Dormant Bank and Building Society Accounts Bill [HL]

I congratulate the noble Baroness on the way in which she put her amendment and I absolutely appreciate the spirit in which she is moving it. I hope that we can give her some kind of answer to her specific examples, but if we cannot, we will go away and think carefully about what she said, because this is an important point. Whether she is right—which she undoubtedly thinks she is—or not, it is necessary that we do some more thinking about the accountancy points that she raises. Let me do my best. Her first amendment appears to be aimed at ensuring that any sums of money generated through the investment of reclaimed fund money, either by Big or by its agent under Clause 24 on investment provision, including interest repaid to Big under the terms of a loan, are available for distribution in addition to the money originally transferred from the reclaim fund. I hope that I can reassure the noble Baroness that these changes are not necessary to the drafting of the Bill as it stands. It goes without saying that we accept and agree with the spirit of her amendments and that the proceeds of any investment of unclaimed assets in the reclaim fund should be recycled back into money available for distribution. We believe that the Bill already delivers this by way of the definition of dormant accounts money in Clause 15—the very passage that she referred to. The principal from the reclaim fund plus the proceeds of that sum are invested either in Big or by its agent under the Clause 25 provision. The second amendment goes with the first. We do not think that the third amendment is necessary; it is concerned to ensure that where Big has loaned money and received the principal back with interest, all of the money goes back into the dormant account pot. That money is within the definition, too. The final amendment seeks to ensure that where Big has made a loan, rather than a grant, when the loan is repaid an amount equivalent to the original payment is recycled back into the spending area where the loan was originally made. We do not believe it is appropriate to set a requirement like this in the legislation. The detailed approach to distributing unclaimed assets is yet to be developed and we are obviously going to draw on a wide range of evidence in developing it to inform our directions to Big. We can conceive of a position where the relative weight of spending on the various priorities would change over time for wholly appropriate reasons, perhaps, because some priorities involve more concentrated up-front investment in facilities, while others relating more to the provision of services and advice are more ongoing in nature. Therefore, we would not want Big necessarily to be barred from recycling most of the receipts of a repaid loan that was made to support one purpose in the past to help meet the funding requirements of another priority, if that was more pressing at the time. We would not want to be tied down by the legislation to the approach which the noble Baroness put forward in her amendment. While distribution through loans may be appropriate in some circumstances, which is why it is in the Bill—the noble Lord, Lord Newby, and other noble Lords will be interested in social enterprises, for example, because they have indicated that they prefer that model of funding—we do not expect it to be our intention to direct Big as a general rule to make loans rather than grants. We would not expect it to be the predominant means of funding and large sums of money therefore to flow back into loans. We do not envisage Big investing other than to manage money not yet needed for distribution. Investment plus proceeds will be made available when needed for distribution. As far as grants made and repaid are concerned, money will go back into the general pot for the country for which the money is to be distributed. I assure the Committee that English money will stay in England. I am conscious that my answer has not dealt with the detailed points that the noble Baroness made, which is why I said at the outset that we would like to consider in more detail why she thinks that the present wording is unsatisfactory and whether we might come back with a form a words that is more in line, if not exactly in line, with her amendments. That can be usefully done between now and Report. We are trying to get to the same point; it is just a question of what wording is appropriate. I hope that the noble Baroness will forgive me if I leave my answer there.