MEPs label Equitable Life package “inadequate”

Members of European Parliament are refusing to accept the Government’s proposals to compensate victims of Equitable Life.

The MEPs have labelled the £1.5bn package on offer as “inadequate” at a meeting of the Parliament’s petitions committee.

The remarks were in response to an update to the committee from the Equitable Members Action Group, which said the compensation was insufficient and its allocation “makes no sense”. EMAG said its members feel “bitter and betrayed” at the package.

The MEPs spoke three years they completed their official report on Equitable in 2007.

UK Chancellor George Osborne announced compensation in the comprehensive spending review in October for those Equitable Life policyholders who may not have invested if it were not for regulatory failures. It later emerged the package excludes all pre-1992 annuitants.

EP committee of inquiry chair Mairead McGuinness said: “We as MEPs owe the policyholders a response to the UK Government’s proposals. We want fairness across Europe.”

Labour MEP Michael Cashman described the package as a “sorry and shabby business”, saying “no  political party in the UK comes out well”.

Liberal Democrats MEP Diana Wallis said the plight of Equitable victims could be contrasted with that of UK victims of the Icelandic bank collapse who “were immediately compensated”.

Centre-right German MEP Axel Voss insisted that compensation be paid out, and demanded the UK Ombudsman make public its views on the package.

Equitable Life collapsed in 2000 leaving over a million policyholders with sharp reductions in the value of their savings and pensions.