Connected Research

Union policy research in the 21st century

Posts Tagged ‘AVCs

High Court decides – partially – in favour of Equitable Life policyholders

leave a comment »

EMAG – the Equitable Members Action Group, which represents some 21,000 Equitable Life policy holders following the near-collapse of the firm in 2000 – is being reported to have won support from the High Court in its case against the government over the scale of the compensation scheme being offered to Equitable Life policy holders (the EMAG site has not yet been updated with the news).

Specifically, the High Court has ruled in EMAG’s favour on the issue of the valuation of the mainstream pension business between 1990 and 1996 which, EMAG believes, opens up the case for many more people to receive compensation – and, simulatenously, that their claims are therefore much bigger. Nevertheless, the High Court also ruled that it was for the government and parliament to decide what were the appropriate remedies for compensating policyholders. The government has previously commissioned a High Court judge – Sir John Chadwick – to investigate claims for limited compensation after 1999 against a criteria of individual hardship although campaigners consider this insufficient in the context of the report of Ann Abraham, the Parliamentary Ombudsman, which recommended a wider compensation scheme including eligibility criteria going back to 1990. The ruling does not appear to challenge the terms of reference for the Chadwick Review nor to allow ex gratia, rather than systematic, payments.

The government has 21 days to state what action it will take in respect of the ruling. EMAG’s legal costs (thought to be over £300,000) were awarded, but only to the value of 60% on the grounds that ‘The claimants were the substantial victors but a significant discount is appropriate’.

Vince Cable, Liberal Democratic party leader, will hold a parliamentary debate next Wednesday calling for Equitable Life policyholders to be compensated in full.

Advertisements

Written by Calvin

16/10/2009 at 11:41 am

Posted in Pensions

Tagged with ,

Equitable Life holders gain right to full hearing

leave a comment »

EMAG, the independent group representing Equitable Life policy holders, has won the right to a full hearing over what it claims as the government’s failure to offer full compensation after Equitable Life early collapsed in 2000.

In July 2008, Parliamentary Ombudsman Ann Abraham reported ten instances of maladministration from a range of government departments, some of which the government disputes, and called for a compensation scheme for more than a million policy holders suffering large cuts to the value of their pensions as Equitable Life struggled to stay solvent. The response of the government has been to offer limited, discretionary payments to some of those worst affected on a hardship basis and it has commissioned Sir John Chadwick, a former High Court judge to identify those who may be covered by these arrangements.

The case will examine what EMAG claims is the Treasury’s failure to act on the Ombudsman’s recommendations as well as its ‘continued intransigence’ in the matter. The main aim of its case is to challenge the ‘lack of cogent reasons’ for the Treasury’s refusal to accept some of the Ombudsman’s findings, but EMAG is also challenging the narrow remit given to Sir John.

Written by Calvin

27/05/2009 at 1:18 pm

Posted in Pensions

Tagged with ,