Turning up late to interview Labour MP Angela Eagle is not a good start. Blaming public transport and “severe weather warnings” is also inadvisable when you realise that she has worked with the Deputy Prime Minister's team at the Department of Transport on “getting London moving”.
But despite a somewhat frosty beginning, Eagle cuts to the chase and we are debating one of her favourite bugbears – life companies. She seems disappointed to have missed the dressing-down that Treasury select committee chairman John McFall dealt to the panel of chief executives from the UK's biggest life offices at a recent committee meeting. She is particularly interested in the responses that Legal & General head David Prosser gave to the committee.
She explains that she was unable to watch the life office bosses suffer because she was seeing Mr Blair over top-up fees – another subject she is particularly vocal on – as one of the core group of backbench rebels who relentlessly opposed fees. She is the daughter of a dressmaker and an artist and she attended the local comprehensive. It is hard to imagine even the most fearsome whip bringing Eagle into line on a subject she so whole-heartedly disapproves off.
She was a Labour whip from 1996 to 1997 and has been a member of the Labour Party since she was 17. She was a constituency party secretary in Peckham from 1989-91 and then in the 1992 general election defeated Baroness Chalker to be come the first-ever Labour MP for Wallasey in Liverpool, with a majority of 3,809. Eagle remained gracious in her maiden speech, describing the baroness as a “popular and well respected MP”.
Eagle is a tough adversary for the financial industry. Her recent tussle with ABI director general Mary Francis proved she is not prepared to take excuses from the big players and is intent on making those accountable admit any responsibility for misselling. She still seems flabbergasted over the rather heated exchange between the pair at the meeting. Eagle believes that the whole industry needs a rethink and should address its complacent attitude to its customers.
“It pays providers to have complicated, opaque products and the model is centred the whole time on distribution. This makes for a weak consumer and this pressure tends towards misallocation and misselling.”
She is a strong exponent of improving personal finance education in schools. “If you can't create a stronger consumer who is more informed, then we will end up obsessing about regulating sellers and increasing the cost of the products sold.”
As one of the Labour left, she has served on numerous standing committees dealing with trade union reform and employment rights and has taken a special interest in disabled workers' rights and the role of trade unions. She is also very actively involved with promoting women in politics.
Amid all this activity, you could make assumptions that Angela Eagle is married to her job. She spends a great deal of her time working in her constituency in Wallasey in Liverpool. She has a twin sister, Maria Eagle, who was elected as MP for Liverpool, Garston, at the 1997 general election and re-elected in 2001. They are the first twins to be elected as MPs.
Eagle advocates both Sandler's and Myners' analyses of the industry from macro-economic and micro-economic perspectives. She believes there has been a deliberately obtuse reading of the reports by the product providers. “I think there was a lot of opposition from the providers to their proposals but we have to look at the way that the industry has developed to judge the best way to change it.”
She does not think the FSA can become more proactive unless the commission process for advisers is changed. “The regulator spends its time dealing with the periphery. They are busy looking at the 10 per cent around the edge. I do not think the providers have read the proposals in terms of the potential incentives to create a more competitive, fairer market. We are just skimming the cream off the top here.”
Eagle believes there has been systematic misselling and considers it is wrong to say for the industry to say that everything has to be taken on an individual case-by-case approach.
Restructuring the financial services industry is no mean feat but that is her intention and she means to push the Treasury select committee to recommend this. She says the IFA sector should prepare itself for a radical change and believes there is an endemic problem of misselling that can only be removed by moving away from a commission-based selling process.
“What would I do about all this? I would want to restructure the salesforce. You could offer a suite of simplified products that are much easier to sell. You can get too obsessed with misselling and misbuying. Why is there so much opposition from providers? They are desperately worried that the Sandler range will be easier and will take off and they will no longer be able to rip off people. But I think they are backing down. They do not want to throw out their chances entirely.”
She says when we talk about IFAs you know it is a commission-based industry. She believes there is an inherent danger with products that last that as long as endowments and believes the industry could face a virtually infinite number of problems such as endowments while product designers continue to create more complex high-risk products.
“Whether we make a recommendation that the industry should be fee-based is horses for courses but I am attracted to the idea of not paying advisers up front. Commission-based performance-related payments are also a possibility. We do not want to get too over-elaborate. Three payment points to spread the commission over time could include some element of subsequent performance.”
Born: 1961 in Bridlington
Lives: In her Wallasey constituency
Education: Formby High School, St John's College, Oxford, BA Hons in Politics, Philosophy and Economics.
Career: Worked for Cohse (now part of Unison) as a researcher 1984, then press officer 1986, then Parliamentary liaison officer 1987. Elected to the party's national women's committee in1989. From 1989 to 1991 constituency party secretary for Peckham. Labour MP for Wallasey 1992. 1997 Parliamentary under secretary of state for the Department of Environment and Transport. Moved to the Department of Social Security in 1998 in the same role. Re-elected in 2001 general election, moved to Home Office in 2002 reshuffle but lost ministerial role in August 2002. She joined the Treasury select committee in February 2003.
Career and life ambitions: She is a founding member of New Wave Labour, a group launched with 14 MPs. Formed to shift the Labour Party to the left and “transform our society rather than accommodate the Thatcherite legacy”.
Likes: Chess, cricket and cinema. She is a member of the British Film Institute and writes regularly for The Tribune newspaper.
Dislikes: Long, tedious meetings and people who do not say what they mean.
Car: “I don't really care what I drive.”