Treasury to vet Penrose report on Equitable

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The Independent Online

Lord Penrose, the Scottish judge presiding over an investigation into the demise of the venerated British mutual insurer, Equitable Life, delivered his long-awaited report to the Treasury yesterday.

A team of Treasury lawyers will now plough through the 818-page report, combing it for legal and commercial considerations that might be used to bar publication. The Treasury holds the ultimate power over what will see the light of day, which has caused fears that the report will be a whitewash of the role of Government in regulating the company.

Ruth Kelly, the Financial Secretary to the Treasury, said yesterday: "We are grateful to Lord Penrose and his team for all the work they have done in producing this report. The Treasury will now ... check for legal obstacles preventing publication. Subject to this review, the Treasury intends to publish the report and respond to it as soon as possible." This review is expected to take some weeks, but it could be published by February.

Lord Penrose began his investigation in August 2001 at the request of the Treasury, and was expected to complete his findings a year later. But his inquiry has been hampered by delays, caused by the mass of information collated and occasionally the reluctance of witnesses to give evidence.

The hopes of many thousands of policyholders rest on Lord Penrose's report, as the board of Equitable has said it will sue the Government for compensation if it finds sufficient evidence of negligence.

A spokesman for Equitable said: "We would like the report to be published in full as soon as possible. Only then can we determine what, if any, action the board can pursue for compensation." Equitable closed to new business in December 2000 after being forced to honour guarantees worth £1.5bn. Policyholders have since seen their fund values slashed and bonuses axed.