Examination of Witnesses (Questions 100-116)|
19 OCTOBER 2005
Q100 Kerry McCarthy: With National
Lottery prizes and so on there is a cut-off and you do not claim
after a certain time. Surely at least with these prizes there
should be a cut-off?
Mr Cook: There is no cut-off.
Whenever you find us, you get the money.
Q101 Kerry McCarthy: Do you not think
it would be a good idea to have a cut-off?
Mr Cook: No, because if I were
appearing before a committee like this, I think I would be yelled
at if I cut it off! The prize is there. The prize is owned by
the person that owns the Premium Bond. When that person steps
forward, we will give them the prize, and we will do everything
we can to identify those people and encourage them to step forward.
Meanwhile, the money remains there.
Q102 Kerry McCarthy: There must come
a point though when you accept that the prize-winner or the owner
of the account is not
Mr Cook: We are 142 years in and
we have not got to it yet!
Q103 Mr McFall: £1.8 billion
in dormant accountsthat is quite a sum. We read in the
papers estimates of £15-£20 billion in the whole country,
and yet you hold £2 billion. So that is important. If the
Treasury came to you tomorrow and said, "We are putting these
dormant accounts to charity", how much could you give the
Treasury in terms of what you have identified already, that is
ready and available? Because, from what I believe, the discussions
between the banks and the Treasury concentrate on, "Oh, well,
we can't really for sure say how much there is and what we can
give you, because of legal complexities". What could you
give, if the Chancellor came to you? What could you offer him?
Mr Cook: He has already got it.
This is the point. I have not got it!
Q104 Mr McFall: But the dormant accounts
are going to go to charity.
Mr Cook: Yes, but I have not got
Q105 Mr McFall: How much of that
money do you think could be given over to charity then? That is
the point I am making.
Mr Cook: It is not for me to decide
what could be given over to charity. The money
Q106 Mr McFall: You are the Chief
Mr Cook: Yes, you could try that
Q107 Mr McFall: Are you not responsible?
Mr Cook: I am a very responsible
man. You already know that. There is £25 million of unclaimed
prizes; £1.8 billion of dormant accounts. We have all that
money attached to persons that we cannot trace. At any time when
an individual steps forward and proves their identity, we can
give them the money. I just need to make sure
Q108 Susan Kramer: But if they are
140 years old . . . !
Mr Cook: Correct. Far be it for
me to decide which are the ones which will definitely never step
forward. The point to bear in mind is that this money lies in
the national debt. It has already been spent.
Chairman: It has been used. It is already
Q109 Mr Todd: You rather dismiss
the idea of a headline-grabbing statement about the maximum amount.
I think that is actually what you want to do, do you not? You
do wish to attract publicity to this subject.
Mr Cook: On dormant accounts?
Q110 Mr Todd: Yes.
Mr Cook: Oh, yes. This is freely
Q111 Mr Todd: Can I suggest that
if you cannot produce a headline-grabbing figure, to go away and
make one up?
Mr Cook: It was the size of the
prize. We issue press releases regularly. We usually find that
we can run it about once a quarter and the press will run with
Q112 Mr Todd: The good story is someone
who has come forward after 25 or 30 years and claimed one.
Mr Cook: And we have some case
studies. We do supply case studies to the press, with a photograph
of a happy couple, and all that sort of stuff.
Q113 Peter Viggers: £1.8 billion
would be worth something like £90 million a year in interest,
very roughly. Is that credited to your value added?
Mr Cook: That includes the interest.
This money continues to accrue interest, correct.
Q114 Mr Love: Last year, I think
it was, you mistakenly took £4 million from Premium Bond
holders. That money has all been paid back. However, what changes
have you introduced to ensure that sort of thing does not happen?
You have talked a great deal about the trust that your customers
have in you. Incidents of this nature, although they are small
amounts of money, do an enormous amount of damage. How do you
ensure that it does not happen again?
Mr Cook: First, just to say that
we took that situation extremely gravely. It was only a couple
of hundred cases out of 26 million, I know, but we took it extremely
seriously. The money was all credited back by CHAPS payment the
following day. Each one received a personal letter from my Operations
Director, and we sent them a voucher or whatever, and apologised.
The problem lay between us and various intermediaries in the banking
system, where a file was presented twice. So it was very clear
what the problem was, and additional checks have been put in to
make sure that that type of file could not be processed twice.
It is no good my saying, ". . . but it was outwith my control",
because it was my brand and my customers, and it is just no good
Q115 Mr Love: And they blame you.
Mr Cook: Yes, and they are right
to. We have studiously overreacted to that issue, to make sure
that that particular circumstance cannot happen again.
Q116 Chairman: We will leave it there,
Mr Cook. Can I thank you and Mr Bayley for coming this afternoon?
You have continually described it as a business, and I would commend
to you some of the points we made at the very beginning. I think
these accounts could be even clearerif I can put it like
thatin terms of showing the actual sales and the outturn,
maybe on a five-year basis. Perhaps you can consider that next
Mr Cook: A point well made.
Chairman: Thank you very much.