Almost a million people who lost their savings in the Equitable Life scandal will be paid compensation under plans detailed in the Queen’s Speech today.
Speaking at the House of Lords to unveil the plans of the new coalition Liberal-Conservative government, the Queen announced that Equitable Life members would receive ‘fair and transparent’ payments through the Equitable Life Payments Scheme Bill.
Better deal for consumers
The previous Labour government had apologised for the regulatory failure that caused the near collapse of the insurance company a decade ago, which saw its members lose almost half of their retirement savings when it could no longer afford to pay the guarantees on the annuities it had sold.
However, the compensation scheme it enacted was criticised for overlooking the findings of the Parliamentary Ombudsman Ann Abraham, and only compensating those who were worst hit by the Equitable Life debacle
New approach to compensation
Under Prime Minister David Cameron and Deputy Prime Minister Nick Clegg, the coalition government has said it will go further, following Abraham’s recommendations to ensure a fairer compensation process for Equitable Life members.
The new scheme will be headed by Mark Hoban, MP for Fareham and Financial Secretary to the Treasury.
More from the Queen’s Speech
We’ve got more coverage on today’s announcements, including news that:
- state pensions will rise in line with earnings from April 2011 as part of a new Pensions and Savings Bill;
- the new Energy Bill aims to improve energy efficiency and promote low carbon energy production;
- more powers will be given to the Bank of England to oversee regulation of the UK’s banking system.
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