Equitable mauling for watchdogs

A SCOTTISH judge is poised to strike a blow for compensation for the victims of insurer Equitable Life.

Judge Penrose's report is expected to criticise the Department of Trade and Industry and other watchdogs who snored during Equitable's long slide from over-distribution to near collapse.

The report may be lodged with the Treasury as early as today. Had it been lodged earlier, a statement to Parliament might have been needed, but Parliament has shut down for Christmas.

It is not in Penrose's brief to recommend compensation but he is expected to take a dim view of regulators' performance over the years in which Equitable paid out big bonuses on the basis of reserves that proved inadequate.

One source said: 'The Government will come under significant pressure to write a big cheque'.

Treasury Economic Secretary Ruth Kelly is likely to release the report in late January. Controversial as it may be, it might then pale beside the Hutton report, due in mid-January.

Equitable said: 'We would like to see the report published in full as soon as possible.'

It is not surprising that Equitable chairman Vanni Treves is tempted to move to aerospace group BAE Systems. He is one of several people headhunted as possible chairman to succeed Sir Dick Evans. Treves has also been in the frame to take over ITV after the ousting of Michael Green.