Recommendation 5

The money that government estimates it owes under various compensation schemes has risen in recent years, reaching £73.4 billion by the end of 2024–25, an £11.8 billion increase on the previous year. Annual payments from the government’s current largest ongoing compensation schemes nearly doubled from £2.5 billion at the end of 2023–24 to £4.9 billion at the end of 2024–25, and the total lifetime impact of these schemes is estimated at over £102 billion. A considerable portion of this impact relates to clinical negligence, which the Department of Health & Social Care intends to address through the upcoming NHS Ten Year Plan. We do not question the validity of payments received by individuals through the government’s various compensation schemes, however it is not clear whether value for money has been properly considered in the schemes’ design and administration. recommendation HM Treasury should undertake an international comparison of compensation schemes, to identify learning or best practice that could be applied from other countries’ approaches to how schemes are designed, funded and administered, and report back to the Committee by the end of the year. This should include benchmarking how much other countries’ compensations schemes cost as a percentage of GDP. 5 1 The annual reports and accounts of government Introduction