Windfall claims too high, says Standard Life

Standard Life, the pensions and life assurance mutual, yesterday named 27 June as the date for policyholders to vote on its status, and immediately tried to undermine the case for conversion to a public limited company.

Scott Bell, Standard Life's managing director, said many of the group's 2.3 million members would not be entitled to up to £6,000 windfalls in the event of demutualisation, a key plank in the argument of Fred Woollard, the Monaco-based carpetbagger who forced the vote. Mr Bell said: "Actual windfalls would vary widely and, for the majority of members, be considerably less than the 'average' values quoted by those who wish the company to demutualise."

Standard Life claims that, using a typical distribution basis with a minimum payment of £250, about half its members would receive less than £2,500, with fewer than one in five receiving the quoted £6,000 or more, depending on the length and value of their policies.

Mr Woollard rejected the comments. He said: "They've really pushed the numbers to come up with that." He said the £12bn market valuation Standard Life assumed was "at the lowest possible end of the range". He added: "Even if you accept their numbers, which obviously we don't, it doesn't negate the basic benefit to shareholders. Most people would not say no to £2,500."

Mr Woollard seized on Standard Life's concern that his resolution, if passed, would "expose the board to management by referendum and undermine the ability of the directors to manage the affairs of the company in a responsible way for the benefit of all." Iain Lumsden, the insurer's finance director, said: "If Mr Woollard's proposals are accepted, any group of 50 members who wanted to suggest, say, that we sell our bank or pull out of Canada would be able to demand a referendum." Mr Woollard retorted: "Imagine what would happen if Tony Blair said he would prefer not to listen to the electorate?"

For the conversion to go ahead, Mr Woollard must win 75 per cent of the vote on 27 June.