New drive for compensation

EQUITABLE Life policyholders are launching a new drive to force the Government to pay out compensation.

MPs are being urged to take up the plight of the 750,000 policyholders in the House of Commons, while one leading action group has reiterated its vow to take the Government to court in Brussels.

Liz Kwantes, head of the E7 campaign body, said: 'Equitable was basically running amok for the last decade of the 20th Century. Penrose talks of a systematic failure in regulation, it's a damning report. Ruth Kelly said the Government won't pay any compensation but then again she said there would never be an inquiry, so we know she can change her mind.'

Equitable chief executive Charles Thomson reiterated that the mutual's board was prepared to sue the Government if its lawyers find enough 'bullets' in the evidence laid out by Penrose. But he called for Parliamentary Ombudsman Ann Abraham to reopen the investigation that cleared the Financial Services Authority of any failing last summer, and said this may be the best route for redress for savers.

Paul Weir, head of the Equitable Late Contributors Action Group, said it was wrong to pin all the blame on the Tories, given the thousands of savers who joined the mutual after Labour came into power.

'I put money in after the Financial Services Authority was set up in 2000 and they did nothing to warn me that I was putting money into a risky venture to fund other people's problems,' he said.