CAMPAIGNERS have branded compensation payments to victims of the Equitable Life saga “pathetic”.

The pensions company collapsed just over a decade ago, leaving 6,000 Oxfordshire policy-holders and a further million pensioners across the UK losing life saving and drastic cuts.

This week, the Government announced compensation payments to victims would start by the end of June.

Oldest policyholders will get paid first. But some people will face waits of up to a year as compensations letters will be sent out over the next 12 months. Policyholders not due anything yet because of their age will not be contacted at all.

The compensation system has been heavily criticised by the Equitable Life Members Support Group (EMAG). They say the money is not enough and that it is “victimisation of old people”.

Chris Harlow, EMAG regional co-ordinator and lecturer at Oxford Brookes University, who lost money himself said: “The end is not in sight, except for five per cent of the victims. One million people are recognised as having lost money. Of those, only 35,000 are scheduled to receive compensation.

“Many have simply been scrubbed out, whilst others will get a pathetic 15 to 20 per cent of what they lost.”

The Treasury will offer £775m to around 945,000 policyholders. Another £620m will then be shared among 37,000 others.

The payments will be spread over five years, with £1bn paid by 2014.

Timothy Oates, 69, from Abingdon, lost his guaranteed annuity plan, despite paying into the scheme for 20 years.

The former helicopter pilot sergeant said: “I have been waiting for more than a decade to be compensated, and a pretty miserable compensation plan it is. They can’t even pay it out in a lump sum, which is pretty poor in my view.”

The Equitable Life Assurance Society was a 200-year-old insurance company which offered annuities and pension schemes. By the 1990s, the company was on verge of insolvency. But it continued to actively advertise for new customers until it collapsed in 2000.

The Government was criticised for the way it regulated the firm and allowed it to continue advertising.

Nicola Blackwood, MP for Oxford West and Abingdon, spearheaded the campaign to get compensation in Parliament last summer.

She was last night unavailable for comment.

Financial Secretary to the Treasury Mark Hoban said: “This is a complex issue, but the scheme has been designed to reflect the principles of fairness, transparency and simplicity.“When payments start will be a huge milestone for the policyholders who have waited so many years for the resolution of this matter.”

EQUITABLE LIFE TIMELINE

  • 1762: Equitable Life set up, making it the world’s oldest mutual insurer.
  • 1990s: The company is on the verge of insolvency, but regulators fail to prevent it from operating. The company continues to advertise for new customers.
  • 2000: Equitable Life effectively collapses due to its increasing debts.
  • 2001: The treasury commission The Penrose Report, published in 2004. It blames over-payments and regulatory system failures. It also accuses the former Equitable management team of “dubious” practices and nurturing a “culture of manipulation and concealment”.
  • 2008: Parliamentary Ombudsman Ann Abraham finds government regulators guilty of 10 counts of maladminitration. She recommends that victims are entitled to compensation.
  • 2009: The Government appoints retired judge Sir John Chadwick as an independent advisor to design an ex-gratia scheme for some policyholders. This is heavily criticised by the Equitable Life Members Support Group.
  • 2010: David Cameron pledges to send through an Equitable Life bill in the first session of Parliament.
  • July 2010: Government announces payouts will begin in mid-2011.
  • October 2010: Chancellor George Osborne announces that compensation of £1.5bn will be paid.