Equitable Life

Debate between Baroness Blackwood of North Oxford and Neil Carmichael

Tuesday 20th July 2010 Westminster Hall

[Nicola Blackwood]

The first of the two issues at stake is purely financial—the technical problems of designing a scheme that is fair, transparent, swift and simple. The second issue, which is almost more challenging, is ethical—the admission of responsibility by the Government for regulatory failures and the acknowledgement of what that failure has meant to Equitable Life members.

By failing to admit the full extent of the losses, we will fail on the latter issue, ethically, even if we succeed on the former, financially. I do not see any reason why we need to go down that route. All parties have consistently stated that final payments will have to be balanced against other calls on the public purse. The High Court stated that, as the Government were not required to create a compensation scheme, any legal objections to the nature of such a scheme were bound to fail, so there seems to be no legal barrier.

In my dealings with EMAG, representatives have clearly stated that they understand that full payment may well not be possible, but they want an acknowledgement, at least, from the Government of the full cost that they have shouldered.

[Neil Carmichael (Stroud) (Con)]

We all have big postbags on the subject, obviously. We need clear milestones for delivery. That is what most of my supporters in this connection want—milestones.

[Nicola Blackwood]

Along with the rest of the country, Equitable Life members know that we have been left to clear up Labour’s financial mess. All sections of society will have to do their bit in getting our national finances back on track. If we ask EMAG members to trust us, as their Government, we should trust them to accept that we might be able to pay back only a percentage of their losses. If we attempted to pay out in full, according to calculations that do not have the confidence of the public, we would do significant damage to our credibility for the long term.

The Equitable Life case is a prism of the wider legacy of the Labour Government: public distrust in politicians and Governments is at an all-time low, as a result not just of media-induced cynicism but of Labour’s chronic inability to deliver on its promises or to take responsibility for its mistakes. The case is one of our key tests, a barometer of how straightforward we will be in the face of the tough choices that we have spoken about so often.

I have the greatest confidence that the Government will be honest and open about the extent of the damage inflicted on Equitable Life members and of the capacity of the Government to remedy it. According to the Minister’s own words, he has the compassion to lose no time in setting out a detailed programme for that remedy, putting to an end the decades of injustice and uncertainty endured by hundreds of thousands of Equitable Life members.