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Equitable Life

Volume 511: debated on Tuesday 8 June 2010

7. What steps his Department is taking in respect of payment of compensation to Equitable Life policyholders. (924)

9. What steps his Department is taking in respect of payment of compensation to Equitable Life policyholders. (926)

15. What steps his Department is taking in respect of payment of compensation to Equitable Life policyholders. (932)

The coalition Government have pledged to make fair and transparent payment to Equitable Life policyholders, through an independently designed payment scheme, for their relative loss as a result of regulatory failure. The Queen’s Speech announced the Government’s intention to introduce a Bill in the first Session of Parliament to enable payments to be made to Equitable Life policyholders. On the same day, the Government also announced that an independent commission would be established to design the payment scheme. These steps are a strong sign of the Government’s commitment to deliver on their pledge.

More than 60 of my constituents in New Forest East, and indeed even one of my own relatives, will be delighted to know that the Government intend to implement the recommendations of the ombudsman. Can he tell me when this is going to happen—and can he guarantee that the Independent Parliamentary Standards Authority will not be put in charge of making the payments?

I thank my hon. Friend for his question. The intention is that Sir John Chadwick’s report will reach its conclusion in mid-July; at the same time the independent commission will be established. We are making progress in this area—in contrast, I am afraid, to the dither and delay of our predecessors.

I am grateful to my hon. Friend for his previous answer, but he will be aware that many of us have had to put in place our own means of keeping constituents who have got caught up in Equitable informed of what is happening, so poor has been the Government communication programme. So will he say a little more about his plans to keep that group of people informed as the payment scheme goes through?

I suspect that one of the reasons why the previous Government were so poor in communicating progress was that there was very little progress to communicate. As I mentioned earlier, we are keen to ensure that there will be progress, that we have the independent commission in July, and that we will have the conclusions of Sir John Chadwick’s report; we intend to make progress there. I hope that we will have more information to give my hon. Friend in mid-July. This is a matter that has caused enormous anxiety for many people, and it is right that we keep people up to date with exactly what progress we are making.

I would like to follow up those questions on Equitable Life. Over 1 million policyholders were affected by the fact that the previous Government did not accept the ombudsman’s proposal that they be compensated. I am particularly worried that many people have died during the whole process; the previous Government was rather cynical in that respect. May I be assured that, through this process, we will ensure that people are compensated quickly? That needs to be done.

We are keen for the independent commission to design the scheme, but one of the points that we have made clear is that the dependants of deceased policyholders should be included in the scheme to address that point. Clearly, however, my hon. Friend highlights the need to move quickly, after 10 years of inadequate progress.

On the question of Equitable Life, there can be few constituencies that do not contain people who are waiting for payment or people who have died while waiting for payment. Is it not shocking that one of the main perpetrators of the Equitable Life fraud—for that is what it was—will, after last weekend, be able to take up a senior position in a financial institution? Can the Government re-examine what happened in that process, so that these people are not allowed to have senior financial positions in future?

I hope that the hon. Gentleman will understand that I am not going to be drawn on an individual case without all the information in front of me. He has made his point very clear.

First, would the Minister care to share with the House the date that the cheques will arrive through the doors of those who are still waiting for payment? That is the key. My second question is, as people have, tragically, died while the process has gone on and on, will there be compensation for the families that have missed out as well?

Order. To ask a second question was very cheeky on the part of an experienced Member, but I know that the Minister will not be tempted to follow suit.

I fully understand the hon. Gentleman’s concern about delays. He knows as well as I do where a lot of the blame for that lies. I made the point earlier that dependants of deceased policyholders should be included in the scheme. As for a specific date, the only thing I can say is that we are clearly making much more progress than the previous Government did.

Bearing in mind the fact that many of the policyholders are getting older—[Interruption]—surely it is vital that we get money into their hands as quickly as possible.

I do not want to be pedantic, but all of them are getting older. The hon. Gentleman rightly says that there is a need to move quickly. I think that we all feel that. I am pleased that the Government have already announced in the Queen’s Speech that there will be a Bill on this subject. We have already announced a date for the establishment of the scheme. We are making progress. That is a very welcome change from what we have seen in the previous 10 years.