Mike Hancock News
MP calls for justice for Equitable Life victims
Mike Hancock has written to the Chancellor and backed a parliamentary motion calling for immediate compensation by the Government for victims of the collapse of Equitable Life. This comes as the Parliamentary Ombudsman, Ann Abraham took the very unusual step this week of issuing a further report to MPs on the saga and condemned the treatment of Equitable Life victims by the Government as "deeply disappointing" and calling for the Government to compensate former Equitable Life policyholders. Mike Hancock will also be attending a meeting of organised by the Portsmouth branch of the Equitable Members' Action Group at the Queens Hotel on 8th May 2009 at 6pm
Mike has today supported the Ombudsman's demand by backing a Parliamentary Motion calling for Government to accept her recommendations and he has also written to the Chancellor calling for immediate compensation to be paid in line with Ombudsman's recommendations.
Hundreds of thousands of Equitable Life customers have seen their pensions wiped away after the group almost went bust in 2000. Previous reports by the Parliamentary Ombudsman found that the authorities guilty of 10 counts of maladministration. However the Government has dragged its feet and still hasn't set up a compensation scheme and in the intervening time over 30,000 policyholders have died.
If the Parliamentary Ombudsman thinks that an injustice is not being remedied, following a report by her, she can issue a further report to both Houses of Parliament. This is though an extremely unusual step and it is only the fifth time since the creation of the office in 1967 that the Ombudsman has taken this step.
Mike Hancock said: "Many Equitable Life policyholders have seen a large part of the pension that they saved for wiped out through no fault of their own. They relied on the Government and the authorities to properly regulate pension providers such as Equitable Life. The independent Parliamentary Ombudsman found that they did not do that.
"The titles of the two reports really sums up everything that you need to know about the saga - today's report is entitled "Injustice unremedied: the Government's response on Equitable Life" and her previous report was entitled "Equitable Life: A decade of regulatory failure." But instead of accepting the ombudsman's findings and compensating policyholders for the regulatory failings, they have used every cynical trick in the book to drag their feet and duck their responsibilities. The Government has kicked this into the long grass, they should be ashamed of the way that they have acted. Quite simply they should act now to compensate Equitable Life policyholders. I will be doing all that I can as an MP to see that they do."
Darren Saunders, Liberal Democrat Parliamentary Candidate for Portsmouth North said: "I hope that the Labour MP for Portsmouth North will also back calls for proper compensation for Equitable Life policyholders as demanded by the Ombudsman. The way her Government has acted over this as been outrageous. Certainly if I was elected as the MP for Portsmouth North I would be voting for immediate compensation for Equitable Life policyholders as demanded by Parliamentary Ombudsman."
Notes: Mike Hancock has signed EDM 1423
"That this House notes the Parliamentary Ombudsman has taken the unusual step of using powers under the 1967 Act to present Parliament with a further and final report on Equitable Life; also notes that the Public Administration Select Committee's second report on Equitable Life, Justice denied? concluded that the Government response to the Parliamentary Ombudsman's report was inadequate as a remedy for injustice; recognises the vital role the Ombudsman plays in public life; reaffirms the duty of Parliament to support the office of the Ombudsman; believes the Government should accept the recommendations of the Ombudsman on compensating policyholders who have suffered loss; welcomes the formation of the All-Party Group on Justice for Equitable Life Policyholders; and notes with regret its necessary formation and the fact that over 30,000 people have already died waiting for a just resolution to this saga."
Mike's letter to the Chancellor is as follows:
06 May 2009
Dear Chancellor
I am writing to you about Equitable Life. As you will be aware the Parliamentary Ombudsman has issued a report today entitled "Injustice unremedied: the Government's response on Equitable Life". Her previous report was entitled "Equitable Life: A decade of regulatory failure." Really the titles of both these reports tells you virtually all you need to know of what the Parliamentary Ombudsman as an independent investigator thinks of these matters.
The Ombudsman said today: "The Government's response to my report was deeply disappointing. It provided insufficient support for the rejection of my findings of maladministration and injustice..."
I understand that the response that the Parliamentary Ombudsman refers to was for the Government to asked Sir John Chadwick to advise it on an alternative ex-gratia scheme to that proposed by the Parliamentary Ombudsman. But this as I say has come in for heavy criticism from the Parliamentary Ombudsman and for former Equitable Life members as not fulfilling what she recommended not to mention further delaying things. The Ombudsman says: "Whatever the outcome of the work to be done by Sir John, it is clear that not everyone who has suffered injustice will be eligible for a payment and that not all of the injustice suffered will be put right. The injustice I identified in my report will not therefore be remedied as a result of the Government's response."
In her previous report the Parliamentary Ombudsman said: "a compensation scheme should be established to assess the individual cases of Equitable's current and former policyholders, with a view to paying compensation to remedy any financial losses which would not have been suffered had those people invested elsewhere than with Equitable."
The Ombudsman clearly found that the reason the Equitable Life members suffered losses was due to "serial regulatory failure." She said "the public bodies responsible for the prudential regulation of insurance companies... and the Government Actuary's Department failed for considerably longer than a decade properly to exercise their regulatory functions in respect of Equitable Life."
As you are aware, it is a very serious matter for the Ombudsman to lay a further report before the Houses of Parliament. Justice delayed is justice denied - particularly in this case when it involves people's pensions. Unfortunately some policyholders are dying and so have been denied the pension which they saved for due to the failure of the authorities.
Others are obviously denied the pension in their old age that they thought they were prudently saving for. If the regulatory authorities had not failed in this way many times and done their job properly, they could have invested their money with other sounder financial institutions and now have a proper pension from that.
This is a very serious matter and also now a very urgent matter for the reasons I outline above. I hope that you will urgently consider the Parliamentary Ombudsman's further report and come forward with a proper compensation scheme and make a statement to Parliament very soon that you are doing so. What the ombudsman is asking is that former Equitable Life policyholders are put in the same position as if they regulators had done their job properly and if they had done their job properly they would have known that Equitable Life was not financially sound and they would have invested with a different company. This seems a more than reasonable request.
This Government has talked in the past much about fairness and justice and it now has the opportunity to put those fine words into practice and remedy an injustice.
I look forward to you do so and receiving your reply as matter of urgency as many MPs, many of my constituents and their families and former Equitable Life policyholders across the country are urging and relying on you doing so.
Best wishes
Yours sincerely
MIKE HANCOCK CBE MP
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