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Equitable Life urges government to honour promise to pensioners

Directors ask Treasury to reverse coalition government's "disgraceful" renege on full compensation p

The board of insurance company Equitable Life will make a final appeal to the government today, to fully compensate pensioners and policy-holders whose payouts have been stuck after a scandal that took the company to the brink of bankruptcy.

The directors have sent a written request to Treasury minister Mark Hoban - who had indicated in July that a sum of £400m will be paid to pensioners - to honour the coalition government's earlier pledge of full compensation to 1.5m policy holders.

Equitable Life almost shut down in 2000 when it was faced with a lack of funds for payouts on pension policies taken from the 1950s to 1988.
Estimated losses to the pensioners were pegged at £4.8bn. But in July, former judge Sir John Chadwick stated in an official report that the government only needed to pay between £400-500m in compensation, even though the parliamentary ombudsman claimed there was 'serial regulatory failure' on the part of government agencies.

"The government should respect the parliamentary ombudsman's recommendations. It should dispose of the work of Sir John Chadwick, which we think is disgraceful. And they should pay proper compensation, not peanuts," said Equitable Members Action Group (EMAG) spokesperson Paul Weir.