Equitable Life

Pamela Nash Excerpts

Thursday 26th February 2015 Commons Chamber

[Pamela Nash (Airdrie and Shotts) (Lab)]

I, too, congratulate the hon. Member for Harrow East (Bob Blackman) and my hon. Friend the Member for Leeds North East (Fabian Hamilton) on their work on this important issue and on securing the debate today. They outlined articulately the time line of the issues surrounding Equitable Life, and I do not intend to repeat any of that. More than 1 million people throughout the country have been affected by the issue, which dates back to the early 1990s. No Government between then and now have adequately dealt with the problems; they have been problems for successive Governments. However, the people who are affected do not care which party is in government; they simply want to be compensated and to feel supported by the Government of the day in getting the compensation and help that they deserve.

On Friday, I met two of my constituents who have been impacted by the maladministration of Equitable Life in quite different ways. The first was a gentleman who had cautiously saved for many years with Equitable Life. His hope, when he took out the policy, was to fund an early retirement at the age of 60. He is now approaching that age, but his hope has been dashed by the failure of Equitable Life. He managed to withdraw some of his money when the problems started to occur, but he has still suffered the loss of tens of thousands of pounds and he has been given to understand that he is entitled to no further compensation. The second was a lady in her 80s who had saved for decades but has been left with just a small fraction of her money in retirement.

These are not gullible people. The policyholders who got caught up in the Equitable Life disaster were hard-working taxpayers who played by the rules, worked hard and prudently and responsibly saved for their retirement. The lady I just mentioned had worked for a company that had to comply with financial services legislation, which only serves to fuel her incredulity at what has been allowed to happen. She retired 20 years ago, hoping that the policy she had taken out would fulfil its promise, but she was misled and mis-sold a policy that she had received with good industry-approved advice. She believed that she held a legitimate and lucrative policy. She, and many others like her, put their faith in the pensions system and planned for their retirement sensibly, only to find that the rug had been pulled from beneath their feet when they retired. These are not wealthy people; they are people who are being hit by the cost of living crisis that my other constituents are facing. They have lost life-changing sums of money and their standard of living has been devastated in many cases. Their own personal long-term economic plans have been shredded, through absolutely no fault of their own.

Some hon. Members have referred to the fact that locating the people who are eligible for compensation has been slow and inadequate. I believe that about 151,000 people still need to be found by the Government. What does the Minister plan to do to widen public knowledge of this issue in the near future? What publicity campaigns are planned to reach the most unreachable people, many of whom are pensioners without internet access? They would probably use the more traditional forms of media used for publicity campaigns. Also, I found it difficult when preparing for this debate to get figures telling me how many of my constituents might be affected. Will the Minister explain to the House why no figures are obtainable showing the regional breakdown of those affected by the collapse of Equitable Life’s payment scheme?

Time is against many of the policyholders. We have heard that many have sadly died. The Lib Dem manifesto promised to set up a

“transparent and fair payment scheme”

and the Conservative manifesto had a similar promise, but many policyholders feel that the current scheme does not fulfil those promises. Those affected by the maladministration of Equitable Life have been left in great financial difficulty despite planning and saving carefully for their retirement. This has had a serious impact on their quality of life. In my experience, those affected are just as angry with the Government as with Equitable Life. They are angry with successive Governments for not taking full responsibility for the failures identified at the time and for not adequately compensating those affected. One elderly constituent said to me, “They are waiting for us to die.” That is the appalling impression that that lady has been given, and I am sure that she is not alone.

I acknowledge that the present Government have made considerable progress towards compensating those who have suffered losses, but that comes nowhere near to fulfilling the promises of a fair payment scheme that appeared in the Conservative and Liberal Democrat manifestos. That is not just my view; I suspect that it is the view of the vast majority of the 1 million people who have been affected. I ask the Government not to leave this matter any longer and to address it in the upcoming Budget. I ask them to ensure that people are compensated so that they no longer feel that the Government are letting them down.