Equitable Life

Trapped Annuitants

supporting the With-Profit annuitants of Equitable Life



An Equitable Assessment of Rights and Wrongs

by Dr Michael Nassim


1.  Introduction

This article is an attempt to address the various factors that together determine how clients and members of the Equitable Life Assurance Society have been wronged, such that they have suffered or may yet incur loss or damage precipitated by the GAR (Guaranteed Annuity Rate) issue.  It is now clear that the GAR crisis was but one symptom of a deeper malaise.  Hence a prerequisite for the analytical assessment of wrongs is an effort to establish what that underlying malady was.  Though interesting, current analyses are too narrowly legal or financial, and so a wider perspective is now appropriate. Current analyses are also premature, because the Penrose Report should provide a more searching and definitive diagnosis than we have at present.  Even so, it may be wise to consider what the terms of reference for that opinion eventually might be. For if the Report fails to establish a consensus, or leaves room for significant residual dissatisfactions, we may need some pre-existing criteria to which we can refer if we are to contend that it has fallen short in any respect.  This objective is also important in view of the “unmasterly inactivity” on the part of Government over the ongoing pensions and savings crisis.  The recent failure of the Parliamentary Ombudsman to act responsibly is in this respect ominous; for details see the Equitable Members Action Group’s sharp response1. It may therefore be necessary to maintain the general momentum of inquiry should the findings of the Penrose Report be vetoed by the Treasury, delayed, not released in full, or otherwise watered down.  Even so, pre-existing criteria will not be helpful unless they are also realistic, or if there are no practical means of establishing them.  We shall return to this subject once the scope of this article has been defined, and the more significant items have been discussed.