Policyholders and public need to know the whole Equitable truth

Open hearings and full disclosure are the least we should expect of the Penrose inquiry - if the Treasury can take it, so can the people whose money was lost Small change Thank you to all readers who sent in e-mails to support last week's call for the Penrose inquiry into the Equitable Life debacle to be published in its entirety.

I was very touched by the response. When you write about these issues week after week, you sometimes wonder if you aren't getting lost down dark tunnels, with nobody following behind. But the quantity and quality of the notes you sent signalled that you strongly believe the inquiry into what went wrong at Equitable should be as open as possible.

Here is one of your comments: "Thank you for your article in the Sunday Herald. You are the only journalist who consistently writes with support, information and help for Equitable Life policyholders.

"Thank you for all you have done. I have previously contacted Alastair Darling regarding the situation. As an annuitant who cannot leave Equitable, I demand that the Penrose report be published in its entirety as soon as possible and that open hearings be granted now.

"This is the only means whereby people in my situation may ever get to the bottom of the debacle."

In fact I hope to speak to the Penrose inquiry in greater detail next week about the whole process of its investigations, and will report back fully. But how I understand its position at the moment is that it claims it is not for Lord Penrose to decide whether or not his findings will be made public, but the Treasury.

Similarly, he will not be attempting to apportion blame, merely to suggest lessons to be learned. But Lord Penrose can make recommendations on all kinds of things, and make his thoughts clear to those in political power.

It is also apparent from the e-mails that the public places a great deal of trust, confidence and hope in him, which they do not necessarily bestow on those in highest office. But then politicians, as the saying goes, are not so much bastards by birth as by vocation.

The mess at Equitable gets worse week by week. Those with income drawdown pensions met the company on Thursday in an attempt to make some progress on their mis-selling review.

This scandal predates the current fiasco, and the review was ordered by the watchdogs some years ago when evidence began to emerge that some people were persuaded to delay buying an annuity on retirement and invest their money with the troubled fund instead, taking an income. Many gave up the precious guaranteed annuity, because they didn't realise they had one and no-one told them they were surrendering a much superior product for one which was considerably riskier and made more money for the company.

These investors have been badly hit by the cutback in policy values and have lost substantial sums of money. Yet despite the time this review has been running, no progress has been made. There is a rectification scheme from which nothing has been paid out.

The Financial Services Authority cannot decide how compensation should be calculated. At Thursday's meeting Equitable Life apparently agreed that, in some cases, investors should be given all their money back. This is a surprising turnaround and not an offer on the table for any other groups of investors who have lost money. So don't hold your breath over that one.

Finally on Equitable, I have received a number of e-mails asking whether there is a members' action group in Scotland. There is not, but Wales has just set up its own body with help from Liz Kwantes, who runs the Equitable Life information website. She has given members a page and has acted as a co-ordinator for them.

She said she would happily do the same for any Scottish members who wished to form their own self-help group. She can be contacted at www.-equitablelifemembers.org.uk, or I will pass on any messages.

It was Adolf Hitler who reportedly said: "People will more easily fall victims to a big lie than a small one", and the whopper that stakeholder would solve Britain's pensions crisis was always as laughable as the idea that sleaze was abolished when Labour came to power.

Most people who invested in stakeholder, or indeed in the government's individual savings accounts, will have seen their savings wiped out over the past few years as stock markets slumped 40%.

Companies have lost a fortune on them at a time when the insurance industry is facing a solvency crisis, having itself been hit hard by tumbling share prices.

For once the industry tried to do the decent thing, with a few companies putting their backs into making it work for the government. Stakeholder was never going to work, except for those for whom it was like a gift from heaven: the super-rich, who were able to use it to pass cash on to future generations and avoid a whole raft of taxes, including inheritance tax and capital gains tax.

I will discuss these and other issues when I join Good Morning Scotland's financial presenter Waseem Zakir on Tuesday morning for BBC Radio Scotland's regular personal finance slot. If you have any matters you would like to raise with us, please e-mail me here on [email protected] or Waseem on [email protected].

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