Equitable Life — House of Commons, 2019-01-31
Topic: Labor
Richard James Shannon (Democratic Unionist Party, Right): I thank the hon. Member for Harrow East (Bob Blackman) for setting the scene, and the hon. Member for Leeds North East (Fabian Hamilton), who is not in his place, for his help in bringing this matter to the House for consideration. It is always a pleasure to follow the hon. Member for Torbay (Kevin Foster). He usually sweeps up on the Government side of the Chamber and I often do the same on the Opposition side, but we often agree. And here we are again agreeing on an issue that he is interested in as the Member for Torbay, and that I am interested in as the Member for Strangford We all know the background to this story because we have spoken about it many times, but that does not take away one bit from the fact that, as the hon. Member for Harrow East said, it is as shocking today as it was back then. Like other hon. Members, I believe that we should honour the obligation and the pledge. The hon. Gentleman said that very clearly in his introduction. Well, I will tell the House something: I am also here to ask my Minister, of my Government, to honour that pledge. We look to the Minister for the satisfaction that our constituents need, and that is why each and every Member here is present today Let me gently break the issue down one more time, in the hope that the reality of the situation will provoke a greater scale of action some 20 years later. Let us remember that the Equitable Life victims are typically retired nurses, teachers, civil servants, factory workers, shop workers and small business owners who had no choice but to set up a personal pension. Before I was elected to this place in 2010, I was a Member of the Legislative Assembly in Northern Ireland, and one issue that came to my attention then was that of the Equitable Life policyholders, especially as there are dozens in my Strangford constituency. Unfortunately, some of them have passed on, so they never had the satisfaction of seeing this being addressed. I am here to uphold the policies of the people who are still living and to express some disquiet about those who have not had that satisfaction. With all our busyness as Assembly Members and MPs, I tried to address this matter along with many other Members, because this is not just Jim Shannon; this is everybody together—Members of all parties, on both sides of the Chamber—recognising that a wrong has to be righted There are people who have worked hard and worked away to secure their retirement, but to date almost 1 million pension savers have received less than a quarter—some 22%—of the losses they incurred when the Equitable Life Assurance Society nearly collapsed. Just before I was elected to this place in 2010, I was contacted by people in my constituency who had been stung by the Equitable Life scandal, and they all pointed to the fact that the parliamentary ombudsman clearly concluded in 2008 that the victims’ loss was directly attributable to a decade of serious, serial regulatory maladministration. In fact, just last year the Treasury admitted that it was culpable for the scandal. That is the story, so we look again to the Minister for his response In 2010, I can well remember the Government accepting that victims’ losses amounted to £4.3 billion, and I was disappointed at the allocation of £1.5 billion for compensation—a decision that was justified on the basis of the perilous state of the public finances, as other Members have mentioned. I was a member of the APPG that secured a small victory in 2010 with the passage of the Equitable Life (Payments) Act 2010 and the establishment of a scheme to pay limited compensation to qualifying Equitable Life members. But this payment was not enough, and the people who are missing out are the most vulnerable. The compensation amounted to only 22.4% of the relative losses of 895,000 traced pension savers. This was the sum left after compensating the people with annuities who had already retired. Ensuring that this large cohort of pension savers receive the unpaid balance of the full 100% of their relative losses would cost £2.6 billion. May I suggest that, when our finances are better, this small figure should be considered in order to bring the situation to a conclusion In the 2013 Budget, a cohort of 9,200 with-profits annuitants who took out contracts before 1992 received only £5,000 each, or £10,000 if they were eligible for pension credit. I stand today to support the call for these victims, who are the oldest and most vulnerable, to be afforded the same treatment as their younger counterparts, who bought their annuities later. We have a duty to deliver this. It would cost an estimated £100 million and could be funded today from the unspent £140 million in the Treasury’s coffers from the current scheme. If the money is there, let us do what is right. It seems like simple mathematics to me I am well known as someone who does not advocate borrowing like there is no tomorrow. I have a bit of Ulster Scots in me—every pound’s a prisoner. We are very careful in what we do, and that was instilled in me by my mum and dad.