The parliamentary ombudsman has just released a special report condemning the government’s “disappointing” response to the Equitable Life recommendations she put forard. You might recall these problems stem from Equitable Life offering guaranteed annuity rates to clients which they could ill afford to do.
Ann Abraham has criticised the government for them rejecting her findings of maladministration at Equitable and its decision to compensate only those who had been somehow ”disproportionately affected”. The report, entitled ‘Injustice unremedied: the government’s response to Equitable Life’, has just been laid before parliament. It follows Abraham’s first Equitable report in July of last year, and is only the fifth such “unremedied injustice” or special report ever produced by the parliamentary ombudsman since its creation back in 1967.
Abraham stated in her report that the government’s response to her findings was deeply disappointing. It didn’t provide sufficient support for the rejection of her findings of maladministration and injustice. Their response also begged a rather larger question as to what the purpose of regulation is actually supposed to be.
She added that there is no detailed timetable for this work to be carried out; the link between maladministration, injustice and the remedy to be provided to planholders has been broken; and there is no proper definition of the concept of “disproportionate impact” which is to govern clients eligibility for a payment.
Liberal Democrat spokesman Vince Cable and Tory MP Andrew Tyrie have tabled an early day motion to support the report, with the former commenting that the government has used every trick in the book to duck its responsibilities to Equitable’s policyholders. Adding that the ombudsman found evidence of both maladministration and injustice in the government’s overall regulation of Equitable Life, findings which ministers have rejected without basis.
Planholders should not have to wait any longer for recompense. Around 30,000 have already died waiting for something to happen. The government must accept the recommendations of the parliamentary ombudsman on compensating those individuals who have suffered loss.
Guaranteed annuity rates aren’t something you’ll find much of these days, and I think when you consider the Equitable Life fiasco you can begin to understand why. I wonder if their directors understood the costs when they offered them. I doubt it very much.
