Equitable Life scandal bill clears Lords hurdle

Published on 24/11/2010 19:24

Legislation paving the way for compensation to be paid to Equitable Life policyholders cleared Parliament last night.

Last month, the government announced that 1.5 million policyholders who lost money as a result of regulatory failure at the society would share 1.5 billion tax-free in redress.

The bill, which had already been approved by MPs, cleared the Lords last night without a vote and is now set to become law.

Lord McKenzie of Luton, for Labour, welcomed the general thrust of the government's approach to the issue.

He said: "This has been a long and arduous journey for those who lost out from regulator failure, and I fear for some the journey is not yet at an end, but the government are entitled to be given credit for the determined manner in which they have taken this forward."

Liberal Democrat Lord Kirkwood of Kirkhope, broadly welcoming the bill, told peers: "It is a complete and total tragedy from beginning to end. It has ruined the prospective retirement prospects for thousands and thousands of our citizens, and it must never be allowed to happen again."

Treasury minister Lord Sassoon, introducing the Equitable Life (Payments) Bill to the House of Lords, said: "The government does take the maladministration of Equitable Life very seriously.

"We have shown that resolving this issue is a real priority of the government and have taken the necessary action to reach a fair and swift resolution.

"I do fully sympathise with the plight of policyholders - people who have waited over a decade for justice. It is time we brought their suffering to an end."

Equitable Life closed to new business in 2000 after coming close to collapse. Parliamentary Ombudsman Ann Abraham found ten instances of maladministration by regulators and Whitehall officials in the period leading up to December 2001.