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Downey wants Govt to pay out on Equitable

Former Fimbra and PIA chairman and the first Parliamentary Commissioner for Standards Sir Gordon Downey says the Government should compensate Equitable policyholders for the DTI and Treasury&#39s regulatory failures.
He has also queried the independence of the Penrose inquiry amid anger that the probe will be held in secret.
The comments come as seven Equitable action groups calling themselves the E7, joined forces to demonstrate outside Parliament on Tuesday, accusing the Treasury of a cover-up, calling for £4bn Government compensation and a widened study by Parliamentary Ombudsman Ann Abraham. It coincided with the first anniversary of the creation of the Penrose and ombudsman inquiries. The demonstration was supported by MPs from all parties.
Conservative Party chairman Theresa May says she is concerned about the impact on people&#39s willingness to save. Tory MP Christopher Chope said the results of the inquiries could be embarrassing for the Government and expensive for the taxpayer.
Shadow paymaster general James Clappison has written to Treasury Financial Secretary Ruth Kelly seeking reassurance that the Treas-ury is co-operating with the Parliamentary Ombudsman.
Downey says: “Penrose is not the right direction. It was commissioned by the Treasury for the Treasury and about the Treasury. The main fault lies with regulation when the DTI and Treasury allowed Equitable to operate with inadequate reserves. Compensation should come from the Government.”
A Treasury spokesman says: “We and the FSA have always and will continue to co-operate fully with the Parliamentary Ombudsman and the Penrose inquiry.
“Taxpayer compensation would depend on Penrose&#39s report, which will be completed as soon as practicable. Those parts that can be published, will be.”

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