Equitable Life

Part of the debate – in Westminster Hall at 10:12 am on 4th November 2003.

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Photo of Stephen O'Brien Stephen O'Brien Conservative, Eddisbury 10:12 am, 4th November 2003

Thank you, Mr. Stephenson.

In addition to my request to the Minister to do everything that she can to speed up the Penrose report, while recognising that maxwellisation is a genuine process that must be gone through, I want the Government to realise that they cannot have it both ways. If maxwellisation is taking place, we are going through a process whereby one of the restraints on future publication relating to confidentiality or potential prejudice is removed, because the process gives people the chance to comment. It must be clear that Lord Penrose has the liberty to make all the relevant findings that have been the subject of his inquiry and to adjudicate on them, notwithstanding the fact that he has said that he himself will not be finding fault. I urge the Minister to give a commitment once and for all. The maxwellisation process has engaged us in further delay, and the price of that delay, which has caused further misery for policyholders and annuitants, should be securing full publication of the report.

There is an important point about what might happen with regard to maxwellisation. There might be no finding of fault in the Penrose report—despite the fact that we will all pore over it, searching for findings and facts and seeing whether there has been any attempt to point the finger. We demand full publication, which should be coupled with an assurance that there will be no opportunity for a further protracted process. If the Government want to show that the Penrose inquiry is genuinely independent, they should accept that there is no need for a further process to determine and prove the independently gained facts of the case. If they have to be re-proved and the evidence marshalled again, and there is a move from Lord Penrose's investigative process to an adversarial court process, many policyholders and annuitants will rightly say that they are losing faith in the processes that the Government put in place and that the inquiry should have been put on a statutory basis from the very outset—as my hon. Friend the Member for Croydon, South mentioned.

Policyholders and annuitants will rightly want to be satisfied on a further point, which was somewhat ungraciously introduced in the intervention of the hon. Member for Reading, East. It might be said that the fault entirely lies with a previous Government. My hon. Friend the Member for Croydon, South answered that well by demonstrating that there has been a continuum. If Government as an institution—irrespective of which political party happens to hold power at any given time—are found to be at fault in their regulatory duties, subsequent Governments must step up and stand behind Government liabilities. That is one aspect of the nature of Government. Therefore, I can give a commitment that if a finding of regulatory fault or failure is laid at the door of one or more Departments, and if compensation therefore flows, an incoming Conservative Government would not seek to renege on that responsibility. The Government should make the commitment that, if the Treasury and the DTI are criticised, they will not necessarily seek simply to defend them, but they will acknowledge that this whole episode must be brought to a swift resolution. It is difficult to see how it can be resolved when, by any test, there is a need for compensation for people who have suffered an injustice.

I hope that the Government will carefully look at following the precedents of Barlow Clowes and other lifeboat operations. Sir Gordon Downey has brought weight and authority to this whole sorry process. He understood what happened during the 1974 banking crisis: that crisis was potentially even more serious than the Equitable Life saga facing us now, but a solution was found and mutual responsibility was accepted by Government and the private sector.

I look forward to hearing the Financial Secretary's remarks, and I hope that she will be able to give full answers to the questions that have been raised.