moment they can effectively overrule the pursuer by simply not agreeing to their preferred method of award. I am sure that we would all agree that there are good reasons for remedying that position. Where there is disagreement, it is considered that the best independent arbiter is the court and not effectively one or other of the parties involved. I am convinced that the provisions in this bill will result in methods and processes that are clear, certain, fair, regular, transparent and credible. I move that the Parliament agrees that the damages, investment returns and periodical payments of Scotland's bill be passed. I thank my colleagues on the Economy, Energy and Fair Work Committee for their work on the bill, and I also thank the minister for her work on the bill, including her timely response to the committee's stage 1 report. I also thank the clerks and legislation team who have assisted myself and all members involved at all stages of the bill. Throughout our consideration of the bill, I think that there has been a genuine recognition by everyone for a number of principles. First, the importance of the proposed legislation adds clarity and transparency by providing a statutory framework for calculating the personal injury discount rate. Clarity and transparency is, of course, hugely important to a person who has undergone life-changing events. A number of colleagues during the stage 1 debate laid this out unambiguously when they described how a person's life may never be the same again following a life-changing incident, potentially unable to earn and reliant on care for the rest of their life. Although there may be few in number, cases involving the discount rate for future losses will benefit from the bill. Secondly, the principle of 100 per cent compensation and the overarching goal of working out a system that we would limit under or over compensation as much as possible. Recognising, of course, that there can be no exact science in this, as the minister has already said, but at the same time acknowledging the effects of not getting it right for both pursuer and defender. Defenders include, of course, not just insurers to whom we might have to pay higher premiums but also the public bodies that we fund as taxpayers such as the NHS, who, as we heard during stage 1, could be at risk in both over and under compensation scenarios. Broadly speaking, this bill has tried to hit the right balance and hopefully has been largely successful in doing so. Some of the concerns that the committee had at stage 1 have been ironed out during subsequent stages of the bill. During stage 1, and in my role as convener of the committee, I raised the concerns of members in our report about gaming, a term relating to cases where a settlement might be delayed if one or more party anticipates a more favourable rate coming into force. It was therefore welcome that the minister changed the review period of the discount rate to five years. Keeping up to date with market changes is essential in ensuring that this legislation stays relevant. Unlike the current process for setting the discount rate, which in 2017 held a review that was the first in 15 years, a number of members across the chamber also raised the importance of the pursuer's views in determining periodical payment orders or lump sum awards. PPO's can be preferable for some people because they give certainty of a regular income over time. Others prefer the lump sum in order to pay for accommodation from the outset, for example. Amendment 1 sets a slightly different tone from amendments at stage 2, asking that the court has special regard to the pursuer's needs and preferences, rather than a presumption in favour of the pursuer's preferences. As the minister herself said in responding to the committee at stage 1, it is important not to undermine or limit the court's ability to make the best decision given all the facts and circumstances of a particular case. The amendment should not prevent the court from making that decision, but I welcome some further comment from the minister on how she envisages a court approaching the matter. Concerns remain about amendment 9, as outlined by my colleague Dean Lockhart. The goal of the bill is to stick to the 100 per cent compensation principle as far as possible. Witnesses at stage 1 told the committee that the award of damages is not an investment pot, it is not a reward, it is a sum of damages to look after somebody's needs for the rest of their life. There is a risk that this amendment takes us over the 100 per cent principle and could have significant knock-on effects for insurance premiums in public bodies. The committee was content with the half per cent standard adjustments as it appeared that the minister was at that stage at least. While that is only a small change on the face of it, in practical terms it could make a huge difference. The late change by the Government will need to be carefully reviewed as appropriate as we go forward and measures taken by the Scottish ministers by way of regulation were appropriate. With that, I conclude my comments on the bill. I thank the clerks and members of the Economy, Energy and Fair Work Committee for their excellent work on the bill. Indeed, speaking in this bill, I feel that it is an interloper given the substantial work and the very difficult subject matter that they have been dealing with. I also acknowledge and give my thanks to the many organisations and individuals who have participated in the drafting and consultation process. Undoubtedly, their work has meant that we have a stronger bill in front of us. Labour supports the bill and welcomes its aim of creating a fair, transparent and incredible personal injury discount rate and damages regime. The bill seeks ultimately to protect people who have suffered significantly and, in many cases, will undoubtedly be vulnerable and to provide them with greater clarity, transparency and security for those who have been injured through wrongful behaviour. Ultimately, it is about making sure that we have a damaged system in place that is fair and equitable. It is about creating a system that empowers those seeking compensation rather than taking away more of their control. As the minister very correctly set out in her opening remarks, there are no easy answers. The bill is a series of balances that have been struck and, through the consideration both at stages 1 and 2, I think that most of those balances have been struck. Well, but let me just address some of the amendments that have gone through. The bill undoubtedly represents progress and, as I have said, there is a debate about where those balances have been struck, which is why in amendment 1 we are very pleased to have seen progress. Amendment 1 will ensure that the court awarding damages will be required to have special regard to pursuers' needs and preferences, deciding whether to impose a periodical payment order. As we have already heard from speakers in this debate, there is a balance there to be struck between the preferences of the individual and the ability of the court to decide what is the best outcome, given all the facts in front of us. However, I think that amendment 1 strikes that balance, and I think that the bill is stronger for it. It is an important change that will provide greater security and protection and reassurance to those who are pursuing damages through the courts. I would also like to turn to amendment 9. Throughout the passage of the bill, Labour has put forward the arguments about how we can make it fairer for pursuers. While we welcome the areas where the Government has done likewise, we obviously have concerns about amendment 9 and feel that it could have gone further. When the bill was originally drafted, the Government underestimated the cost to the pursuer of inflation, taxation and investment. As a result, we are pleased that the Government has increased that level of standard adjustment from 0.5 to 0.7 of a percentage point to take into account the impact of taxation and the cost of investment advice and management. That is advice and support that people will need because we will undoubtedly face decisions that they have never had to make before, speaking to professionals that they will not regularly or normally have contact with. Therefore, it is important that they are provided that level of support. As I said, it is disappointing that the Government chose to set a rate at the lower end of the range of activities, and it is lower than many would have wanted. While we support amendment 9, I think that it is important that that is kept under review. I welcome the minister's remarks that she made in the debating of that amendment on that very point. In conclusion, this bill is an important step forward in providing security to those who have suffered what will very often be traumatic and indeed life-altering events. There is, of course, more that could have been done to provide greater protection to the most vulnerable people who find themselves seeking damage, but this is an important step forward. We would urge the Government, therefore, to keep those measures under review and be willing to revise and reform the provisions of the bill once enacted, not least with regard to the standard adjustments that I have already outlined. Labour supports this bill as it will help to protect vulnerable people, those who have been injured. While recognising its flaws, we welcome the passage of the legislation and the fact that it will create a fairer, more transparent, more credible regime regarding personal injury and damages awards. I welcome the opportunity to make a few brief remarks, a little like Daniel Johnson. I feel a bit of an interloper in this debate, but I, like others, pay tribute to the work of the economy committee and its clerks for all that they have done on what is a technical bill, but one that is hugely important, particularly to those who find themselves having to make a compensation claim often vulnerable, possibly at a low point in their life. We are absolutely right at stage one to observe that the number of people affected by personal injury cases, where the discount rate applies, may be small, but the means of calculating their compensation is of vast importance to them and their families, as well as to pursue and defend their interests, the NHS included, and the insurance industry. I think that that encapsulates what we are trying to wrestle with here. As I observed during the earlier proceedings, I have had some engagement with those issues through the work that the Justice Committee did on the Civil Litigation Act, and I think that very much at the forefront of our thoughts during that process were the points that were made by Gordon Lindhurst and Daniel Johnson about the importance of clarity and transparency. They are absolutely key. There is a need to try and avoid the risk of undercompensation or, indeed, overcompensation. Again, as the committee observed, that is not an exact science, it is a balance to be struck. I would make a couple of observations following on from the exchanges during the amendments earlier. I am very grateful to Jackie Baillie for setting out the background to her amendment. I realised that that would have been an iterative process. I am grateful to John Mason for his observations on that point. As I said during the Civil Litigation Bill scrutiny process, we were concerned at instances in which lump sums were being awarded and possibly then not necessarily being used in the best interests of the individual concerned. There was also the risk of some of that lump sum being assigned to legal representatives as well. Again, the compensation needed to manage the cost over a lifetime was very much at the heart of what we were seeking to achieve. The balance has been struck through the amendment that Jackie Baillie has seen passed to ensure that the pursuers need interests and wishes are properly respected and reflected in any judgment that the court comes to as a result of that process. The other concern is in relation to amendment 9. Again, I will not necessarily rehearse all that, but I was slightly concerned that, in response to the parliamentary question from Alex Cole-Hamilton recently, the minister set out, and I think that he bears repeating, that the Scottish Government expects that the UK Government will continue to cover the costs arising from the change in the discount rate to the extent that the rate in Scotland is in line with the rate in England and Wales. The Scottish Government will continue to pass the funding on to NHS in Scotland. However, for those rates to diverge, it is not entirely clear to me how that shortfall will be made up. Although I know that the minister is acting on actuarial advice, I would be interested to know what conversations have indeed taken place with health colleagues. Again, it would be interesting to know why an updated financial memorandum was not published ahead of stage 3. However, I recognise that there is an opportunity to review the process. There are colleagues who wish to see the rate somewhat higher than what the minister has proposed, others who have concerns that it has increased from stage 1. There is a balance to be struck here. It is impossible to get it absolutely right in every instance, but there are concerns about the process leading up to this point. In conclusion, the bill is very welcome. Like the Civil Litigation Act, it appears to strike the best balance, ensuring that those pursuing personal injury cases have the clarity, the transparency and the security that they need and that it has fairness very much at the heart of it. On that basis, the Scottish Liberal Democrats will be supporting it at the decision time. We now move to the open debate and speeches of around four minutes please. John Mason followed by Jamie Halcro Johnston. Thank you very much, Presiding Officer. I very much welcome the fact that this bill has got to stage 3 today. It seems that we have not had too many major disputes over amendments this afternoon. A lot of this bill is about trying to get the balance right between pursuers and defenders. We are not wanting to overcompensate or to undercompensate. However, it is, frankly, not possible to get every case exactly 100 per cent compensated. In fact, it can be argued that every case is inevitably either over or under compensated. We then have the question, is it acceptable to have 50 per cent of people over and 50 per cent of people under compensated? Clearly, the Government feeling is that that is not an acceptable position and we should reduce the numbers who are undercompensated, and I tend to agree with that. Two contentious issues have been the further margin adjustment and the adjustment to cover tax and financial advice. The reality is that the committee had conflicting evidence on both of those. On the further margin adjustment, the proposal has been 0.5 per cent. ABI and others have argued fairly persistently for a reduction of that to 0.25 per cent. We also heard arguments for an increase as even 0.5 per cent would still leave substantial numbers undercompensated if they live longer, for example, or inflation is higher. On balance, I feel that 0.5 per cent is reasonable and gets the balance about right. The one way that the Government has moved is for tax and financial advice. Again, the committee found it difficult to pin down witnesses, but there was a general feeling that 0.5 per cent may not be sufficient. I think that we particularly felt that at the start of the process, immediately after lump sum had been awarded, most recipients would be seriously beyond their comfort zone and would need substantial amounts of advice at that point. I have to say that I am comfortable that the Government has moved to 0.5 per cent on that. As Ash Denham said, she has acted on the most up-to-date advice. Gordon Lindhurst said that there was a risk of over 100 per cent compensation, but at the same time, some inevitably will be getting less than 100 per cent, just fewer of them. Labour and Daniel Johnson said the opposite effectively, which was that they feel that we should have gone further. However, there seems to be a lack of information on what pursuers actually do with a lump sum. I wonder if that is something that, going forward, needs to be looked at and studied more. Part of me wonders how many of those figures should be in primary legislation, which is more difficult to change and how many could have been in regulations. However, we are at stage 3 now, so it is a bit late in the day to change that. Another issue has been exactly where periodical payment orders sit in the scheme of things. They seem an attractive option to many of us, as they considerably reduce the risk that a pursuer is subject to, for example inflation or life expectancy. However, we did hear evidence that some victims would be against PPO's, perhaps because they do not trust the defender to pay or because they do not want any kind of on-going relationship with the defender. While not trying to tie the hands of the courts, I also think that many of us did not feel that it would do any harm to give the courts a strong indication, as the amendment has done of Parliament's thinking on that point. That is that it should take very seriously the pursuer's wishes. We get to stage 3 today with a bill that greatly modernises the previous system, even though witnesses did not agree on their detailed evidence. I think that they did agree that this was a step in the right direction, and we should actually be legislating on this matter. In particular, the idea that investors would put all their money into guilts, which traditionally have been the safer thing to do, has increasingly seemed unlikely in practice. It is good that the Government has engaged on points that the committee had concerns about, and we have been able to reach a fair degree of consensus today. I do not think that the economy committee actually deals with very much legislation, but I think that we have given this bill a very thorough and fair scrutiny, and I am sure that we will be open to handling more legislation in the future. Jamie Halcro Johnston, followed by Jackie Baillie. Thank you very much, Deputy Presiding Officer. I welcome the opportunity to speak in this final stage of the bill. As members will be aware, I have been involved with the legislation through each of its stages, speaking at stage 1, being involved through committee at stage 2, and now speaking today. The principles around the bill have remained constant, that is, if it is right to make provision to compensate in full those who have suffered injuries while recognising that overcompensation brings its own problems. There has been a long wait for a fairer method of setting the discount rate for personal injury cases. Prior to the bill being brought, it had simply not been reviewed for an extended amount of time. As a consequence, those changes that we are seeing now are significant. When I spoke in the stage 1 debate, I highlighted the importance of the subject that we are dealing with, and it bears some brief repetition. While a lot of it seems technical, ultimately, the rules that we are laying out ensure that individuals, many of whom have been grievously wrong, are compensated. That compensation can mean vital support needed to lead a full life is in place or save a person from the extensive additional costs that their injuries may incur. As the bill has progressed, there have been several positives. The amendments at stage 2 have been broadly welcome. They have now created a better bill. The extension of the review cycle from three years to five years is certainly an improvement. That mitigates a number of the concerns about gaming the system, as has been mentioned, that had existed and threatened to drag legal action out further, creating problems not only for the defender but for the courts too. Setting a requirement to consult a head of reviews of the discount rate, recognising the need to consider changed approaches, will improve these reviews and make them more worthwhile exercises. At stage 3, there are a number of amendments that are technical. I will not dwell long on those, but the main Government amendment of substance, however, is the change to the adjustment for investment charges and taxation contained in amendment 9, raising it from 0.25 per cent to 0.75 per cent. The minister will be aware that, in our stage 1 report, the Economy, Energy and Fair Work Committee outlined that it was content with the approach that was previously presented in the bill when it came to the two standard adjustments. That new change is on a minor one, nor do we have a full sense of the cost both to businesses and the public sector of making it. When I submitted a written question to ministers last year, it seemed that they did not have a full picture of the cost of damages claims of this nature to the public purse. In terms of its impact on local authorities, for example, we seem to have drawn a blank. Much of the discussion around the bill was based on the previous 0.5 adjustment, and, as we might expect, that was the basis of the evidence that was taken by the committee. It is disappointing that this amendment is being brought in this way and at this time. On periodical payments, amendment 1 by Jackie Baillie is the key change in this area that is being proposed. I have heard the discussion at stage 2 and appreciate that what we are now presented with is quite different from earlier amendments. This amendment proposes that special regard be given to the pursuer's wishes when a court is considering its approach to a PPO. Ultimately, that leaves the decision to the court to apply in individual circumstances. We heard evidence before the committee that pursuers may be concerned at being seen to be forced into future relationships with the defender through the PPO. Ultimately, that ought to remain a decision for the courts in light of individual circumstances, but this amendment provides additional scope for the pursuer to be at the heart of the decision-making process. The bill is worth supporting in many ways that it is overdue, and I appreciate that ministers have taken some cognisance of the committee's recommendations and the issues that have been raised here in the chamber. That being said, there remain some concerns—I think legitimate ones—about how the changes will operate in practice, particularly with the substantive issue of the standard adjustment that I have spoken about. Questions remain. Jackie Baillie, followed by Angela Constance. Presiding Officer, I am grateful for the opportunity to contribute to this final stage 3 debate on the damages, investment returns and periodical payments Scotland bill. Let me also congratulate the bill team, the minister, the clerks to the committee, thank them and indeed thank the Association of Personal Injury Lawyers for their assistance in considering this bill. I think that this is the minister's second bill taken through Parliament. It is an achievement of which she should feel proud. Some may regard this as a very dry technical bill, but it can have a profound effect on those who are having to seek compensation. That said, I hope that the provisions of this bill will not apply to many people, because we are, of course, talking about people who will have experienced catastrophic and life-changing events. It is clearly desirable that a few people experience such trauma and its consequences, but the bill does an important job in focusing on dealing with compensation, how it is calculated and how it is paid. During the committee evidence stage, it was clear that, whilst pursuers and defenders may have very different views on whether there was likely to be over or under compensation, there was agreement about the need for fairness and clarity. The Scottish Government is clear in its policy intention to achieve 100 per cent compensation for people to whom a personal injury award is made. We all agree with that objective. Those who are responsible for paying out compensation, the defenders, believe that the Government is being over-generous and that their assumptions about investment are far too cautious. For example, they suggest that investors will invest in equities and not just fixed assets on which there is a lower return. Those who represent pursuers believe that any notional portfolio of investment should be on a no risk basis and that they believe that there may be a danger of under compensation. Having listened to the evidence, I think that the Scottish Government's approach is right. Although it is not a no risk, it is a low risk and strikes an appropriate balance between the defender and pursuer interests. At the end of the day, most people with a personal injury award will not have considered an investment portfolio before. They are likely, as most of us would do, to err on the side of caution. I think that there may still be a need for further work around the standard adjustment for financial advice and tax, but I recognise that we have pushed the Government further than it was originally comfortable with. As I said in the earlier debate on amendment 9, I welcome the movement from the minister to a rate of 0.75 per cent. It is an increase of a quarter of a per cent on the previous figure, but I will take that anyway. I know that the standard adjustment in this area is under consideration by colleagues south of the border, the UK Government, and the Ministry of Justice. I am just ever so slightly bemused at the Scottish Tories arguing against the position of the UK Tories until, clearly, somebody found the front bench and they all decided to abstain and said. However, there you go. However, there is no doubt that I think that this is a step in the right direction, but when you consider the evidence that the committee heard, I think that we should acknowledge that it may not be enough. A range of very reputable financial advisers, expert in personal damages, pointed to a much higher level of costs for tax and advice. I am not going to rehearse the arguments again other than to say that even the Government actually suggested a range of costs, yes, at the lower end of 0.5 per cent, but up to 2 per cent. Therefore, I would ask that the minister ensures that that is kept under close review and the figure adjusted with experience should that become necessary. Finally, Presiding Officer, I want to touch very briefly on periodical payment orders, and I welcome the Government's support for my amendment. That was something that I had pursued and, indeed, Angela Constance had pursued in both the committee and during the stage 1 debate in the chamber, and it recognises quite simply that, at the end of a lengthy and often distressing court process, the views of the pursuer are given due consideration by the judge before deciding on whether to make the award as a periodical payment or as a lump sum. Overall, Presiding Officer, I hope that the bill will make a positive difference to the experience of people that have pursued a claim for personal injury, and I am therefore pleased to support the bill at decision time this evening. The last of the open debate contributions is from Angela Constance. Thank you, Presiding Officer. It has been repeated throughout the parliamentary process for this bill that, while the number of people directly affected and indeed the number of people who will be affected, as Jackie Baillie says, is, hopefully, small, it is, nonetheless, crucial legislation that the minister has brought before us. As I said during the stage 1 debate, this legislation is crucial to those who have suffered the consequences of, say, an accident at work or a birth that did not go to plan or a lack of care or negligence by an individual or an organisation, meaning that an individual lives with the tragedy of no longer being who they were meant to be nor leading the life that they have worked for or dreamed of. As Liam McArthur pointed out, although the bill is quite a discreet bill, it is part of a wider package of reform also. The time that I have available to me, Presiding Officer, I principally want to focus on periodical payment orders. As we know, the committee heard a substantial amount of evidence about the risks that victims of personal injury bear with compensation, particularly if it is received in a lump sum. No matter how good the legislation is, it is calculating an award for damages, particularly for future loss. Of course, we can be confident that the legislation before us is much improved. It was good to begin with, but it is improved as a result of stage 2 and stage 3. It is fair to say, as John Mason has said often, that it is not an exact science and never will be. The risk of undercompensation can be minimised, but it can never be removed entirely. It is important to remember that damages are not surplus funds. They are meant to replace loss of earnings and future care costs. Professor Vass gave very powerful evidence when she advised the committee of inflation, bust and care costs, the unpredictability of life expectancy and, of course, the costs in and around specialised services and accommodation. All those points to the advantages of a periodical payment order. The bill will, for the first time, give the courts the power to impose periodical payments, but crucially, where the continuity of payments is secure. However, the committee also heard evidence from Patrick McGuire, from Thomson, Solisters and others, who expressed concern about a victim potentially being forced to accept a PPO. How disempowering that could be for someone who has already suffered a catastrophic injury and had to endure a somewhat lengthy court process. The minister acknowledged that, for some pursuers, they will want a clean break from those responsible for their injury. Jackie Baillie rightly pointed out that we will in the future see a combination of PPO's along with a smaller lump sum. The committee recommended that the Government bring forward amendments to give more weight to the views of the injured person. The minister, during stage 1, gave a very clear commitment to take matters forward. I am pleased that she has done that in collaboration with other members, particularly Jackie Baillie. It is very apt that the matter was addressed in the very first and subsequent amendment in today's stage 3 proceedings. The wording to have special regard to the pursuers' needs is particularly apt and somewhat poignant in that regard. I welcome the fact that the minister found a way forward to ensure that the voice of those who have suffered injury and their preferences is listened to, that it is given appropriate weight and that we, therefore, are not adding to the feeling of powerlessness that is all too frequent in the lives of those with significant disabilities, illness or injury. The objective of the bill, as the minister highlighted earlier, was to be clear, transparent and fair. In my view, the bill meets those objectives. I congratulate the minister and our bill team. We move to the closing speeches. I call Daniel Johnson for around four minutes. Thank you, Deputy Presiding Officer. I will try very hard not to repeat any of the arguments that I have already laid out. Let me just touch on some of the points that I think have been quite usefully made through debate. I would like to begin with John Mason. I think that he set quite a good analysis at the beginning of his remarks. I am really asking the question of what we want to achieve. There are two approaches of trying to get it right every time, which is an impossibility, or do you want to minimise the situations where you have undercompensation? Ultimately, that is the approach that the Government is taking, and it is undoubtedly the right approach. If we seek to simply average off, there are going to be individuals who, through no fault of their own, will be disadvantaged, and we must have a regime that seeks to avoid that. The very fact that we have some defenders, or those who represent defenders, saying that the Government has been over-generated is possibly, and dare I say, a good sign. We cannot have a system whereby simply the net result is right. It has to be a system where we get it right more often than we do not. That is why, throughout the passage of the bill, I have asked the question of not just asking about what a reasonable person might do, but what might the more vulnerable person do under these circumstances? The most relevant question that John Mason posed was, what do pursuers actually do with money, what actually happens, and we do not know. That is something that we will have to be monitored and reviewed, because I do not think that we can expect, as Jackie Baillie pointed out, that those who are awarded damages to suddenly become investment experts and always make the right investment decisions. Ultimately, that is a bill that is a series of balances, and that is possibly the most important one. We must continue to view those people as vulnerable people. They cannot be expected to become investment experts overnight, which is why it is perhaps no surprise that amendment 9 was a matter of some debate, but it is important that it is kept under review. I would also like to address the points around public bodies and what happens in the case of under-and-over investment. Ultimately, it is our public bodies that are the ultimate guarantor in both situations. We have to be concerned about the situation where there is possibly overcompensation, where bodies such as the NHS or other public bodies might have to fork out higher bills. However, the risk of undercompensation is that those self-same bodies will then have to meet the needs of those people who are undercompensated. The shortfall that might arise or could arise if those people are undercompensated would be met by social services and health services having to support that person, because they do not have enough money from the damages award. The balance is on both sides, and it is far from one-sided. I would like to raise another point about interactions, which Liam McArthur rightly highlighted in two key interactions. Obviously, we have to be mindful of changes being made by the UK Government. Indeed, perhaps even the front bench needs to be mindful of changes being made by the UK Government to the amendments that they seek to support or otherwise. The civil litigation bill and the bill will clearly work to a degree in consort. It will look at how private individuals can seek redress through the courts for situations that are not there for, but are clearly going to have significant impacts on them. What we cannot do is have another regime. Indeed, as the last one turned out to be where the world moves on and the legislation is unable to keep up, the bill clearly has the ability to have that flexibility and to keep up with the five-year reviews, which is a welcome point. Obviously, we need to make sure that all aspects of the bill, including all the calculations of discounts, are reviewed, because the world moves on. The remark is that, obviously, where those discounts are baked on to the face of the legislation, that will require a more careful consideration about how they are updated. Ultimately, that is a bill that will help those who have suffered a great deal of loss, and hopefully will be of a great deal of help to those who are pursuing compensation through the courts. I am very pleased to contribute to this afternoon's debate on stage 3 of the damages and investment returns and periodic payments at Scotland to Bill. I thank those who provided submissions to the economy committee, the witnesses who attended and the constructive approach taken by members of the committee and the minister and her team. As other members have said, while the bill is technical in nature, it is also very important. It provides for a new statutory regime to calculate the personal injury discount rate that applies to compensation awards in personal injury cases. The Scottish Conservatives welcome the passage of the bill. As Angela Constance said, although the discount rate will only apply in a relatively small number of cases, the impact for the individual and the family's concern is life-changing, and it is to be welcomed by the additional transparency and clarity provided by the legislation. Under Scott's law, the role of compensation is to restore the injured party to the extent that a financial award can, as closely as possible to the position that they were in before the injury. When assessing the amount of a lump sum award, courts take into account the net rate of investment return that the injured person might expect to receive from a reasonably prudent investment of that lump sum. That is what we have been referring to as the discount rate. As I think pretty much every member has said, it is not always a science. Despite having some reservations in relation to the investment charges adjustment, which was the basis of our discussion over amendment 9 earlier, the Scottish Conservatives will be supporting the bill at decision time this evening. Before the introduction of the bill, there was general consensus among defender and pursuer groups on the need to update the system, the need to increase the availability of periodic payment orders and to give courts further powers to introduce periodic payment orders, and the need for regular reviews of the discount rate. I am pleased to say that, after stages 1 and 2 revisions, the bill now deals with those issues. We are pleased that the minister brought forward amendments at stage 2 to change the review cycle for the notional portfolio to every five years instead of three years. It is also important that, in changing to a five-year cycle, the Scottish Government recognised the nature of fast-moving investment markets and changes to investment practice in that period and therefore introduced a formal duty to consult stakeholders as part of the review cycle. I am grateful to the minister for supporting my amendment to that effect. It has the advantage of making the legislation clearer and more transparent, which was one of the objectives of the bill. Turning to the notional portfolio set out in the bill, there are still some concerns that the notional portfolio is too cautious. It is too highly invested in fixed assets, which offer a lower return than investments in equities. Likewise, some stakeholders still believe that the Scottish Government is being cautious in its approach to having a 0.75 per cent standard adjustment for investment charges and taxation. We have heard the arguments before with regard to that, but that has to be seen in the context of the further margin adjustment of 0.5 per cent, which acts as an additional buffer to avoid undercompensation. However, we understand the Government's approach to legislating in favour of a risk of overcompensation rather than undercompensation, but, as I mentioned earlier, we have to recognise that that comes at a cost. Some members, Liam McArthur and others, have explored the implications of what those costs might be to the national health service in Scotland and other bodies that self-insure. It could also be borne by small businesses where claims exceed their insurance limit of indemnity. Going forward, it will be important for the Scottish Government to assess the operation of the bill and to continuously assess the change to the standard adjustment and other mechanics of the bill to make sure that the bill and those changes do not have unintended consequences. The Scottish Conservatives will be voting for the bill at decision time this evening. We welcome many aspects of the bill and we hope that it will work in the interests of all stakeholders. I now call Ash Denham to close the debate, and around six minutes will take us to decision time, please, minister. I thank those members who have contributed to this afternoon's debate, and I take a moment to address some of the points that have been raised during the debate. Gordon Lindhurst has raised the point about more detail on what a special regard would mean for the courts in practice, but it will be for the courts to interpret and apply that provision in the circumstances of that particular case. It is not appropriate for us to go too far in speculating as to how that provision will be applied in practice, and I hope that that reassures the member on that point. A point was raised by Gordon Lindhurst and Liam McArthur on the difference between Scotland and England and Wales and what effect that might have on funding for the NHS. Until the respective reviews are completed, we will not know if there will be different rates or not. The financial memorandum, which was specifically mentioned by Liam McArthur, sets out the position as clearly as we can at the moment. The impact of the discount rate can, of course, be mitigated by the use of periodical payments, and the provisions in the bill that relate to PPOs would be helpful to bodies such as the NHS, which would of course be deemed as a secure funder. Daniel Johnson and Jackie Baillie also made mention of amendment 9 in their contributions and just to reiterate that that was the result of advice given to the Scottish Government on analysis by GAD based on the most recent and up-to-date evidence that was available. It will obviously be subject to review ahead of each regular rate review, and it can be adjusted by regulations, just to reassure Daniel Johnson on that point, if the evidence points to the need to do so. The legislation is, in a sense, future-proofed in that way because it is able to be updated by regulation. John Mason in his contribution also made comments on amendment 9 as well, and I note his comments on that. I would also welcome his general comment on the modernising effect of the bill. Finally, I would like to make mention of Angela Constance. In her contribution, she reminded us of the crucial fact that damages are not surplus funds, and I think that that is a point well made. The bill may seem dry and technical, but often it is a detailed and considered approach that is precisely what is needed to address the complexities and challenges that arise when developing a broad solution for what are all individual and unique cases. Whilst fair and full compensation is at the heart, nevertheless the bill aims to strike a balance, remembering that overcompensation is to the detriment of the defender or their insurer, and ultimately it is the general public who would pay either through funding or public services such as the NHS or paying more for their insurance premiums if the balance is tipped too far. Equally, where a pursuer's funds run out sooner than anticipated, they will usually have to fall back on the state for their care and possibly other needs, again a point raised by Daniel Johnson in his contribution. I hope that it is clear that we have listened carefully to what has been said by stakeholders and by the committee and other MSPs during stages 1 and 2. I have been pleased to support the amendments made by the committee at stage 2, and we have agreed some minor amendments to those today to ensure that they work as intended. We know that there are many reasons a pursuer may not want to have any part of their damages paid through a periodical payment. Those might be very practical, for example if there is an element of contributing negligence involved, and therefore the damages award has been accordingly reduced. It may be that the investment of a love sum is the most viable way of making up any shortfall, even if there are risks associated with this strategy. Members spoke very eloquently about the powerlessness that a pursuer might feel should a PPO be imposed against their wishes, and I have sympathy with that prospect. I was very happy to meet with Jackie Bailey on that point to discuss the issues and see if we could reach an accommodation on what would be an appropriate amendment to the bill, bearing in mind that there were legal constraints around what could be done. I think that Jackie Bailey has got the right balance in her amendment in that regard. I also think that the bill overall has picked a very careful path through the competing demands of both pursuer and defender interests. It was defender interests supported by the committee in their stage 1 report who pressed for change in the frequency of review from three years to five years. I also tabled some amendments of a minor nature here today, which respond to the points from the Association of British Insurers scrutiny of the bill. Equally, I was pleased to bring forward amendments agreed to at stage 2, which ensure that, where proceedings to vary an order for periodical payments are raised, the pursuer should continue to receive the protection of qualified one-way cost shifting, as that is in the spirit of the legislation as it relates to personal injury actions. The amendment debated earlier, which increased the standard adjustment for tax and investment management costs is one that simply preserves the interdependencies and therefore the integrity of the methodology for reaching a new rate and ensures that it remains robust and fit for purpose. On that note, I think that it would be helpful to focus on one of those provisions in particular. I would like to talk about the hypothetical investor, because it is the constant in the bill. Any changes to the investment portfolio, whether they be of the asset type or their percentage allocation, can only be made where the end result is that the notional portfolio remains suitable for investment in by the hypothetical investor. The characteristics of the hypothetical investor have been very carefully formulated to capture the likely investment objectives of a pursuer. Importantly, the bill has also been future proofed, so that Scottish ministers have the tools and the flexibility to ensure that all of the components necessary to arrive at a rate or rates can be kept up to date. That will allow ministers to ensure that the legislative framework for setting the rate remains appropriate. Finally, I would like to repeat my thanks to all those who gave evidence to help to improve the bill during its parliamentary process, and I commend the motion in my name, Presiding Officer. Thank you very much, and that concludes stage 3 proceedings on the damages investment returns and periodical payments Scotland bill. We will move on shortly to decision time. Thank you very much. If we come to decision time and there is only one question this afternoon, the question is that motion 16394, in the name of Ash Denham, on the damages investment returns and periodical payments Scotland bill, be agreed. Because it is stage 3, I would ask members all to press their voting buttons. Members may vote now. Thank you. The result of the vote on motion 16394, in the name of Ash Denham, is yes, 112. There were no votes against, there were no abstentions, the motion is agreed, and the damages investment returns and periodical payments Scotland bill is passed. That concludes decision time. We will move on shortly to a member's business debate in the name of Stuart McMillan on Scottish Tourism Month, but we will just take a few moments for members and the minister to change seats.