Equitable Life Pension Policies
Equitable Life essentially collapsed in 2000 when it closed to new business and reduced payouts to its existing members.
- When Liberal Democrats entered Government in 2010, we announced a compensation commitment of £1.5 billion - the Equitable Life Compensation Scheme - and in the 2013 Budget, we provided an additional compensation package for more than 9,000 people who had bought an Equitable Life With-Profits Annuity (WPA) before 1 September 1992 and are aged over 60. These people had not been entitled to compensation as part of the first compensation scheme announced in 2010.
- We took action because the group of people affected were under unexpected financial pressure in their later years after not receiving the income they had bargained for with their Equitable Life policies they had bought over 20 years ago.
- As of 30 June 2014, £972.9 million had been paid to 877,414 policyholders.
- The action we took was welcomed by the Equitable Members' Action Group (EMAG).
- The Equitable Life Payment Scheme has now contacted all the policyholders it could trace but if people think they are eligible for compensation and have not been contacted, they should get in touch with the scheme. Approximately 160,000 policyholders who are due compensation have not yet been traced or properly validated.
- Equitable Life collapsed on Labour's watch in 2000 but Labour failed to help those who had lost money. Labour's economic mess was embodied in Equitable Life's failure. And they even used the government whip in 2009 to defeat an early day motion from Vince Cable to compensate Equitable Life victims.
- The Parliamentary Ombudsman reported on 10 instances of maladministration by Government officials and regulators around the time of Equitable Life's collapse.
- Liberal Democrats have taken action in Government to improve regulation in financial services. Our Banking Reform Act 2013 implements key recommendations of the Parliamentary Commission on Banking Standards.
- We have put the Bank of England at the forefront of the supervisory regime and have given it new powers to address risks as they emerge to prevent another bank collapse. We've also brought in new laws to separate high street banking from the trading floor in the City. A more stringent approval regime for senior bankers has been brought in and we are committed to increasing competition in the banking sector so consumers have more choice.
There have been 10 Early Day Motions on the Equitable Life scandal, but they dried up in 2009, though there is an All Party Parliamentary Group looking at the issue. In my view they need to do more than just look.
The members of EMAG are quite rightly still seeking full compensation and have even offered to take part payment per year over the next parliament until the money is fully compensated. Surely it's time to put this scandal to bed? Too many claimants have already died waiting.
I believe the government as made I start on compensating the victims of this scheme but I don't believe the compensation offered is yet enough. Therefore if elected I will press the government to increase the payments to the known and traced victims. Particularly as there appears to be over £500 million sat in a pot that could be used to help people and is currently not helping anyone. Therefore, as soon as, I know the procedures of the House, I will be very happy to introduce a new Early Day Motion to ensure that this matter stays under constant vigilance and I will work to ensure that policyholders get the full compensation that they should have had well over a decade ago.
There is no official party policy on this issue, but I know there are are many candidates from around the country willing to press this in the next parliament.
I hope this answers your question.