§ Mr. CohenTo ask the Chancellor of the Exchequer what discussions he has had with the Prudential over the disposal of its surplus funds; what sums are involved; and if he will make a statement. [58721]
§ Ms HewittThe Prudential announced in 1996 that it was opening discussions with DTI on the attribution of the inherited estate in its long-term business fund. These discussions are continuing with the Treasury, which took over responsibility for insurance regulation from DTI in January 1998. The total amount involved was estimated by an official of the Prudential when the company gave evidence to the Treasury Select Committee on 2 July 1998, to be between £6 billion and £8 billion.
It is the Treasury's policy not to comment publicly on discussions which it may have with companies in its regulatory capacity, in the interests of effective regulation and commercial confidentiality. But the Government's position on inherited estates was set out in a statement by the then Minister for Corporate Affairs in February 1995, 100W and reaffirmed by the then Economic Secretary in a reply to my hon. Friend the Member for Halton (Mr. Twigg) on 24 July 1998, Official Report, columns 750–52. The Treasury will deal with the Prudential's proposals, and any other proposals for attribution of the inherited estates of life offices, in accordance with the principles set out in those statements. The Treasury will place particular emphasis on protecting the interests of policyholders.