We have previously reported here and here on the long-running saga following the demise of Equitable Life. The latest chapter is the Equitable Life (Payments) Bill which received its first reading in the House of Commons on 22 July 2010. The Bill is intended to allow the Treasury to provide finance for payments to be made in cases where persons have been adversely affected by the Government’s maladministration in the regulation of Equitable Life Assurance Society (Equitable Life) in the period before 1 December 2001.
As previously reported here, the previous UK Government asked Sir John Chadwick, a former Court of Appeal Judge, to advise the Treasury on issues relating to the determination of relative losses suffered by Equitable Life policy holders and the impact of those losses. Sir John Chadwick issued his findings on 16 July 2010. Some of his findings are contentious; the Parliamentary Ombudsman herself having recently declared the proposals “unsound.” Because of this, and the complexity of the methodology Sir John Chadwick has advocated in his report, the current Government has stated that it will reflect on his report and will listen to representations by interested parties ahead of the Autumn Spending Review.
The purpose of the Bill therefore is to enable the new Government to make “fair and transparent payments to Equitable Life policy holders through an independent payment scheme for their relative loss as a consequence of regulatory failure” as pledged in the Coalition Agreement of 11 May 2010. The Bill itself does not set out any figures; its function is to allow the Treasury to authorise any future payments. The Bill will have its second reading on 14 September 2010.
The Parliamentary Ombudsman Report can be found here.
Sir John Chadwick’s report can be found here.
The Bill can be found here.