MP calls for compensation for Equitable Life victims

A commitment to providing full compensation for victims of Equitable Life should be included in the Conservative Party manifesto, an MP has said.

Shipley MP Philip Davies – a member of the All-Party Parliamentary Justice for Equitable Life Policy Holders – said the scandal was unresolved and an “open sore which we have a moral duty to put right.”

Equitable Life nearly collapsed in 2000 after failing to put sufficient funds aside to pay for guaranteed payouts it promised on some of its pensions.

Mr Davies wants a clear commitment from Prime Minister Theresa May she will act.

He said: “These victims are ordinary hard working people who sought to be self-reliant in their retirement. They worked hard, played by the rules and did the right thing but through no fault of their own experienced drastic losses to their personal pension savings as a result of previous government and regulatory maladministration.”

Mr Davies has signed a letter to the Prime Minister urging action, which has cross-party support in Parliament.

He said: “The issue is not affordability. £133billion was found to support the banks who caused the financial crisis that has been used as the excuse for not fully compensating Equitable Life victims. £11 to £13 billion is found every year to fund the shortfall in unfunded public sector pensions. It is clear that if there is a political will, a way will always be found.

“Our economy is far stronger than it was in 2010 and the public finances much improved. We remain convinced there is a fair and practical way forward that could allow for the payment of the  missing £2.6 billion over the course of the next Parliament without putting the public finances at risk.”

The 27 MPs who wrote to Mrs May expressed concern that the average policy value was just £44,000 which at today’s annuity rates, would struggle to cover an individual’s food bill.

Mr Davies said he was proud that the Conservatives legislated for the Equitable Life Payment Scheme in 2010 which compensated people for their “relative loss” but more needs to be done to compensate the victims.

“Until it is resolved, hundreds of thousands of responsible savers, as well as their family and friends, will have little faith in our political and regulatory system,” he added.