South Basildon and East Thurrock MP. Stephen Metcalfe addressed the House of Commons to speak on the matter of Equitable Life.
“I will do my very best to keep my speech brief, Mr Deputy Speaker
It is an indication of the depth and strength of feeling that this scandal has created that so many Members wish to speak about it. There is no doubt that it is a scandal. Equitable Life behaved very badly. It hid its debts, it expanded too rapidly, and it had no visible means of support. Ultimately, those actions left my constituents and many other people throughout the country with reduced pensions, and with losses running into many thousands of pounds.
I think it fair to say that no one would have invested in Equitable Life had they known what was happening. The shame is that it has taken so long-nearly a decade-for us to reach a point at which we are actually going to do something about it. I welcome the Bill, I welcome the actions of the new coalition Government, I welcome the establishment of the independent commission that will report in January, and I welcome the stated aim to start making payments by the middle of next year. Those payments, however, must be fair as well as swift. I am glad that, after a decade of delay and prevarication, we are actually going to do something, and I think that all Members on both sides of the House agree that it is time to act.
Given that constituents have contacted me on this issue, I have obviously looked closely into it, and I must congratulate on all the work it has done in keeping the issue alive and at the forefront. I have spoken to its members and read its briefings, and I find myself in general agreement with its views. Like many other Members, I signed the EMAG pledge during the election, and I was happy to do so because I felt both that its members had a valid case for compensation and that that had been widely recognised. The real issue now boils down to money, therefore: how much compensation will be made available? Therein lies the problem, of course. We are doing the right thing here today, but we must continue to do the right thing.
I wish to make three points: first, we must be honest; secondly, we must be realistic; and thirdly, we must be compassionate. We must be honest about the level of losses Equitable Life members have suffered. We have had two reports, one from our own ombudsman-we have heard about the £4 billion or £5 billion identified in it-and one from Chadwick, estimating the sum owed at approximately one tenth of that amount. That is a 800 to 1,000% discrepancy. How is that possible? We heard from our own ombudsman earlier in the summer that she thought that was an unsafe and unsound basis on which to continue, and I agree.
In common with many Members, I campaigned during the election on a platform of honesty and realism. We must therefore be realistic and accept that we face extraordinary financial challenges, which were left to us by the previous Government, but we must not use that as an excuse not to do the right thing nor recognise what is the right thing to do. I agree with my hon. Friend the