Equitable Life’s announcement is a bit of good news for some departing policyholders, it will not benefit the vast majority who are looking at losses of 85pc

Equitable Life’s announcement is a bit of good news for some departing policyholders, it will not benefit the vast majority who are looking at losses of 85pc – despite the compensation due to be paid by the Government.
In spite of collective losses in excess of £6bn, the Government is proposing to pay 945,000 victims of the Equitable Life scandal just 15pc of the amount they have actually lost.
This means that someone who has lost £50,000 from their pension pot may receive just £7,500 in compensation at some point between now and 2014. It is unclear whether any further interest will be paid to compensate for the delay.
The Government has already admitted that victims’ losses exceed £4bn, but the Equitable Members’ Action Group (Emag) reckons they are closer to £6.3bn when maladministration from 1991 and exit penalties are taken into account.
The £775m allocated for non with-profits annuitants means that victims can expect to get just 15pc of their losses. Emag will be renewing its campaign to press for full compensation by the end of this parliament. We know from our bulging postbag that our members are furious at what they see as a broken pledge from the coalition.