Fury as Treasury destroys Equitable Life compensation records

Victims of the Equitable Life scandal have seen their chances of justice collapse after HM Treasury admitted it has destroyed all records relating to compensation claims.

Policyholders and MPs have been campaigning for the Treasury to provide more compensation to victims. However, officials today told the Public Accounts Committee of MPs it had wiped records, despite promising not to do so.

Hundreds of thousands of campaigners who have said compensation has been insufficient, and had hoped to make an appeal, will now no longer to able to do so.

Bernard Jenkin, a Conservative MP, criticised the decision and said there was a risk it could appear as though the Government had “brushed it away for convenience”.

He added: “When people go back to look at these things and find all the papers and records have been destroyed it doesn’t strengthen public confidence, certainly when in the minds of many there is unfinished business.”

Sir Tom Scholar, of the Treasury, told the committee the data was only held to operate the payment scheme. "But once the scheme was closed there was no reason to continue holding the data," he added.

However, in January 2019, John Glen, MP and economic secretary to the Treasury, told Parliament records would be retained as long as it was legal to do so, with no plans to destroy them.

Today's evidence from Sir Tom suggested the records may have been destroyed prior to Mr Glen's statement.

Paul Weir, of the Equitable Members’ Action Group and claimed to still be £50,000 out of pocket, said he was “incensed". He called for a full investigation into the Treasury’s actions.

Mr Weir said: “ We have consistently written to check they have been keeping the records and they assured us they had.”

One million Equitable Life customers who held a pension with the failed insurance firm continue to be out of pocket two decades after its collapse. Victims recouped just 22pc of their losses, which total more than £4bn, in a compensation scheme that ran from 2010 to 2016.

Politicians and customers have repeatedly campaigned for more funds to be paid out after tens of thousands of pensioners were forced into retirement poverty. MPs launched a fresh call for justice this January and have called for £2.6bn in payouts for the almost 900,000 victims who continue to suffer.

Equitable Life was the world's oldest mutual insurer prior to its collapse. A black hole was revealed in its finances in 2000, with later inquiries revealing government failures had played a part in policyholders losing billions in retirement savings.

Bob Blackman, Conservative MP and leader of the Equitable Life parliamentary campaign group, said the lack of compensation received by victims has been a “gross injustice”.

He said: “The fact that Treasury officials destroyed data under the premise of GDPR clearly showed that an independent assessment of the full calculation methodology is needed. The Treasury has done nothing but twist the facts and try to cover its own backside.”

The existing “flawed” scheme for providing partial compensation is “fraught with errors” on payments, he added, while calling on the National Audit Office to undertake a review of the payments systems to ensure that the mistakes are corrected.

An estimated 15 Equitable Life policyholders die every day without receiving full compensation.

The Government has confirmed it will not reopen the compensation scheme and will not allocate any more money towards paying policyholders back.