Equitable members welcome compensation hope

More than one million policyholders who lost money in Equitable Life received hope from the new coalition Government today over compensation payments.

The coalition agreement stated that it would implement the Parliamentary Ombudsman's recommendations to "make fair and transparent payments" to people who suffered through the collapse of the mutual.

It said an "independent payment scheme" would be set up to make payments for policyholders' "relative loss as a consequence of regulatory failure".

The Parliamentary Ombudsman had called for policyholders to be paid redress after finding 10 instances of maladministration by regulators and Whitehall officials in relation to Equitable in the period leading up to December 2001.

But the then-Labour government rejected many of her findings and said it would make ex-gratia payments to people who had been "disproportionately affected" by the problems at the society.

Equitable policyholders are currently awaiting the publication of a report by former Appeal Court judge Sir John Chadwick, who was advising the former government on the level of compensation that should be paid to members of the society.

Alistair Dunbar, of the Equitable, said: "This does look very positive.

"We look forward to working with the new government to help them to deliver a payment scheme that is swift, simple, transparent, fair and seen-to-be fair. Our policyholders have been waiting long enough."