John Glen, Treasury minister, has pledged to review the laws governing mutuals because the future of LV hangs at the end.
Facing a grilling from Labour MP Gareth Thomas in Parliament, Glen said that he was ‘willing to engage’ on ‘further changes and reforms’ to help protect member-owned businesses.
These comments were made as the vote on controversial sale of LV by US private equity sharks Bain Capital reaches it’s climax.
Treasury minister John Glen (pictured) said he was ‘willing to engage’ on ‘further changes and reforms’ to help protect member-owned businesses
LV’s 1.2m members can cast their ballot through an online portal until 2pm today. You must have received postal ballots by the deadline. You will have another chance to vote online on Friday at 2pm or 4pm.
Campaigners, experts, and MPs have been furious at the proposed sale of the Liverpool-based life insurance. It was founded in 1843 as a way to assist the Liverpool poor with the burial of their deceased.
LV, as a mutual fund, is owned entirely by its customers. This means that it cannot be operated for cash-hungry investors to make a profit, but rather for the benefit of their customers.
But critics fear that, if more of Britain’s mutuals disappear into the jaws of private equity buyers, there will be fewer insurers and other financial services firms competing to offer low prices to customers.
Thomas, who heads the all-party parliamentary group on mutuals, said there had been ‘considerable public unease’ about the demutualisation of 178-year-old LV, formerly known as Liverpool Victoria.
He urged the Treasury minister to ‘consider sympathetically’ a letter which has been signed by more than 100 parliamentarians, raising concerns over the sale to Bain, and calling for a review into the law governing mutuals. Glen said LV’s future was now in members’ hands.
But the minister added: ‘In terms of the broader issue of how this sector is treated I remain willing to engage with [Thomas] on further changes and reforms that may help it in future.’
Since LV first announced its £530million sale to Bain last year, the firm has faced a backlash. The policyholders allege that they were not informed about the bidding details and the sudden necessity to close a deal.
Alan Cook, Mark Hartigan and other LV executives insist on the urgent need for new money to innovate and grow.
They have not agreed to discuss an alternate offer with their mutual Royal London counterparts. If the Bain sale proceeds, both Hartigan and Cook want to continue their roles as chief executive and chairman respectively of LV.
Hartigan might be especially benefited if Hartigan’s rewards package rises. He was paid £1.2million last year.
Let your voice be heard on LV
We are encouraging LV members, customers, or others, who would like to see it retain its mutual status, rather than be bought out by private equity, to write to it.
It is possible to use the words from the Daily Mail newspaper’s City Pages (pictured here).
You can find the text below and copy it into a new letter.
It can be sent to Alan Cook Chairman of LV= Liverpool Victoria, County Gates Bournemouth, BH12NF
Dear Alan Cook,
The undersigned urges you to reconsider the decision to sell LV=to Bain Capital, and instead to maintain its mutual status.