Equitable Life Policyholders: Compensation

Ruth Cadbury Excerpts

Thursday 22nd October 2026 Westminster Hall

[Ruth Cadbury (Brentford and Isleworth) (Lab)]

It is a pleasure to serve under your chairmanship, Ms Furniss. I am grateful to my hon. Friend the Member for Leeds North East (Fabian Hamilton) for securing this debate. For 17 years, he has been limpet-like in this campaign for justice for Equitable Life victims, as have other Members of this House. It is a pleasure to follow the hon. Member for Strangford (Jim Shannon), who asked some very pertinent questions of the Minister, and I look forward to the Minister’s response.

I am sorry once again to have to stand up on behalf of my constituents who have faced a clear injustice over many years. I know at least four constituents who have been impacted, and it is likely that there are many more. I want to touch on a slightly wider theme: the injustice caused by what I can describe only as a series of financial scams and the weak response of successive Governments. This is not just about the Equitable Life scandal. Since I first entered this House in 2015, I have spoken up on the loan charge scandal, the Football Index scandal, the London Capital & Finance scandal, and now the Equitable Life scandal. The common theme of all those scandals is that the victims suffer financial hardship.

One constituent affected by the Equitable Life scandal was estimated to have had over £20,000 taken from him. “Taken” is the key word; it was not lost. That is what campaigners who were fleeced when Football Index collapsed made sure to tell me: “Use the word ‘taken’, not ‘lost’, Ruth.” A wallet is lost behind a sofa; money is taken from a wallet by a crook.

My constituent is not alone. Many people have had money taken from them as a result of this scandal. As other Members said, many are now much older. My constituent is in his 80s, and that is precisely the stage of life when people need money for social care, for their families or simply to enjoy their remaining life. It should be a time when people can relax, but they cannot. In too many cases over the past 30 years, the actions of private companies have led to constituents suffering.

During the Football Index scandal, one of my constituents had £10,000 taken. During the collapse of London Capital & Finance, a constituent had £120,000 taken. In both cases and that of Equitable Life, it is clear that the regulators, which exist to protect our constituents, failed to act.

Why does that matter? First, our constituents end up having money taken from them and their lives turned upside down. Secondly, the Government have to step in and provide financial compensation—taxpayers’ money—but it is too often inadequate and, as my hon. Friend the Member for Leeds North East said, some do not get any money at all. It is right that the Government provided compensation for my constituents and others who suffered as a result of this injustice, but we should not have got there in the first place.

The Equitable Life scandal is a reminder of what happens when regulators fail to act and private companies operate in an underhand manner and get away with it. Over the past decade, too many regulators have become hollowed out and either have failed to act at all or have acted too late. I feel somewhat nervous about even my own party in government talking about doing away with regulators. We sadly need regulators, because there will always be scammers.

It is the Government, taxpayers and ultimately the victims who end up picking up the tab when operators act against the honest aspirations of hard-working people. Far too often in these scandals, the private companies and directors get off scot-free. In many cases, they get to make more money and go on to fleece someone else.

The Equitable Members Action Group continues to campaign on behalf of those affected, and has argued that there needs to be greater transparency from the Treasury about the remaining money that has not been allocated to victims. I hope the Treasury can meet and engage with those campaigning on this injustice. I hope the debate serves as an opportunity for this House to remember the importance of having regulators that are able to act and to act swiftly.

--- Later in debate ---

[Richard Fuller (North Bedfordshire) (Con)]

It is a pleasure to serve under your chairmanship, Ms Furniss. We know that issues of injustice can take an awfully long time to reach a resolution in Parliament. It is important that people who have or feel that they have suffered an injustice at the hands of the state should have worthy champions who have the doggedness and stamina to continue to make their case, so I am delighted to congratulate the hon. Member for Leeds North East (Fabian Hamilton) on securing today’s debate.

As has been noted, the issue goes back through this Labour Government, previous Conservative Governments, the coalition Government, the Brown Government, all the way back to Blair. Let us take a moment to think about the individuals who have already been waiting two decades and more for what they would see is a full resolution. As a Member of Parliament myself for periods of that time, I have had a sense that this matter is unfinished business.

I was interested to listen to some of the comments. One issue that was raised, most notably by the hon. Member for Brentford and Isleworth (Ruth Cadbury) and my hon. Friend the Member for Christchurch (Sir Christopher Chope), was on regulation and the role of regulators. On the different perspectives and remedies, I think I am closer to the one suggested by my hon. Friend. The hon. Member for Brentford and Isleworth made the point that regulators are being hollowed out. I would say that on average they have greater scope, greater funding and more people. There is an issue with their focus, but more importantly, the structures to hold regulators to account are insufficient. There is no annual review of each regulator that is performed as effectively as in other areas, so I would encourage the hon. Member to press that point to improve our system of regulating the regulators.

[Ruth Cadbury]

I respect the shadow Minister’s views, but adequate powers and adequate resources go together. Too often since I have been in this place I have heard again and again that regulators would like to have done more and simply do not have the capacity. They do not have the staff in place. That is my view.

[Richard Fuller]

I do not want to go too far off the topic, because I am a bit of a nerd on regulating regulators. We can find time later to talk about that. It was an important point, as was the point made by the hon. Member for St Ives (Andrew George). I am glad he did not make a party political point, but it is a relevant point that the Labour party’s position in opposition was that the compensation was not sufficiently substantial.

I want to make three broad points in the lead-up to questions on each to the Minister. The first point I want to establish is that making changes to the settlement is not set in stone; it is a matter of Government choice. I want to give an example, which I raise solely for the purposes of talking about choice on pensions, not to talk about the decision that was made, because it is about choice. This is about mineworkers’ pensions. The incoming Labour Government made the choice in the case of the mineworkers’ pensions to move the surplus that had been accumulated in their fund to the mineworkers rather than back to the taxpayer—back to the Government. So it was a use of otherwise public funds that resulted in a boost to mineworkers’ pensions of about 30% to 32%. That was a choice.

I just ask the Minister to consider this. It was a choice by the Government to boost pensions that were already being paid “in full”, and yet the Government seem to have no choice about people who had an 80% decline in their pensions. It might strike some as odd, with a different set of values, to treat one differently from another. I would be interested in the Minister’s thoughts on that, but the point that I am trying to make is that this is a matter of choice for the Government.

My second point leads from a quote given by the Minister’s colleague, the Financial Secretary to the Treasury, who said on this matter in September 2026:

“There are no plans to reopen any decisions relating to the Payment Scheme or review”.

That is an interesting phrase, because part of the conditions around those decisions are couched in different wordings of the phrase—that the settlement amount was determined in consideration of the “position of public finances”. That was stated way back in 2008 and also when the settlement was announced in 2011. It was alluded to again in 2016. Given that the Minister’s colleague said there are no plans to reopen any decisions, can the Minister confirm that it is still the case that considering the state of the public finances is a live factor that is encapsulated in that?

What I mean by that question is, should there be a change in the public finances, would there then be scope for the Government to change their mind? That is an important point. I do not want to lay out a false hope, but the settlement amount was decided specifically in consideration of the public finances at the time. Times now may be better or worse, but they are certainly different. When we hear the Minister’s response or read the statement made by the Minister’s colleague saying that there are no plans to reopen any decisions, it is important that it is clear that they are still open to consideration if the public finances change.

I want finally to return to what the hon. Member for Leeds North East said in his excellent speech about unallocated and unspent moneys. He said that if funds have been allocated but are not needed to meet the liabilities for which they were intended, then they should be used to compensate people who have still not received full redress. That really is a question about what those unspent funds would do. That partly encompasses the reserve and partly encompasses unallocated moneys. In the big scheme of things, it would be very helpful if the Minister could confirm that it is the intention that those moneys in that envelope will be reallocated to policyholders, rather than being swept back into general taxpayer money.

The last thing we want to come out of this debate is the Minister being unclear with Equitable Life policyholders, who in some cases have lost 80% of their pensions already, or suggesting that if there are moneys left in the envelope, which was set at a particular level at a particular time because of the state of public finances, any surplus moneys will be squirrelled away and given to the Government again. I would be very grateful if the Minister could answer those three questions.