Select Committee on Treasury Minutes of Evidence


Examination of Witnesses (Questions 200 - 203)

TUESDAY 5 JUNE 2007

MS ANGELA KNIGHT CBE, MR PAUL CHISNALL, MR IAIN CORNISH AND MR ADRIAN COLES

  Q200  Chairman: In one of the exchanges I had with Grant Thornton, I said, if we have a voluntary scheme here, what financial incentive would there be for financial institutions to ensure that they get the maximum returns to remit? I got the answer: "Other than demonstrating good cooperative citizenship?", to which I said, "Yes." Then they came back, "Cynically, one of the things that I have to understand is why there is a benefit." Then another representative from Grant Thornton comes in and said, "Actually it would be inconsistent with the objectives of the institution to maximise shareholder, policyholder wealth." So there was a bias against it.

  Mr Chisnall: I do not believe that the comments that Grant Thornton made were made on the basis of experience of working with a UK institution.

  Q201  Chairman: You are not giving us any reassurance here on that particular issue, and that is a big issue for us.

  Ms Knight: Your concern being, Chairman, if I take you correctly, that there is not sufficient or equivalent effort given by each institution into reunification of the dormant account moneys or bank account moneys.

  Q202  Chairman: And also to prevent some institutions coming to the Committee in a few years' time saying, "Listen, we cooperated with this 100%. Look at the scallywags down the road. They did not bother." Why did they not bother? Because there was not sufficiently rigid legislation and codes in there to ensure that they bothered. So, we have to get this right to begin with.

  Ms Knight: I do understand. Actually I think it is going to be enormously difficult for anybody to duck out of this. This is actually an important issue. It is important to individuals. It is already getting a lot of publicity and that is good regardless less of whether A has launched a programme publicly and B has not. It is not about that. It is about the fact that this is knowledge of individuals who are seeing it, as I say, in a modest way on the websites. If I work my way through the steps that I could typically see happening (and I do take your point that you could well have, we could all well find ourselves in a situation where some are making greater efforts than others), then the consequence of that will simply be greater effort by ourselves through our contact arrangements, the Building Society Association through theirs, through complaints, if you like, initially to ombudsmen or Banking Codes. So I think that even if there is a differential start in how the various financial institutions address this, it certainly is not going to stay as a differential for very long because there are other checks and balances which pick it up, but if you have some greater concerns in this area, then I would say to you we certainly would be very interested to hear what the Committee would propose.

  Q203  Chairman: Angela, we will leave on the best of terms but we are totally unconvinced. Thank you for your appearance.

  Ms Knight: Chairman, if you are unconvinced could I leave you with this. We as the BBA representing our institutions are looking forward to your views and your ideas in this area. We have not got a closed book, we have not got a door shut against other ideas, we are certainly open to continuing this consultation, because we too think getting the money back to individuals is important.

  Chairman: Thank you.



 
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