Dormant Bank and Building Society Accounts Bill [HL]

I, too, agree with the noble Lord, Lord Newby, he will be pleased to hear, in that I do not think that it will be particularly helpful to the Committee to repeat arguments that have been employed on other amendments of this kind. However, it was the noble Lord who emphasised in debate on earlier amendments yesterday that this was to be a private sector company. The Government could have attempted to set up a public sector company or some sort of hybrid company, but this will be a private sector company set up by the organisations to which I have referred. The Bill seeks to set some sort of constraint around that company so that the public can be satisfied that it will be prudently run and that it will come under FSA rules and regulations. However, I do not consider fair the criticism that suggests that somehow the Government should know exactly what kind of company this will be—that is, whether it will be a company limited by guarantee or by shares. The point is that it will be a private sector company, and we hope that the terms of the Bill mean that it will act effectively to do the sort of things for which noble Lords, such as the noble Lord, Lord Shutt, have been arguing for many years. So, in my view, attacking the Government for not knowing every detail about how the company is to be set up is a good subject for debate but it does not really go to the heart of the matter. The heart of the matter is that we need to see the scheme set up. I take the point made by the noble Lord, Lord Higgins. The answer to it is that we, as the Government, want as light a touch as possible in this field. The building societies and banks have agreed that they will take part in a scheme such as this and we are delighted that they take that view. We want to work with them in order to ensure that the scheme works but we do not want the heavy hand of government to be present throughout the Bill. For parts of the scheme, it will be important to set out some guidelines, and those are ahead of us, but I do not think that it is a fair criticism to say, ““Well, at this stage the Government do not know how every part of this will work””. The heart of the question put to me by the noble Lord, Lord Higgins, with his vast experience, was: why do we need government legislation at all? Frankly, we need the legislation in order for banks to be able to cancel their liabilities to customers in the first place when they transfer their money. If we did not pass this legislation, there would be no way in which banks could cancel their liabilities to customers, and they would then keep those liabilities on their balance sheets while losing the assets. At heart, that is why we need the legislation.