Local Euro MP in call to UK Treasury to respond to the European Parliament's demand for compensation for Equitable Life sufferers and improved regulation

10.00.00am BST (GMT +0100) Tue 21st Aug 2007

Local Liberal Democrat Euro MP, Diana Wallis, along with the leading Equitable Life action group EMAG (Equitable Members' Action Group) is calling on the Chancellor of the Exchequer to respond to the European Parliament's recommendation to compensate the victims of the Equitable Life scandal, many from the Yorkshire and the Humber region.

Two months ago, the European Parliament adopted Diana Wallis MEP's Equitable Life report, which by an overwhelming vote of MEPs (605 in favour to just 11 against) called for compensation and regulatory changes. Thus far the Treasury has refused to comment, saying it is waiting for the much-delayed UK Parliamentary Ombudsman's Inquiry report, but that is not now expected to be published this year.

Diana Wallis MEP, along with Liberal Democrat Shadow Chancellor, Vince Cable, and members of the Equitable Members' Action Group, will later today, Tuesday, present a letter to the Chancellor of the Exchequer, Alistair Darling, calling for an immediate comprehensive response to the EQUI report. The letter also accuses the UK Government of 'breathtaking contempt' for the European Parliament.

Diana Wallis MEP, author of the Equitable Life report, said:

"I am very disappointed that the UK Government has so far chosen to ignore the substantial European Parliament report. This in stark contrast to the European Commission, which has reacted positively even to criticism and is preparing practical follow up measures.

"The UK Government has much to answer for to the victims of the Equitable collapse and it is shameful that it seems unable either to respond or act. We will not go away. The European Parliament will want to see clear answers to its findings."

Paul Braithwaite of the Equitable Life action group EMAG said:

"Today is a replay of six years ago when Vince Cable and I delivered a letter on behalf of Equitable sufferers to the then Chancellor, Gordon Brown. He has kept us on the back burner whilst immeasurable damage has been done to the reputations of the regulators and the financial service industry. Maybe just maybe, the new Chancellor will stop the shenanigans and act on the findings of the European Parliament's EQUI report."

EMAG points out that the Parliamentary Ombudsman brief has only minimal overlap with that of the EQUI report and claims the Parliamentary Ombudsman has no remit with regard to European Law or regulation of the single European market, which are the central subjects of the 47 recommendations made by the EQUI report.

Ends.

Letter to Rt. Hon Alistair Darling:

EMAG

42 Bartholomew Villas

Kentish Town

London NW5 2LL

21st August, 2007

Rt Hon Alistair Darling

Chancellor of the Exchequer

HM Treasury.

1, Horse Guards Road

London SW1A 2HQ

Dear Chancellor,

A response to EQUI is long overdue

This is written in the hope that your new ministerial lineup at the Treasury will bring a fresh approach to a problem that has festered to the detriment of the reputations of the UK regulators and the financial service industry alike for far too long.

Almost exactly six years ago, Dr Vince Cable and I hand delivered a letter to the then Chancellor about the plight of Equitable Life sufferers - just as we are doing this time. Today, we are joined by MEP Diana Wallis, the Rapporteur of the EQUI European Parliament's recent report into the regulation of Equitable Life.

The letter in 2001 contained the following:

"Time and again the series of regulators could and should have stepped in to protect policyholders. The regulators have failed policyholders and, along with management, they effectively concealed and condoned Equitable's increasingly parlous state……..Thus far, the Treasury has sought to distance itself from the Equitable. ………….There is no visible evidence that the FSA has been active on behalf of policyholders since closure despite, arguably, several circumstances in which it should have…………………. We maintain that by not acting the FSA has failed policyholders' "reasonable expectations"………. We should not wait for a post mortem - it's time for the Treasury to be proactive."

Plus ça change, plus c'est la même chose.

In the summer of 2004, frustrated and feeling that we were being denied justice in the UK, EMAG set about preparing a Petition to the EU Parliament. This was lodged in December 2004 and presented to the Petitions Committee the following September. The result was the setting up of a special committee of inquiry into the UK's regulation of Equitable for the period following the implimentation of the Third life Directive of 1993. The EQUI committee of 22 MEPs met 15 times and took evidence from dozens of witnesses, including representatives from the Treasury, the FSA and the GAD. The resulting 385-page report (Rapporteur Diana Wallis) was debated at length in the full Plenary of the EU Parliament on 19th June and then adopted by a quite extraordinary and crushing majority of 605 in favour, 11 against and 64 abstentions.You will be aware that the single market commissioner Charlie McCreevy, both accepted and supported the report's findings on behalf of the European Commission.

This report is highly critical of the UK Government. It has 47 recommendations, many of which were aimed directly at the UK. It is reasonable that the other 26 member states will look to the UK to show leadership in adopting these recommendations. Notwithstanding, in the last two months there has been not a peep of response from the UK Government, which shows breathtaking contempt for the European Parliament.

On the day of the EU debate a UK Government spokesperson was reported as saying that it would be inappropriate to comment until the Parliamentary Ombudsman has reported on Equitable. This is as disingenuous as it is unacceptable. The Treasury appears, thus far, to have found ways of causing three very major delays in publication of the PO report which the Government, thanks to the Treasury's filibuster response to Maxwellisation in April, must know is now very, very unlikely to report in 2007. This, despite the PO report having been instigated (in the face of submissions against by the Treasury and the FSA) more than three years ago and the report having been first presented verbally to The Treasury in January 2006.

Furthermore, the Ombudsman's report has minimal overlap with the EQUI report. The PO has absolutely no remit with regard to European Law and adoption of EU Directives, which is the primary focus of the recommendations made by EQUI. Indeed, the PO's investigation manager (Iain Ogilvie) gave evidence to the Brussels' Parliament explicitly to confirm this. Furthermore the PO cannot address the position of policyholders who were resident in other EU States such as Ireland and Germany.

EMAG, as representatives of present and past policyholders asks that you, as the new Chancellor, ensure a comprehensive response to the EQUI report and stop hiding behind the obfuscating excuse of waiting for the PO's report, when it is remit is totally different and it is certainly many months from publication.

The fact is that, year after year, large numbers of Equitable sufferers have died or are managing their retirement with less than they had been promised. A circumstance that arose because the series of UK regulators throughout the 1990s were asleep at the wheel.

EMAG hopes your Chancellorship will herald a new approach.

Yours sincerely,

Paul Braithwaite

For EMAG Ltd

paulbraithwaite@mac.com

cc Kitty Ussher MP