Eight Tory MPs back bid to extend Equitable Life compensation scheme

By Jonathan Isaby

Before yesterday's debate on EU Economic Governance there was another minor Tory backbench rebellion during proceedings on the Equitable Life (Payments) Bill.

An amendment was proposed by Labour MP Fabian Hamilton which would have extended compensation payments to policyholders who took out annuities before September 1992.

The newly-elected Conservative MP for Harrow East, Bob Blackman, spoke in favour of the move::

"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."

"We have a problem, however, and amendment 1 attempts to address it. The amendment has cross-party support; we must be seen to be acting not just as a party but as parliamentarians overseeing the Executive. The problem is that if someone took out a policy on a particular day, they would receive no compensation at all, even though the maladministration was taking place at the time; whereas someone who took out a policy on the following day would get 100% compensation. There are always difficulties when arbitrary dates are set, but that is neither fair nor reasonable.

"I believe that we should set aside the date and review all the trapped annuitants to ensure that they get fair and proper compensation. The Chadwick report has been rubbished by EMAG, and by Members on both sides of the House, but even Chadwick proposed a scheme that would have compensated those trapped annuitants whose policies were taken out before the cut-off date."

When it was put to a vote, the amendment was defeated by 301 votes to 76, but eight Conservatives backed the amendment:

• John Baron
• Andrew Bingham
• Bob Blackman
• David Davis
• Mike Freer
• Richard Fuller
• Gordon Henderson
• Sarah Wollaston

All except Baron and Davis and members of the new intake and for Freer and Fuller, it was their first ever rebellious vote (outside of registering a view on a ten-minute rule bill).

Additionally, Craig Whittaker registered a positive abstention by voting in both the Aye and No lobbies.