Planning for the Future

Debate between Charles Walker and Damian Hinds

Tuesday 15th December 2020 Westminster Hall

[Damian Hinds]

The hon. Member raises important points. There is a need for housing of all different types, sizes and tenures, and there are different ways of delivering them. In the time we have available, I am afraid we are not going to get to the bottom of evaluating them in an ordinal way.

The third and important point I want to make is about national parks. I do not know whether there are others here who represent national park areas. There is the particular issue where part of a constituency is in a national park and parts are outside, so there are very different constraints in how land can be used. There is a danger that if a housing target or requirement is set based on the entire area, containing both national park and non-national park, with different constraints on what can be done in each part, the result will be the insufficient creation of new homes inside the national park and potentially too much on the edge.

A piece of work came out from Nationwide a few weeks ago that suggested that house prices in national parks have something like a 20% house price premium compared with those outside. In a constituency such as mine that is a huge amount of money. The Office for National Statistics is doing some further work, so hopefully we will be able to develop those figures. It is also important for the areas just outside the national park. In my constituency, that means areas such as Alton and Four Marks, where there is potentially a disproportionate amount of development in the border zone that can put considerable strain on infrastructure and provision of service. It can then be difficult to ensure adequate provision.

There has been a lot of debate about the proposals. Ministers have been in listening mode and have been very good in listening to colleagues across the House. I hope, as the matter develops further, it will be possible to take these considerations into account.

[Sir Charles Walker (in the Chair)]

You are all being very well behaved on timing, far too well behaved. I might have to lift the time limit.

Equitable Life

Debate between Charles Walker and Damian Hinds

Thursday 11th February 2016 Commons Chamber

[The Exchequer Secretary to the Treasury (Damian Hinds)]

This is an extremely important subject, and I congratulate my hon. Friend the Member for Harrow East (Bob Blackman) on securing the debate and bringing it to the Floor of the House today. His tireless work and that of other colleagues has been of great importance to many of our constituents. There are many human stories, and we have heard a number of them today from colleagues across the House. I am grateful to have the opportunity both to set out what this Government have done to address this long-standing issue and to set the record straight on some of the background.

Equitable Life has been a very sorry tale, and we all share sympathy for those affected by it. As the motion notes, this Government have taken action to resolve the long-standing issue, which is something that previous Governments failed to do, as noted by my hon. Friends the Members for Eddisbury (Antoinette Sandbach) and for North Devon (Peter Heaton-Jones).

Although Equitable Life remains a going concern and continues to trade, its problems in the 1990s and at the turn of the century caused a great many of its policyholders to suffer financial and emotional distress. Many different factors contributed to the losses suffered by policyholders. The ombudsman’s 2008 report established the part played by the then Government.

When we came to government, we committed to implement the ombudsman’s recommendation that the Government should make payments to Equitable Life policyholders in recognition of the part that was played by the Government at the time. We took swift action, introducing the Equitable Life (Payments) Bill in 2010, with payments starting to be made to policyholders in June 2011, six months after the Bill received Royal Assent.

[Mr Charles Walker]

My hon. Friend knows that the thrust of this afternoon’s debate is a request for additional money to be made available on top of the money that has already been earmarked for compensation to Equitable Life policyholders. Will the Government be able to find additional money?

[Damian Hinds]

I will have to disappoint my hon. Friend, because the public finances remain in a very difficult state. Although the economy and our public finances have improved compared with where they were, money is still extremely tight.

We established a set of rules for the payments, based on the Government’s full acceptance of the parliamentary ombudsman’s findings. The scheme was based on the assumption that all policyholders considered the incorrect regulatory returns when making their investment and would have decided not to invest in Equitable Life had those returns been correct. Obviously, those are quite conservative assumptions. The Government used the ombudsman’s findings to calculate the resulting individual loss by assessing the Equitable Life returns against those of comparator companies. That led to an assessment of the loss from Government maladministration of £4.1 billion.

Despite the constraints facing the public purse, the 2010 spending review announced that up to £1.5 billion would be made available for payment to eligible policyholders. Out of that sum, following consultation, we decided to pay the with-profits, or trapped, annuitants in full. As a result, this group of policyholders will receive an annual payment for life, and the actuarial assessment of those payments is that the Government will be making payments to this group well into the next decade and probably beyond.

The total cost of those payments is assessed to be around £625 million—though that is dependent on how long policyholders live. Importantly, the £100 million contingency fund, to which my hon. Friend the Member for Harrow East referred, is an accounting provision to provide a safety net in case the annuitants live longer than the central forecast. The remaining £775 million of available funding was distributed pro-rata to other policyholders on the advice of an independent commission, and that resulted in a figure of 22.4 pence in the pound of their relative loss.

Of course I know that that was deeply disappointing to many, but these were difficult decisions that were taken in the light of the position of the public finances. As I said just now in reply to my hon. Friend the Member for Broxbourne (Mr Walker), public finances remain in a very difficult position, and we have to take decisions in the interests of overall fairness to all taxpayers.