Dormant Bank and Building Society Accounts Bill [HL]

Acting responsibly means operating within the framework under which the fund has been set up. What is the fund’s primary purpose? As we have made clear in the Bill, it is to set as its first objective the taking of steps to ensure that, as far as possible, accounts are reclaimed by their rightful owners. That is an important objective that will, as we have already indicated, be achieved by the extensive work of the banks and building societies in preparation for enactment of the legislation. It will be a function also of the reclaim fund. After that the question will be whether there had been an obvious misdirection of activity by the reclaim fund. If the fund, for example, put forward excessive costs to which the FSA drew attention, and if within those costs lay attempts to increase the remuneration of those working for the fund in a way not in keeping with the fund’s establishment, then the reclaim fund would have to recognise the authority of the FSA. But if effective action were not taken, then, as a last resort, the Treasury would act. I cannot think of that as more distant from how we expect the fund to operate within the framework of the objectives which will be set up for it. Subordinate legislation will be established to guarantee that it is governed by the Financial Services Authority. But if, in the most extreme case, the body acted completely contrary to the objectives that it is meant to fulfil in its articles of government, then the Treasury would act. It is a private body and therefore the Treasury would not act through direct enforcement; it would have to present the case against the fund. The reclaim fund is independent of government—it is a creation of the banks and the building societies—but there is a clear indication in the Bill of its objectives and how it should distribute resources. We will introduce secondary legislation to guarantee that the Financial Services Authority plays its proper part in the regulation of this body. Referral to the Treasury is a position of last resort in the relationship between the Treasury and that private body. I make that clear to the noble Baroness because she asked the question directly.