Dormant Bank and Building Society Accounts Bill [HL]

I am grateful to all Members of the Committee who have spoken, particularly to the noble Baroness, Lady Noakes, who I thought put the rejoinder to the noble Lord, Lord Newby, far more eloquently than I could. I therefore do not propose to embellish the main argument; the position she outlined is exactly the one that the Government adopt, and we do so for the excellent reasons that she put forward. However, there are issues of detail to which my noble friend Lady Pitkeathley drew attention and which I wish to emphasise. A voluntary approach enables the use of private sector expertise to manage and invest the money paid into the reclaimed fund by banks and building societies. It means that the private sector will take responsibility for managing liabilities to account holders, which will remain on the private sector’s balance sheet. If it is asked why they should do that and what is in it for it for them, as did the noble Lord, Lord Hamilton, we should explain that it will be a publicly explicit scheme. The public will know which banks sign up to the scheme and the extent to which they take part, so we do not have to worry about whether any of the major institutions will refrain from participating—very far from it. The basis of the agreement—or ““uneasy truce””, as the noble Baroness abstracted from the sense of the noble Lord, Lord Newby, but it is a little more than that—is a willing partnership to give effect to what the banks and building societies recognise is the unacceptability of money lying in accounts which according to their records they do not own. A careful, articulated approach will be taken to safeguarding the owners of those assets until we are clear that there are no claimants. We will also guarantee that claimants will get their money at any stage that they establish that they have a rightful claim, at whatever point of transfer the money has reached. That is all part of bank and building society goodwill and commitment. Therefore, the advantages of the voluntary approach are considerable. This approach also adds flexibility. Instead of going in with a heavy hand of state regulation, we can expect significant aspects of the scheme to operate on the basis of good practice. It also takes account of better regulation principles, building on existing regulatory arrangements, which will help us to maximise the money flows rather than detract from them. The great trouble with regulation, which requires the enforcement of law, is that one is compelling the unwilling, when what we expect within this framework is a light touch that will indicate how the willing meet their obligations. I emphasise again that the scheme will be wholly transparent, so there will be no question of significant institutions reneging on their public responsibilities or commitment to this scheme to which they have signed up in this agreement, on which all the proposals are based.