The Equitable Members’ Action Group has questioned the Government’s promises of fair compensation after reports that the Treasury may cut compensation levels to £1bn.
Emag points to the £4.67bn of losses for Equitable Life investors published by the Parliamentary Ombudsman in her 2008 report.
It fears the Treasury will use the work of Sir John Chadwick to justify a huge reduction in the amount of compensation.
In March, Emag withdrew from working with Chadwick’s review of compensation for policyholders, labelling his work “a Treasury stitch-up”.
Emag general secretary Paul Braithwaite says: “We are deeply disturbed by the gulf between the expectations raised by the Government’s promise and what appears to be actually going on at the Treasury. If the Government offers victims 20p in the pound, there will be outrage.”
In a letter sent to MPs, Emag argues that if cuts have to be made to Government spending now, it should be a percentage across the board and Equitable Life victims should not be first in line to shoulder the whole burden.