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Equitable Life

Yes, Mr. Caton; I am very grateful to my hon. Friend the Member for Richmond Park (Susan Kramer). I declared earlier a tiny interest in respect of a small pension policy of my late wife. Why did people save with Equitable Life? It seemed the right place for people of a cautious disposition. It was a mutual. Its elegant notepaper claimed that it was the oldest mutual in the world. It was the choice for their own savings of many of the professionals who gave advice to others. It was a body that seemed the appropriate choice for people who simply wanted to make cautious and prudent provision for their retirement. I want to enunciate some principles. First, compensation is compensation, and should not be means-tested, which is the real implication of the statement by the Minister referred to so often today. Secondly, compensation is an essential discipline of the regulatory and governmental system. If no consequences follow from regulatory failure, either for the regulating body or the Government, there will be much more regulatory failure in the future. Just as the market has its disciplines, so must the regulatory system. No one is suggesting that what happened is all down to regulatory failure. The ombudsman has provided the Government with a basis on which to proceed to an assessment of how far regulatory failure affected the savings and stake of policyholders, compensating only for regulatory failure, and even taking account of the fiscal position. The ombudsman has done a very careful and responsible job. What is our position now? The credibility of the ombudsman system is at stake—that system that we recommend to people as a way of putting their case, which we take to the ombudsman on their behalf. With it the credibility of Ministers is at stake. It is not satisfactory to appear to be responding to ombudsman's recommendations, but not to carry them out, particularly when that affects those who have been so vividly described by hon. Members during the debate, whose vulnerability has been clearly set out, and who deserve a great deal better than they currently get.