Andrew Mitchell
Main Page: Andrew Mitchell (Conservative - Sutton Coldfield)Department Debates - View all Andrew Mitchell's debates with the HM Treasury
(9 years, 2 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Bob Blackman
May I specify the types first, and then I will take interventions?
The first set of policyholders were those who took out their policies and had an annuity in place pre-1 September 1992. They were specifically excluded from the compensation scheme. I will come on to what happened to them subsequently. Secondly, there were the with-profits annuitants, who were given compensation of 100% of their relative loss—quite right too. Then there were the normal policyholders, who received an element of compensation. Unfortunately, when the legislation was set up, the public finances were in a scandalous state, and there was little money to allocate. I am delighted that the Treasury nevertheless chose to allocate sufficient funding to provide some £1.5 billion in compensation. There was £620 million to compensate the 37,000 with-profits annuitants, but, with the contingency fund of £100 million that was put in place, plus the costs of administering the scheme, that left only some £775 million to be spread between the 945,000 other policyholders, who therefore got only 22.4% of the compensation that they were due. As a result, those individuals have not been put back into the position that they should have been in had they not suffered the relative loss.
Mr Mitchell
My hon. Friend is making an extremely good and most important speech. I agree that the coalition Government deserve considerable credit for having tackled this early on in their term in office. Since, sadly, I cannot be here for the Minister’s speech, will my hon. Friend pursue the issue of the speed at which these payments are being made? Many of my constituents have had to wait a considerable length of time. I would be most grateful for his and the Minister’s reassurance that everything is being done to make these payments as rapidly as possible.
Bob Blackman
It is fair to say that the all-party group and EMAG have been on the backs of the Treasury Ministers responsible. The current Minister is in her place. Her predecessor, my right hon. Friend the Member for Bromsgrove (Sajid Javid), was very helpful in making sure that the scheme was speeded up and that people got the compensation due to them. Most importantly, he decided that he would not close the scheme, which could have been done under the legislation, until we had traced every one of the policyholders due for compensation.