The House of Lords tomorrow (Tuesday) could take a key step to controlling the rising cost of clinical negligence claims, according to GP leaders.

The need for action is “urgent”, according to a campaign group which includes the Academy of Medical Royal Colleges, the Family Doctor Association and the British Medical Association.

Last year the NHS spent £1.7 billion on clinical negligence claims.

The Lords are to debate a bill which will require the legal system to change the way it calculates compensation payments.

The Lord Chancellor caused consternation last year when he announced a negative discount rate – of minus 0.75% – for calculation of claims.

A negative discount rate would mean claimants are paid more for future years than for the present – on the grounds that the value of any cash award would diminish with deflation. Normally future payments are reduced because awards can be invested and earn interest or dividends.

The Lords bill would require the courts to change the way they make these calculations.

Niall Dickson, chief executive of the NHS Confederation, which has organised the campaign, said: “The rising cost of clinical negligence is unsustainable and means vast resources that could be used by the NHS are being diverted elsewhere.

“We fully accept there must be reasonable compensation for patients harmed through clinical negligence, but this needs to be balanced against society’s ability to pay. Money used for this purpose cannot be spent on frontline care.

“The time for action is now. That is why the NHS Confederation has joined forces with a range of interested organisations to urge MPs and peers to act.

“While we welcome changes to the way the discount rate is set, a wider programme of reforms is needed and we urge the Government to be bold in introducing a strategic approach to control legal costs, ensure fair compensation payments are based more closely on the needs of claimants and to reduce incidents of harm from happening in the first place.”