Equitable Life (Payments) Bill

I pay tribute to the hon. Members who have spoken to the amendments. I praise our Treasury team, who have done a magnificent job of righting the wrong that was done to Equitable Life policyholders over many years. Opposition Members—there are some exceptions—should hang their heads in shame because of what they did when in government to Equitable Life policyholders. I came to the issue of the damage to policyholders rather late in the process—shortly before the general election. Like others, I was encouraged by my former employer to invest in Equitable Life, but it was a good job that I did not do so, or my view now might be different. I remind hon. Members about the pledge that we made before the election: 380 MPs agreed to press for proper compensation for victims by swift, simple, transparent and fair payment schemes, as recommended by the ombudsman; and we agreed that we would all join the all-party group on justice for Equitable Life policyholders. I agree with the pledge, which I signed, and I have honoured every element of it. A large number of colleagues have not joined the all-party group that I have the privilege of co-chairing, and I encourage them to do so even if latterly. I want to concentrate on three aspects of the amendments. The first is the moral duty that we owe to people who relied on advice and on the system of the regulator, the Government and Equitable Life. There was a major scandal, because those three bodies connived to swindle people out of their money. That is a sad indictment of what happened, and that is what set Equitable Life aside from all other aspects of the pension industry. We must demonstrate to people, especially young people, that it is worth investing in their future. If young people do not do so, there will be a sad and sorry state of affairs in this country. There is a clear moral duty. The second issue is the amount of money that is due in compensation. I am delighted that the Treasury accepted that the ombudsman's recommendation of £4.26 billion was the right amount to which policyholders were entitled. The debate today is not about money, but the Treasury team have come to a view that because of the economic circumstances only £1.5 billion is affordable. They have also had regard to the ombudsman's report, which said clearly that relative loss must be taken into account. The Treasury team must have done some calculations to reach the figure of £1.5 billion, and I trust that the Minister will tell us in his reply today how that figure was arrived at. The reduction from £4.26 billion to £1.5 billion is dramatic, and he must respond to our points.