Ministers are considering plans to replace lump-sum damages for victims of NHS blunders with a new system of annual payments that will compensate victims for their needs.

The Times reports that the government is also set to introduce a no-fault compensation scheme for the families of babies whose brains are damaged during birth, and a fast-track scheme for minor mishaps.

The action is a bid to cut soaring NHS litigation bills, with as much as £4 billion of the NHS budget set aside for outstanding negligence claims.