' EPHAG  apologise for the delay in publishing these notes, which has been caused by a technical problem with our web site server. This will be fixed as soon as we can, but in the meantime, we are grateful to Liz and ELM for their assistance in making them available. 

Copy of the main points discussed at the meeting between Lord Penrose and Hugh Burns of the Equitable Life Inquiry and Bob Widdess and Jack Denbin of EPHAG 
- held on 8th October 2002

Dear Mr Widdess,

Thank you for coming in with Jack Denbin to see Lord Penrose last week. Hannah Fitzgerald and I also attended. As promised, I am writing to set out, for the benefit of you and your members, some of the points that arose in the course of the meeting. However, I have not attempted to make it a full record of the discussion. You are welcome to circulate, or make available, the text of this letter to your members. I am sending you the text by e-mail. 


2. We are grateful for all the assistance we have already received from policyholders as a result of the appeal for documents which you kindly passed on to your members. The Inquiry has obtained a large body of documentary evidence from a variety of sources and has been heavily engaged in its analysis. The Inquiry is now about to commence taking statements from witnesses.


3. You suggested that it might be helpful if we could supply a schedule of gaps in the policyholder material we have; this could then be passed on to your members so that they could see whether the gaps could be filled from the material they hold. This is a possibility we had been considering and we will come back to you.

4. You asked about the possible impact on the Inquiry of litigation arising from the situation at Equitable, and particularly on the prospects and timetable for publication of Lord Penrose's report. We cannot rule out there being some impact on the progress or conduct of the Inquiry, for instance in terms of the readiness of witnesses to co-operate with the Inquiry. However, the scope of Lord Penrose's Inquiry is quite different to the scope of any litigation in train or which could be envisaged, and it is not his role to determine liability between parties. For these reasons Lord Penrose does not foresee that the timetable for the Inquiry would be determined in any way 
by the timetable of any litigation. 


5. Turning to the question of publication, I have explained why I think that some commentators may have read too much into the fact that neither the Inquiry nor HMT can give an absolute undertaking that the report will be published. For the benefit of your members, let me set out some of the salient points here, beginning with the position of the Inquiry. 

6. Publication is not part of Lord Penrose's remit, which is to report to Treasury Ministers. Indeed the Inquiry has no legal power to publish much of the material that might be included in the final report. Apart from normal duties of confidence arising under the common law, the Inquiry is bound by the statutory confidentiality regimes which apply to much or all of the material held by the regulators. Although implemented into domestic UK statute, the terms of these statutory regimes are themselves governed by the EU Life Insurance and Investment Services directives. Under these directives disclosure of confidential regulatory information is prohibited except to defined recipients and/or in defined circumstances (these exceptions to the general prohibition on disclosure are often referred to as 'gateways'). 


7. So, to provide the Inquiry with full access to the regulatory material, it was necessary to establish it in such a way as to ensure that there was a gateway from the regulatory bodies to the Inquiry. In part this was achieved by means of a statutory instrument. There is, however, no gateway under domestic or EU law that would enable the Inquiry to publish the confidential material it has access to. 


8. So any decision on publication is for the Treasury. I understand that Ruth Kelly, the Financial Secretary to the Treasury, has indicated a strong presumption in favour of publication, subject to restrictions of confidentiality. Clearly Ministers cannot go further than this at this stage because they will need to assess whether the whole report could or should be published once it has been submitted to them. In the meantime we are operating on the assumption that it is very likely that the report will be published.

9. You asked at the meeting whether there had been any interference from the Treasury in the conduct of the Inquiry. I assured you that there has been no interference, indeed that the Treasury had been scrupulous in avoiding the sort of conduct that might be thought to compromise the Inquiry. I repeat that assurance for the benefit of your members. 


10. Please contact me if you require any clarification or have further questions on the conduct of the Inquiry.

In addition, the following is taken from our notes made at  the time:

His Lordship confirmed that the Inquiry has no powers to force witnesses to attend. He did however indicate that the report would mention if anyone who was thought to have important information, refused to see Lord Penrose.

Lord Penrose also advised that his investigations to date had thrown up corrections to some previously widely held beliefs. One example was the understanding that there was an Inland Revenue requirement in the '80's that a GAR provision had to be built into Pension Policies at that time. His Lordship has discovered from his discussions with the Inland Revenue, and his search through their records that this was not the case.