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Equitable Life

My right hon. Friend echoes an important point that was touched on by the ombudsman and raised in the Public Administration Committee report. There is almost a sense that the Government are using the ombudsman’s status as an investigator rather than a judicial authority to wheedle their way out of taking responsibility for these things. I want to return to a point that the Chief Secretary made on a couple of occasions when he said that there is a principle whereby the Government do not compensate for regulatory failure. If that were the case, the public bodies being investigated by the ombudsman would have been excluded by the Parliamentary Commissioner Act 1967, but they were not so excluded. That has led to the current position in which the ombudsman has the power to recommend that compensation should be given in cases of maladministration. Under the existing regulatory system, the Financial Services Authority is excluded from the ombudsman’s remit. However, the approach that the Government have developed to the ombudsman’s findings in this case was not raised in 2004, when the ombudsman sought a second investigation into Equitable Life, but emerged rather late in the day when the Government were trying to find a way to confound the ombudsman and confound policyholders’ fight for justice.