Equitable Life — House of Commons, 2019-01-31
Topic: Labor
Andrew Egan Henderson Hendry (Scottish National Party, Centre-left): Today we have heard a powerful and consistent voice across this Chamber to end this scandal. I pay tribute to the hon. Member for Harrow East (Bob Blackman) for bringing this debate to the House. Like all former councillors, he cut straight to the heart of the matter and how it affects people’s daily lives, and he did so with eloquence and controlled anger. He is right to be angry on behalf of the people who have been affected by this scandal. He laid out the history and pointed out that it is a Ponzi scheme, and he is right that it has been a web of greed and exploitation leading people to this point. I add my voice to his clamour for the Government to honour, in full, the support needed by the victims, and I back his three asks in getting past this situation The hon. Member for Leeds North East (Fabian Hamilton), who is not in his place, talked about the life-changing negative effects of this issue, and has been a constant champion of the victims. [Interruption.] I am glad that he returned in time to hear me say that. He mentioned the report that described a decade of regulatory failure. It gave a well-informed exposition of the issue, and mentioned two shocking statistics—that 100,000 cannot be traced and over 15,000 people have died. What a disgrace The right hon. Member for New Forest West (Sir Desmond Swayne) and the hon. Member for Torbay (Kevin Foster) asked how people having to save for their retirement can have confidence in the system when this matter has been allowed to drag on in this way and left in this state of affairs. They also, quite rightly, pointed out that this is creating a framework for hostility towards pension saving. The hon. Member for North Tyneside (Mary Glindon) underlined those points. The right hon. Member for Haltemprice and Howden (Mr Davis), who is no longer in his place, said that it was a failure of Government to have dealt only partly with this. He should know. He is an expert in failures of Government, so we should listen to him The hon. Member for Blackpool South (Gordon Marsden) said that there was a "Bleak House"-type history to this, and, as many others did subsequently, talked about the opportunity to get some of the money back on the RBS shares as a way of settling this scandal for people. That should be taken on board. The hon. Member for Strangford (Jim Shannon) talked about the choices that Governments make. As a DUP MP, he knows about the choices that this Government make in terms of spending their money. There are lessons to be learned by Government Front Benchers on this. The hon. Member for Erewash (Maggie Throup) also underlined some of the things that need to be done by the Government, so I hope that the ministerial earplugs were left behind before the Minister came into the Chamber today. Let us be clear: the only thing equitable in this whole saga is the name "Equitable"; everything else about it has been rotten. This scandal has simply been allowed to continue beyond any reasonable timeframe. So as Equitable Life is finally wound up, the UK must now, belatedly, ensure that justice is delivered for those affected by this scandal. That means dealing with the issue of compensation, and that can only be done when the loss is fully quantified by negotiating the correct sums involved. The EMAG website states that the £1.5 billion covers only 20% of the losses incurred and argues that there should be Government action to pay full compensation. At the moment, there is a huge gap between what is required and what the Government have set aside in their £500 million fund. I ask the Minister: when will the compensation be fully agreed In June 2018, it was announced that Equitable Life would finally be shutting down, with a surprise £6,900-a-head windfall for the last remaining policyholders, while about 261,000 people will have a share in a £1.8 billion pay-out following the transfer of its business, Reliance Life, through unlocked capital. That is good news, perhaps, for those who have hung around, but the 800,000 former policyholders—the vast majority—who were shifted to other providers or encouraged to cash in and cut their losses will get nothing from that. EMAG says that policyholders who left Equitable Life will still remain £2.5 billion out of pocket. As Paul Braithwaite of EMAG said: "Equitable has crafted an elegant termination strategy for the small number of remaining members, but it will be no benefit to the vast majority of victims. If the remaining members vote in favour of this deal, they are likely to come out ahead. But for every one of them, there are five who left the society who are much worse off." That vote, as we know, will go ahead in the coming months The UK Government must now finally deal with the outstanding injustices felt by these aggrieved policyholders. Those people saved throughout their lives. They were encouraged—told—to do so by successive Governments in this place. They lost the savings they had entrusted to those whom the Government, in turn, had entrusted to look after them. The Government have not only failed them—they have failed to treat this with the due urgency it requires, or, indeed, the compassion it requires. They failed to compensate them, and that must be put right now. In doing so, the Government must consider the deep impact that scandals such as Equitable Life have on public confidence in pension schemes, and how they could end up actually deterring those who should be saving for their future needs. I therefore say to the Minister: "Let us make a commitment. Let us hear that from you to end the scandal, to belatedly make amends, to make it right, to make it fair, and, with no irony intended, to make it equitable for all those who have suffered."