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The Actuary The magazine of the Institute & Faculty of Actuaries

Equitable - Here we go again

It’s two steps forward, one step back again for the Equitable saga, as the High Court has ruled that the government’s rejection of the Parliamentary Ombudsman’s recommendations ‘lacked cogency’. The Treasury has 21 days to respond and say what it will do now, in place of the very limited compensation arrangements announced at the beginning of the year, overseen by Sir John Chadwick.

One specific decision of the High Court was to backdate from the date that compensation emanates to 1991, which will potentially bring in both more policyholders for compensation and larger sums to be considered.

Watch this space, but do not hold your breath for a quick denouement. The judicial review was brought by the Equitable Members Action Group (Emag). It challenged the refusal of the government to accept all the findings of the Ombudsman’s report into the role of government departments in the Equitable Life collapse, published last year.

The Ombudsman, Ann Abraham, found 10 examples of maladministration, which she said had contributed to the losses suffered by Equitable pension savers after the society was forced to close in 2000.

Paul Braithwaite of Emag said: “If Emag’s members had not paid for this legal action, there’s little doubt that, despite the Parliamentary Ombudsman’s recommendations for compensation, the government would have got away with limiting payments to a small number of Equitable’s victims for losses post-1999”.