Speaking in a debate at Westminster, Mark Lazarowicz MP highlighted the need for compensation to Equitable Life members to be increased and greatly speeded up to reflect the reality that many of those who lost out as a result of the maladministration are now advanced in age.
Speaking after the debate, he said: “Under the current scheme, the vast majority of Equitable Life policyholders will only receive less than a quarter – 22.4p in the £ – of what they lost after investing in what was to all appearances a safe, well-established and regulated scheme: it was anything but.
“I want to see the compensation properly reflect what all policyholders lost and be speeded up: the Government should act in the upcoming Budget.
“These were people who tried to make provision for their retirement and they should receive compensation while they can benefit from it: many who lost out have already died before receiving anything at all.
“This highlights why it’s also such a concern that the Government is so behind schedule in providing advice to people on how to make use of the new freedom to take some or all of their pension pot early.”
Even though official estimates of the losses suffered by policyholders at Equitable Life put the total figure at £4.3 billion, the Chancellor allocated only £1.5 billion in October 2010.
That has to cover the cost of administering the scheme and the £620m for full compensation to be paid to the 37,000 holders of with-profits annuities leaving the rest to be shared out amongst the remaining 945,000 policy holders.
Mark Lazarowicz’ contribution to the debate can be found here.
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