David Davis MP and Bob Blackman MP write on how ten years on, the Government must right the wrongs of the Equitable Life scandal
As published in the Times:
This year marks two significant milestones in the unfinished fight for justice for the victims of the Equitable Life scandal, in which over a million policyholders lost part of their pension savings as a result of a decade of regulatory maladministration.
It also provides an opportunity for a Conservative government to finish the job it started on this day in 2010 and deliver the full and fair compensation still owed to the victims, ten years on.
December 2020 marks 20 years since the collapse of Equitable life. Overnight, people who worked hard and did the right thing to provide for their retirement had their plans and dreams shattered. Many of those victims are still facing up to the costs.
They are people like Dot, now 96, a Second World War veteran who worked as a freelance journalist while supporting a young family and a husband disabled in the war. Or Don, who flew 19 different types of aircraft in the war, serving his country to help defeat fascism. And Bill who experienced the trauma of the Luftwaffe’s bombing of Liverpool as a child, lived through the privations of war and its aftermath and worked hard to better himself and his family. All three are part of the generation that helped build post-war Britain.
When the parliamentary ombudsman found that there had been a decade of serial regulatory maladministration, we were proud that it was a Conservative-led government that promised swift, fair and transparent compensation. It was, after all, government regulators that were found to have failed in their duty.
Sadly, the victims of this scandal continue to be let down, even though they did what was asked of them and saved responsibly for their retirement.
Ten years ago today, George Osborne, then the chancellor, announced the creation of a compensation scheme. But it was far from the full and fair settlement that was needed. For almost all of those affected, fairness and transparency have simply not been delivered. While some policyholders rightly received full compensation, other elderly pensioners were unfairly excluded and the vast majority — around nine in ten — have had only 22 per cent of what the government accepts they are owed.
We are not talking about rich people here. The vast majority had less than £20,000 in their pension pots. They include teachers and nurses, along with engineers and small business owners – the very people who form the backbone of our country. They were left to twist in the wind while they watched banks bailed out and their customers’ savings protected.
Inevitably, those affected are increasingly elderly and vulnerable. Shamefully, thousands have died without the fairness they were promised and more will do so with each passing week. They and their families cannot understand why a government that values hard work and self-reliance would refuse to repay the money it has itself acknowledged is owed.
The reason given by the coalition in 2010 was the state of the public finances. We Conservatives worked hard to repair them in the intervening years, yet despite calls from MPs across all parties the Treasury has consistently refused to make further compensation available.
Coronavirus has once again placed the public finances under enormous pressure and it will be a major task to rebuild them. But a debt is a debt. It was an unsettled debt of honour in 2010 and remains so today. The ombudsman said the victims should be put back in the position they would have been in had those failings not occurred. The government accepted her findings and recommendations “in full”.
That compensation must also be seen to be fair. There are serious questions about the accuracy of the payments made to date. The Equitable Members Action Group has documented cases where the calculations have been wildly inaccurate. Both policyholders and parliament need to be reassured that a further injustice has not taken place. Yet despite repeated requests from the Commons public accounts committee and campaigners, the Treasury has not been fully transparent about its methodology and calculations.
Even after all this time, support for this cause remains as strong as ever, with victims in every constituency. The all-party parliamentary group for justice for Equitable Life policyholders, of which Bob Blackman is co-chairman, is one of the largest in parliament, with over 260 MPs signed up, including 108 Conservative backbench colleagues. As MPs from across the Commons and from all intakes we are determined to continue to represent the victims of this scandal and push for the fairness and transparency that we, the Conservatives, promised them in 2010.
As the prime minister said earlier this year, no one should be penalised for doing the right thing. As we mark ten years since a Conservative-led government first promised action, we must once and for all put right the wrong that Equitable Life victims suffered because of institutional failings and we must do so now.