Field calls on bank to repay Farepak families

Nov 17 2006 By Kate Mansey Daily Post Staff

WIRRAL MP Frank Field yesterday called on bank executives involved in the Farepak collapse to pay families back the £30m they lost.

An estimated 150,000 families across the country will be left short this Christmas after paying in to the Farepak savings scheme to receive vouchers and hampers for the festive period.

But the Swindon-based company went into administration and ceased trading in October with no offer of compensation to its customers.

The Trade and Industry Department has launched an investigation into the Farepak collapse.

A fund has also been established to help the families affected, with HBOS promising to donate £2m.

But Mr Field, Labour member for Birkenhead, rejected the offer, saying the bank was not doing enough to help those who had lost out since the company's collapse. Yesterday, he tabled an early day motion in the House of Commons, calling on HBOS to repay the £30m it had recovered from Farepak and its parent company European Home Retail to refund savers in time for Christmas.

Mr Field said: "I tabled this early day motion to draw attention to the pivotal role HBOS has played in the collapse of Farepak, the Christmas savings scheme, whose bankruptcy blights the Christmas of half a million decent people, many of whom have been saving since January of this year.

"It notes that HBOS allowed Farepak to continue trading and to draw in savings averaging around £1m a week since January this year and also notes that HBOS has publicly stated that its total clawing back of funds from Farepak's parent company since the start of the 'savings year' amounts to £30m, and that this sum of money, together with that raised by voluntary contributions, comes within striking distance of the money owed to Farepak customers who have been carefully saving all year to offset the extra costs of Christmas.

"It further notes that in the last financial year HBOS reported a staggering record pre-tax profit of £4.8bn and calls on the bank to repay the £30m it has been able to recover from the wreckage into which half a million decent citizens have been plunged since the collapse of Farepak."