Home Income Plans And The Failure Of Self-Regulation

EDM number 1343 in 1992-93, proposed by Alistair Darling on 08/02/1993.

That this House notes that up to 10,000 people may have lost substantial sums through purchase of home income plans in the late 1980s: notes that these products were sold mainly to elderly people who are especially vulnerable; regrets that the self-regulatory regime set up under the Financial Services Act 1986 failed to stop the sale of these unsuitable products or to insist that the sale was accompanied by a warning of the dangers of buying such a plan; further notes that it took two years before the sale of these products was stopped and longer to take action against some of those now in default; further notes that there have been substantial delays in processing claims by the investors' compensation scheme which is restrictive both in excluding some claims completely and calculating the amount of other claims; further notes that many of the victims will have to resort to rights under common law, which is both expensive and time-consuming; believes that the compensation schemes and the regulatory regime set up by the Government are not adequate and are in need of a complete overhaul and reform; and calls upon the Government to take immediate and appropriate action, both to help the victims of the sale of home income plans and put in place an effective regulatory regime.

This motion has been signed by a total of 102 MPs.