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Equitable Life (Hitchin and Harpenden)

The Petition of residents of the constituency of Hitchin and Harpenden in the Hertfordshire region of the U.K. regarding the Government's response to the Parliamentary Ombudsman's reports on Equitable Life,

Declares that the Petitioners either are or they represent or support members, former members or personal representatives of deceased members of the Equitable Life Assurance Society who have suffered maladministration leading to injustice, as found by the Parliamentary Ombudsman in her report upon Equitable Life, ordered by the House of Commons to be printed on 16 July 2008 and bearing reference number HC 815; and further declares that the Petitioners or those whom they represent or support have suffered regulatory failure on the part of the public bodies responsible from the year 1992 onwards, but have not received compensation for the resulting losses and outrage.

The Petitioners therefore request that the House of Commons urges the Government to uphold the constitutional standing of the Parliamentary Ombudsman by complying with the findings and recommendations of her Report upon Equitable Life.

And the Petitioners remain, etc. -[Presented by Mr. Peter Lilley , Official Report, 7 December 2009, Vol. 502.]


Observations from the Chancellor of the Exchequer:

The Government responded to the Parliamentary Ombudsman's report into the prudential regulation of Equitable Life on 15 January 2009. The Government
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have the greatest respect for the Office of the Ombudsman. The Ombudsman's important role in the maintenance of standards of public service is unquestioned.

The Government are permitted, in certain circumstances, to reject the Ombudsman's findings and/or her recommendations for remedy. In this instance, where the Government departed from findings in her report, and her compensation recommendation, it did so only after very careful consideration.

The recent judgment in the judicial review of our response confirmed the legality of the Government's decision to reject the Ombudsman's compensation recommendation. With regard to her findings, the Court found in three instances that the Government had focussed too narrowly on the issue of regulatory compliance, and we have accepted those findings.

The Government must act in a way that balances the legitimate interests of the taxpayer with those of policyholders affected by events at Equitable Life. The Ombudsman herself recognised in her report that the public interest is a relevant consideration. What this means is that it is appropriate to consider the impact on the general taxpayer of any payments.

A further issue is that the Ombudsman was only able within her remit to consider the role of the regulator and not the role and responsibility of Equitable Life and other parties. The Government do not believe that the taxpayer should fund payments for any losses attributable to other factors, such as market conditions or the actions of Equitable Life itself.

The Government also explained in their response that they do not believe that it is generally appropriate to pay compensation where there is regulatory failure. The responsibility to minimise risks and to prevent problems occurring in a particular financial institution lies, first and foremost, with the people who own and run that institution.

Nevertheless, the Government recognise that some policyholders have been disproportionately affected by the events at Equitable Life. There are strong reasons to act quickly to help those hardest hit. We remain firmly committed to introducing a fair ex gratia payment scheme as soon as possible. The ex gratia payment scheme will be developed based upon consideration of Sir John Chadwick's advice and to take into account other relevant considerations such as the position of the public finances. Our goal is to introduce a scheme that is administratively quicker and simpler to deliver than that envisaged by the Ombudsman.

The Government expect Sir John to submit his final report in spring 2010. Once the Government has had an opportunity to consider Sir John's advice, details of the payment scheme that is fair to both taxpayers and policyholders will be announced.

Business, Innovation and Skills

Future of Small Shops

The Petition of members of the Federation of Small Businesses and others,

Declares that the House of Commons All-Party Small Shops Group estimates that there will be no independent retailers by 2015; declares that this equates to the loss of 50,000 small businesses; declares that the petitioners believe that small shops are struggling to survive because
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of local, regional and national Government policies, together with the failure of the competition authorities to deal with the aggressive policies of the supermarkets.

Further declares that the loss of the UK's Independent retailers has far-reaching socio-economic and environmental implications for the whole community; further declares that superstores and small independent shops should not be considered as two separate markets.

The Petitioners therefore request that the House of Commons urges the Government to take steps to secure the future of small shops across the UK and to safeguard the choice and competition that people expect on the market place; to create an independent regulator to ensure that local retail planning decisions do not have a negative effect on the interests of the local community; and to prohibit unfair pricing advantages such as below cost selling.

And the Petitioners remain, etc. -[Presented by Andrew Selous , Official Report, 25 November 2009; Vol. 501, c. 644 .]


Observations from the Secretary of State for Business, Innovation and Skills:

Small retailers are the lifeblood of our economy and play an important role in our local communities. Their survival will be crucial to both maintaining employment and economic activity through the downturn and providing growth as we move towards recovery.

Small retailers can access the same support and advice as any small business. The Government are continuing to improve and build on the delivery of services through the Business Link brand. Business Link provides the information, advice and support needed to start, maintain and grow a small business in today's competitive environment.

A number of the recent measures introduced to help SMEs form "Real Help for Business", a cross-Government brand of outward-facing products and initiatives to help businesses during these tough economic times.

In addition to providing immediate help directly to businesses, the Government's recent focus has been to ensure the banks have sufficient capital and liquidity, and then to ensure they use it to lend.

Going forward, within the context of "Building Britain's Future-New Industry, New Jobs", published by the Department for Business, Innovation and Skills in April 2009, we are developing new ideas to ensure that SMEs are able to grow when the upturn comes.

On 5 May 2009, the Government published a consultation draft Planning Policy Statement 4 (PPS4): Planning for Prosperous Economies. The proposals recognise the importance of achieving a broad range of retailer representation, both small and large, in improving the attractiveness of town centres and promoting competition and consumer choice. Draft PPS4 also requires local authorities to plan proactively for their town centres, and make provision for a range of new development, which will meet the needs of the community, and create opportunities for small and large retailers. Small shops can add character, diversity and enhance choice and we are asking local authorities to make full and effective use of the tools that are available to them.

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The consultation period on draft PPS4 ended on 28 July and we hope to publish the final policy before the end of the year.

On 14 April 2009 the government also launched the publication "Looking after our town centres". This guide is aimed at town centre managers and their local partners, and offers practical help in setting out how we can work together to make sure that our town centres reach their full potential.

The Competition Commission's 2008 investigation into the UK groceries market concluded the market was generally working well for consumers and competition was effective and delivered good outcomes for consumers. However action was needed to improve competition
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in local markets and to improve relationships between retailers and their suppliers, on which subject the Competition Commission made a number of recommendations to Government.

The Competition Commission's investigation looked at competition between convenience stores and large retailers and concluded that, although competition was intense, there was no evidence to suggest any distortions in competition.

The Competition Commission's investigation also looked at predatory (below cost selling) pricing and concluded it was not part of a predatory strategy aimed at convenience stores or specialist stores and was not having significant unintended effects on smaller stores.

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