Equitable Life

Debate between Stephen Lloyd and Greg Mulholland

Thursday 26th February 2015 Commons Chamber

[Greg Mulholland (Leeds North West) (LD)]

It is a pleasure to speak in the debate. I congratulate my hon. Friend the Member for Harrow East (Bob Blackman), my neighbour the hon. Member for Leeds North East (Fabian Hamilton) and my hon. Friend and colleague the Member for Eastbourne (Stephen Lloyd). I am proud to be a member of the all-party parliamentary group for justice for Equitable Life policyholders, which has shown how powerfully we can campaign when we do so collectively and collaboratively on a cross-party basis. I congratulate the co-chairs and officers for leading us in that endeavour.

I start by welcoming the progress that has been made. I remember the early meetings that took place towards the end of the last Parliament and the frustration that, at that stage, there was no compensation at all. We finally got the announcement of compensation, and I welcome the fact that payments surpassing £1 billion have now been made to 896,367 policyholders. That clearly represents great progress, but the clear message from the House today is that it is not enough. This debate itself shows that this is not the end of the matter, however convenient it might be for the Treasury—either side of the election—were that to be the case.

I strongly support the motion today and I shall carry on campaigning on behalf of my constituents as part of the group. About 40 of my constituents have raised this matter with me over the past few years, and many have told me of the hardship that they have experienced. Virtually none of them are wealthy people. They are people whose modest and very well planned retirement incomes have been drastically affected, and that has had a huge impact on their quality of life at a time when they should not have to face that and can do nothing about it. I pay tribute to all of them, and to the way in which they have campaigned as members of the Equitable Members Action Group. They include Ray and Marjorie Dunn, who have worked closely with me and played an important role in bringing people together. It has been a pleasure to work with them and all my constituents.

[Stephen Lloyd]

Would my hon. Friend also acknowledge the outstanding work that the members of the Equitable Members Action Group have done for us in Parliament? They have kept us informed and provided a secretary, and they have ensured that we pulled together on their behalf.

[Greg Mulholland]

My hon. Friend makes an important point. EMAG has done a wonderful job. Working together, inside and outside the House, has been an exemplary way of getting positive change.

One thing has not been raised in this debate so far and I am pleased to raise it strongly, as a member of the Public Administration Committee in this Parliament. One contributor today said it was disgraceful that neither the previous Government nor this Government had fully abided by the clear view or the will of the ombudsman, because they thought, “What’s the point?” I urge right hon. and hon. Members to look at the Public Administration Committee’s reports in this Parliament, because we are calling for a radical overhaul, part of which should be that Governments are bound by such decisions so we would never have this nonsense.

We have an absurd situation, because we are talking about the Parliamentary and Health Service Ombudsman, with the responsibility to Parliament. The Public Administration Committee has a view, as the Select Committee that oversees the ombudsman, and it wants a radical overhaul, The ombudsman’s office wants a radical overhaul, as does the ombudsman herself and the public, but we cannot have one because Parliament cannot reform its own ombudsman—only the Government can do so because it requires primary legislation. That is absurd and we need to find a way to enable Parliament to introduce legislation for matters that are parliamentary and not to do with the Government. I urge the Government in the Parliament—whoever is in government—to listen finally to that, to let go and allow Parliament to reform its own ombudsman in a way that is so clearly needed.

I am glad that this Government have come up with more than Sir John Chadwick proposed, which we all strongly said was not enough. I am also pleased with the campaign launched in October 2013 to find the 400,000 lost victims of the Equitable Life scandal. There are now approximately 142,000 policyholders who are due a payment but the scheme has not yet been able to trace or validate their address, so I hope that work will continue. This is taking too long, given that these people are in their retirement, need this money now and simply cannot wait. Tragically, some of them have died, and some will die without having had the chance to get that money they are clearly owed as a result of the maladministration and lack of regulation.

What is particularly galling is that there has been a double failure of regulation: the failure to regulate the banks properly led to the catastrophic collapse in the banking sector, which then led to vast amounts of money going to bail out those banks, and that is one reason there is not the money in the pot to compensate these people. That is a bitter pill to swallow, which is why there is no justification for not backing today’s motion and not coming forward, finally, after all these years, with the solution that is clearly the right and moral one.

Let me give an example to illustrate that point. After the giving of £620 million to 37,000 annuitants, 945,000 Equitable Life policyholders have shared the remaining £775 million, which of course is the 22% of their losses. Yet when we look at how much money has gone into the banking sector—we still have publicly owned banks—we see that there is a discrepancy that simply does not sit right and must be addressed.

We must finally draw this matter to a close. We must finally see a fair and final resolution. I share the passion of right hon. and hon. Members in not wanting to have to debate that; we must not be debating this issue at the end of the next Parliament. I hope we shall see some progress in the Budget. It is realistic to say that it will be some and not all—the latter would not be realistic—but it absolutely must be in the next Parliament. Let us now have a cross-party convention, let us take this out of the electioneering and have a genuine, firm policy commitment that the next Government will honour this pledge, as should have been done. It is an obligation on the British state, an obligation on this House and an obligation on this Government and the next one. It is an obligation that must finally be honoured.