Thursday, 15 January 2009

Two bad decisions in one day

Hot on the heels of announcing plans to expand Heathrow, the Government made a second statement about compensation for Equitable Life policyholders. The story here is that people took out policies with Equitable Life expecting that their money would be safe but because the company had over-extended itself (ie made very generous promises to some other policyholders) it ran out of money. Investors might reasonably have supposed that the powers-that-be would be keeping an eye on things, but apparently not...

After various investigations and reports, the Parliamentary Ombudsman produced a detailed report last Summer calling for extensive compensation for those who had lost out.

Today, the Government has come up with something much more limited - 'ex gratia payments' (ie discretionary, not as of right) to those who have suffered 'disproportionately' (ie many people may get nothing).

Whilst there's a lot of detail to look at, this looks to me totally inadequate. If you are going to have an independent Ombudsman to judge when there has been Government maladministration then you can't have the Government deciding that it wasn't guilty after all. This one will run and run.

PS I wonder why they put out two bad news stories on the same day....

3 comments:

Bibliophylax said...

Three if you count FOI...

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