NHS reveals £1bn litigation bill

Spending by the NHS Litigation Authority on negligence claims has passed the £1bn mark for the first time.

Annual accounts for the 2011/12 financial year show that £1.095bn was spent on clinical claims by NHS trusts, foundation trusts and primary care trusts in England. A further £182m was spent on claims involving the Existing Liabilities Scheme, covering claims against the NHS where the incident took place before 1 April 1995.

Expenditure on non-clinical claims, such as accidents suffered by staff, patients or visitors at NHS sites, was more than £51m. In total, spending on claims against the NHSLA rose by almost 46% in a year, despite legal costs falling by almost 10% over the same period.

This was largely due to a sharp rise in new claims reported in 2010/11, when all trusts faced a 30% increase in clinical claims, that were settled last year. The growth in new claims appears to be slowing down (last year’s rise of 6% was the lowest increase for three years) but still stood at a record-breaking 9.143 for 2011/12.

Tom Fothergill, director of finance, said: ‘The financial year 2011/12 has seen further increases in claims activity at every level of the NHS LA’s work.

‘We were able to close more claims than ever before, but the combined effect of sharply increased claims in recent years and a continuation of the growth in new claims received this year, still resulted in there being 5% more claims open at the end of the year.’

Claimant lawyers accounted for almost 80% of legal costs, although both claimant and defence lawyers reduced their costs, by 7% and 21% respectively. The average number of years taken to settle claims fell from 4.71 to 3.54 in 2011/12, whilst more than one-third of resolved claims did not require any damages to be paid to the claimant.