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I am pleased with the direction of travel of the Bill. We are talking about large sums of money being taken from dormant bank accounts and being given to good causes, so it is important that once we establish the body overseeing that transfer of money, it is not out of sight and out of mind. We need to get it set up, and then be able to feel that we have done our job effectively and so move on. I am extremely pleased that in three years’ time we will revisit its performance when we can talk to the various parties involved in its operation to divvy up the cash. The banks and building societies will have their view, and some who have voluntarily signed up will have suggestions on how arrangements can be
made even better. It will also give us the opportunity to talk to those who had not signed up to ask how we could persuade them to do so, without cajoling them with the threat of binding legislation. We can also talk to those who have been reunited with their money about their experience. There will be a good opportunity to sit down in three years’ time to establish whether the mechanism we are putting in place today is working and delivering efficiently and effectively.
I hope that new clause 2 will get a further hearing because, if we decide not to have further three-yearly reviews of the performance of the body in Parliament, it is important that there is a debate in Parliament when it can come to a settled view that it is happy with the direction of travel after three years and that it needs to have no further involvement. I prefer our new clause 2 to Government new clause 3 and, while there is no place for partisanship in this debate, I suggest humbly to my hon. Friend the Member for Fareham (Mr. Hoban) that if he does not like new clause 3, in three years’ time, he might be in a position—as a Minister—to change it and ensure that we have such debates regularly.
Rob Marris: I shall cover three points: Treasury discretion, factors covered by any review, and those consulted. Although this is not a fantastically well-attended debate, and I was not on the Committee that examined the Bill, it is an extremely important matter because we are, as several hon. Members have said, talking about taking people’s money. Parliament must be extremely careful when passing any such legislation.
I have given my opinion of Treasury discretion in interventions on the hon. Member for Taunton (Mr. Browne), who kindly accepted them. I do not believe that new clause 2(2), which begins, “From time to time” makes any difference—it is simply a statement of principle.
Mr. Martyn Jones (Clwyd, South) (Lab): I am sorry to interrupt my hon. Friend’s flow, but, as he did not serve on the Committee, perhaps he may be under a misapprehension. People’s money will not be taken—the money will always be there. People who lose contact with their funds will always have access to them—that is one of my reasons for pressing for the measure for the past 10 years. People can get their money. We are talking about using the money that cannot be given back to people for good causes rather than for profits for the banks.
Rob Marris: I stand corrected on the nuances—the measure would not take people’s money for ever more. However, it provides for taking people’s money, and they would have to go through a procedure to get it back if they resurfaced after, for example, 20 years.
On Treasury discretion, new clauses 3 and 2 are effectively no different. I prefer new clause 3 because of the factors that it covers. On the review, new clause 3(2) contrasts with new clause 2(4). The subject matter that would be reviewed under Government new clause 3 is rather greater and more intensive than that envisaged under the Opposition’s new clause 2.
Similarly, when one contrasts new clause 3(3) with new clause 2(6), the consultation process envisaged in new clause 3 is rather better than that in new clause 2.
For those reasons, if new clause 3 is pushed to a Division, I will support the Government.
Ian Pearson: We have had an interesting debate, which shows that there is not a great deal of difference about substance between all hon. Members who contributed. We all believe that a review is necessary, and most of the debate has centred around whether more than one review should take place and whether provision for that should be made in the Bill.
The Government’s position is that a comprehensive review in three years is sufficient to establish whether the scheme is operating effectively and that further requirements for reviews constitute a heavy-handed approach. I understand the view of the hon. Member for Fareham (Mr. Hoban), who speaks for the Opposition, that new clause 2 specifies further reviews “From time to time”; the wording is fairly loose, as we have discussed. I also appreciate that new clause 2 includes a power to remove subsequent reviews through the affirmative resolution procedure. However, we do not believe that we need that amount of stricture. If the review demanded further consideration by Government, it could—and would—be conducted in the way that my hon. Friends the Members for Coventry, South (Mr. Cunningham) and for High Peak (Tom Levitt) clearly outlined. If a review revealed that we needed to review the scheme still further because sufficient concerns remained, we would do that. Not putting something in statute does not mean that it will not happen.
Mr. Hoban: May I draw the Economic Secretary’s attention to a parallel? The Financial Services and Markets Act 2000 included a power to conduct a formal review of the FSA and the Financial Ombudsman Service in two years of their being established. That measure does not rule out further reviews, but only one review of FOS and the FSA has taken place. It is all very well Ministers saying, “Oh yes, we could have another review”, but, without a legislative requirement, the necessity for keeping the scheme under consideration will soon slip out of the Treasury’s mind. That is why new clause 2 requires further reviews, but also includes the power to remove the requirement, if appropriate. New clause 2 would force the Government to keep the matter on their agenda, whereas new clause 3 would allow it to drop off quickly, after the first review.
Ian Pearson: Let me assure the House that we would commit to keeping the issue very much on the Government’s agenda, but that would also depend on what the first review concluded. If the first review concluded that the scheme was working well—that there was extensive voluntary participation, that the reclaim fund was operating efficiently and that money was going to the Big Lottery Fund and being spent in exactly the right way—it might also conclude that no further action was necessary other than to keep a watching brief. To commit ourselves to hold a review “from time to time” would not be a good legislative route to pursue.
I should like to pick up some of the points that hon. Members have made. My hon. Friend the Member for Wolverhampton, South-West (Rob Marris) made the point in his speech and in response to an intervention by my hon. Friend the Member for Clwyd, South (Mr. Jones) that we are talking about customers’ money. A great deal of time and effort has already been spent on reuniting customers with their money. My hon. Friend the Member for Wolverhampton, South-West talked about the procedures that people will need to go
through to reclaim their dormant account money, so I ought to explain that doing so should be very simple. It should require no more than taking two forms of identification to one’s bank or building society and saying, “I’d forgotten that I had this money in my account. This is me—please give me the money.” All the wiring that will support subsequent claims on the reclaim fund to reimburse the bank or building society will not be seen by the customer, who will just have to undergo a simple transactional exercise, just as people go their bank or building society and withdraw money that is rightfully theirs.
My right hon. Friend the Member for Leicester, East (Keith Vaz) made two important points. First, he asked whether there would be an independent element in the review and noted that the clause as drafted requires that the Treasury carry it out. As we have made clear, the review will be undertaken in consultation with industry, consumer groups and the voluntary sector. We see the process as a consensual one. We do not specify in the Bill whether a Treasury official would carry out the review or whether we want to commission independent consultants to do it, but that is a decision that we would want to make at a later stage.
Keith Vaz: I am most grateful to the Minister, but I hope that he will not have consultants conducting the review. He has put a jolly good new clause before the House and presented a brilliant Bill. Let us not spoil it by bringing in the consultants. If he wants to bring someone in, he should choose some great, towering figure from business or wherever—I do not know what Lord Digby Jones is doing these days—who will have a proper, independent look. Please, please do not go to consultants.
Ian Pearson: I take my right hon. Friend’s point. My point is that there will be extensive involvement and consultation as part of the review process. Whether the review team will be made up purely of Treasury officials or whether we want an independent person in charge, whoever they might be, is something that we can consider later, when drawing up the review.
My right hon. Friend also discussed the liquidation of BCCI. I stand to be corrected, but my understanding is that accounts from the former BCCI are not likely to be transferred into the reclaim fund or meet the requirement of dormancy, as defined in the Bill as drafted. Should that not be the case, however, I will endeavour to come back to him. However, the principle is that the scheme is voluntary and the reclaim fund is a private sector organisation. There is discretion on the part of the participating banks and building societies to interpret whether such accounts are dormant. That is one of the flexibilities in the system, which we believe to be one of its strengths.
4.30 pm
Mr. Hoban: The right hon. Member for Leicester, East (Keith Vaz) raised an important issue. Is the Minister saying, in effect, that the liquidator would be able to choose whether the remaining assets, in this case in BCCI, would be available for transfer to the reclaim fund? The liquidator’s duty to maximise the amount available for creditors would seem to suggest that doing so would be wrong and that any moneys remaining in dormant accounts should stay within BCCI and form part of a dividend to be distributed to creditors.
Ian Pearson: My understanding is that the latter would obtain. There is also the issue of what would happen if money was transferred into the scheme and a bank subsequently became insolvent. In those circumstances, I think that the customer would still be able to reclaim their money, and that would be the right thing to do.
Keith Vaz: The Minister said that the customer would be able to reclaim the money. Would they reclaim it from the liquidator, or would it go back to the insolvent bank first? I think that that was the point that the hon. Member for Fareham (Mr. Hoban) was making.
Ian Pearson: If the money has already been transferred to the reclaim fund, even in an insolvency situation, and if a customer is—
Keith Vaz: Would the Minister prefer to write to me about this?
Ian Pearson: Let me try to explain it first. If it is still unclear to my right hon. Friend, I will endeavour to write to him. The key principle is that dormant accounts are transferred to a reclaim fund, then transferred on to the Big Lottery for distribution to worthy causes. If, at any time, a customer with a dormant account should realise that their account is dormant and want to get their money, they can go back to the bank or building society. That procedure would pertain in a normal situation, but I would suggest that it would also pertain in an insolvency. The customer would have the same rights as any other retail depositor in an insolvency. If I need to make any further clarification on that, I will ask leave of the House to do so.
In conclusion, I do not think that there is a great deal of difference between new clauses 2 and 3. The principal difference is the question whether there should be a review from time to time, or whether there should be just one review, followed by the Government making a commitment that, if we felt further reviews were necessary, we would endeavour to ensure that they took place. I hope that the hon. Member for Fareham will not feel that he needs to press new clause 2 to a vote, but if he does, I will invite my hon. Friends and other hon. Members to oppose it, and to support the Government’s new clause 3.
Question put, That the clause be read a Second time:—
The House divided: Ayes 236, Noes 185.
AYES
Abbott, Ms Diane
Ainger, Nick
Ainsworth, rh Mr. Bob
Alexander, rh Mr. Douglas
Allen, Mr. Graham
Anderson, Janet
Armstrong, rh Hilary
Atkins, Charlotte
Austin, Mr. Ian
Austin, John
Bailey, Mr. Adrian
Baird, Vera
Barlow, Ms Celia
Barron, rh Mr. Kevin
Bayley, Hugh
Beckett, rh Margaret
Benn, rh Hilary
Berry, Roger
Betts, Mr. Clive
Blackman, Liz
Blears, rh Hazel
Blizzard, Mr. Bob
Blunkett, rh Mr. David
Brennan, Kevin
Brown, Lyn
Brown, rh Mr. Nicholas
Bryant, Chris
Buck, Ms Karen
Burden, Richard
Butler, Ms Dawn
Byers, rh Mr. Stephen
Byrne, rh Mr. Liam
Cairns, David
Campbell, Mr. Alan
Campbell, Mr. Ronnie
Cawsey, Mr. Ian
Clapham, Mr. Michael
Clark, Paul
Clelland, Mr. David
Coaker, Mr. Vernon
Coffey, Ann
Cook, Frank
Cooper, Rosie
Cooper, rh Yvette
Corbyn, Jeremy
Cousins, Jim
Crausby, Mr. David
Creagh, Mary
Cruddas, Jon
Cryer, Mrs. Ann
Cummings, John
Cunningham, Mr. Jim
Cunningham, Tony
Curtis-Thomas, Mrs. Claire
Darling, rh Mr. Alistair
David, Mr. Wayne
Davies, Mr. Dai
Davies, Mr. Quentin
Dean, Mrs. Janet
Denham, rh Mr. John
Dismore, Mr. Andrew
Donohoe, Mr. Brian H.
Dowd, Jim
Drew, Mr. David
Eagle, Angela
Eagle, Maria
Efford, Clive
Engel, Natascha
Ennis, Jeff
Etherington, Bill
Fisher, Mark
Fitzpatrick, Jim
Flello, Mr. Robert
Flynn, Paul
Foster, Mr. Michael (Worcester)
Gapes, Mike
Gardiner, Barry
Gerrard, Mr. Neil
Gibson, Dr. Ian
Gilroy, Linda
Godsiff, Mr. Roger
Goodman, Helen
Griffith, Nia
Grogan, Mr. John
Gwynne, Andrew
Hain, rh Mr. Peter
Hall, Mr. Mike
Hall, Patrick
Hamilton, Mr. Fabian
Hanson, rh Mr. David
Harman, rh Ms Harriet
Havard, Mr. Dai
Healey, John
Hepburn, Mr. Stephen
Heppell, Mr. John
Hesford, Stephen
Heyes, David
Hill, rh Keith
Hillier, Meg
Hoey, Kate
Hoon, rh Mr. Geoffrey
Hutton, rh Mr. John
Iddon, Dr. Brian
Illsley, Mr. Eric
Ingram, rh Mr. Adam
Irranca-Davies, Huw
Jackson, Glenda
James, Mrs. Siân C.
Jenkins, Mr. Brian
Johnson, rh Alan
Jones, Helen
Jones, Mr. Kevan
Jones, Mr. Martyn
Joyce, Mr. Eric
Kaufman, rh Sir Gerald
Keeble, Ms Sally
Keen, Alan
Keen, Ann
Kelly, rh Ruth
Kemp, Mr. Fraser
Khan, Mr. Sadiq
Kidney, Mr. David
Kumar, Dr. Ashok
Ladyman, Dr. Stephen
Lammy, Mr. David
Laxton, Mr. Bob
Lepper, David
Levitt, Tom
Lewis, Mr. Ivan
Linton, Martin
Lloyd, Tony
Love, Mr. Andrew
Lucas, Ian
Mackinlay, Andrew
Mactaggart, Fiona
Mahmood, Mr. Khalid
Malik, Mr. Shahid
Mallaber, Judy
Mann, John
Marris, Rob
Marsden, Mr. Gordon
Martlew, Mr. Eric
McAvoy, rh Mr. Thomas
McCabe, Steve
McCafferty, Chris
McCarthy-Fry, Sarah
McCartney, rh Mr. Ian
McDonagh, Siobhain
McFall, rh John
McIsaac, Shona
McKechin, Ann
McNulty, rh Mr. Tony
Meale, Mr. Alan
Michael, rh Alun
Miller, Andrew
Mitchell, Mr. Austin
Moffat, Anne
Mole, Chris
Moon, Mrs. Madeleine
Morley, rh Mr. Elliot
Mudie, Mr. George
Mullin, Mr. Chris
Munn, Meg
Murphy, Mr. Denis
Murphy, rh Mr. Paul
Naysmith, Dr. Doug
Norris, Dan
O'Brien, Mr. Mike
Olner, Mr. Bill
Osborne, Sandra
Owen, Albert
Palmer, Dr. Nick
Pearson, Ian
Plaskitt, Mr. James
Pope, Mr. Greg
Pound, Stephen
Prentice, Bridget
Prescott, rh Mr. John
Primarolo, rh Dawn
Prosser, Gwyn
Purnell, rh James
Rammell, Bill
Raynsford, rh Mr. Nick
Reed, Mr. Andy
Riordan, Mrs. Linda
Robertson, John
Robinson, Mr. Geoffrey
Ruane, Chris
Ruddock, Joan
Russell, Christine
Ryan, rh Joan
Salter, Martin
Seabeck, Alison
Sharma, Mr. Virendra
Shaw, Jonathan
Sheerman, Mr. Barry
Sheridan, Jim
Simon, Mr. Siôn
Singh, Mr. Marsha
Skinner, Mr. Dennis
Slaughter, Mr. Andy
Smith, rh Mr. Andrew
Smith, Ms Angela C. (Sheffield, Hillsborough)
Smith, Angela E. (Basildon)
Snelgrove, Anne
Southworth, Helen
Spellar, rh Mr. John
Starkey, Dr. Phyllis
Straw, rh Mr. Jack
Stuart, Ms Gisela
Sutcliffe, Mr. Gerry
Tami, Mark
Taylor, David
Thomas, Mr. Gareth
Thornberry, Emily
Tipping, Paddy
Todd, Mr. Mark
Touhig, rh Mr. Don
Trickett, Jon
Truswell, Mr. Paul
Turner, Mr. Neil
Twigg, Derek
Ussher, Kitty
Vaz, rh Keith
Vis, Dr. Rudi
Ward, Claire
Wareing, Mr. Robert N.
Williams, rh Mr. Alan
Williams, Mrs. Betty
Wills, Mr. Michael
Wilson, Phil
Winnick, Mr. David
Winterton, rh Ms Rosie
Woolas, Mr. Phil
Wright, Dr. Tony
Wyatt, Derek
Tellers for the Ayes:
Mr. Dave Watts and
Ms Diana R. Johnson
NOES
Afriyie, Adam
Ainsworth, Mr. Peter
Alexander, Danny
Amess, Mr. David
Arbuthnot, rh Mr. James
Baron, Mr. John
Bellingham, Mr. Henry
Benyon, Mr. Richard
Bercow, John
Beresford, Sir Paul
Binley, Mr. Brian
Blunt, Mr. Crispin
Bone, Mr. Peter
Boswell, Mr. Tim
Bottomley, Peter
Brady, Mr. Graham
Brazier, Mr. Julian
Breed, Mr. Colin
Brokenshire, James
Brooke, Annette
Browne, Mr. Jeremy
Bruce, rh Malcolm
Burns, Mr. Simon
Burrowes, Mr. David
Butterfill, Sir John
Cable, Dr. Vincent
Cameron, rh Mr. David
Carswell, Mr. Douglas
Chope, Mr. Christopher
Clappison, Mr. James
Clark, Greg
Clarke, rh Mr. Kenneth
Clegg, rh Mr. Nick
Clifton-Brown, Mr. Geoffrey
Cormack, Sir Patrick
Cox, Mr. Geoffrey
Crabb, Mr. Stephen
Curry, rh Mr. David
Davey, Mr. Edward
Davies, David T.C. (Monmouth)
Davies, Philip
Davis, rh David
Djanogly, Mr. Jonathan
Dorries, Mrs. Nadine
Duncan Smith, rh Mr. Iain
Dunne, Mr. Philip
Ellwood, Mr. Tobias
Fabricant, Michael
Fallon, Mr. Michael
Foster, Mr. Don
Fox, Dr. Liam
Francois, Mr. Mark
Fraser, Christopher
Gale, Mr. Roger
Gauke, Mr. David
Gibb, Mr. Nick
Gillan, Mrs. Cheryl
Goldsworthy, Julia
Goodman, Mr. Paul
Gove, Michael
Gray, Mr. James
Grayling, Chris
Green, Damian
Greening, Justine
Greenway, Mr. John
Grieve, Mr. Dominic
Hammond, Mr. Philip
Hammond, Stephen
Hands, Mr. Greg
Harper, Mr. Mark
Harris, Dr. Evan
Harvey, Nick
Heathcoat-Amory, rh Mr. David
Hemming, John
Hendry, Charles
Herbert, Nick
Hoban, Mr. Mark
Hogg, rh Mr. Douglas
Hollobone, Mr. Philip
Holloway, Mr. Adam
Holmes, Paul
Horam, Mr. John
Howarth, David
Howarth, Mr. Gerald
Hughes, Simon
Huhne, Chris
Hurd, Mr. Nick
Jackson, Mr. Stewart
Jenkin, Mr. Bernard
Jones, Mr. David
Key, Robert
Kirkbride, Miss Julie
Kramer, Susan
Laing, Mrs. Eleanor
Lait, Mrs. Jacqui
Lamb, Norman
Lansley, Mr. Andrew
Leech, Mr. John
Leigh, Mr. Edward
Letwin, rh Mr. Oliver
Lewis, Dr. Julian
Liddell-Grainger, Mr. Ian
Lidington, Mr. David
Lilley, rh Mr. Peter
Llwyd, Mr. Elfyn
Loughton, Tim
Luff, Peter
Mackay, rh Mr. Andrew
Main, Anne
Malins, Mr. Humfrey
Maples, Mr. John
Maude, rh Mr. Francis
May, rh Mrs. Theresa
McIntosh, Miss Anne
McLoughlin, rh Mr. Patrick
Miller, Mrs. Maria
Milton, Anne
Mitchell, Mr. Andrew
Moss, Mr. Malcolm
Murrison, Dr. Andrew
Neill, Robert
Newmark, Mr. Brooks
O'Brien, Mr. Stephen
Oaten, Mr. Mark
Osborne, Mr. George
Paterson, Mr. Owen
Pelling, Mr. Andrew
Penning, Mike
Pickles, Mr. Eric
Prisk, Mr. Mark
Pritchard, Mark
Pugh, Dr. John
Redwood, rh Mr. John
Robathan, Mr. Andrew
Robertson, Hugh
Robertson, Mr. Laurence
Rogerson, Dan
Rosindell, Andrew
Rowen, Paul
Ruffley, Mr. David
Russell, Bob
Sanders, Mr. Adrian
Selous, Andrew
Shapps, Grant
Simmonds, Mark
Simpson, Mr. Keith
Soames, Mr. Nicholas
Spicer, Sir Michael
Spink, Bob
Spring, Mr. Richard
Stanley, rh Sir John
Steen, Mr. Anthony
Streeter, Mr. Gary
Stuart, Mr. Graham
Stunell, Andrew
Swayne, Mr. Desmond
Swinson, Jo
Syms, Mr. Robert
Tapsell, Sir Peter
Taylor, Matthew
Taylor, Dr. Richard
Teather, Sarah
Thurso, John
Timpson, Mr. Edward
Tredinnick, David
Turner, Mr. Andrew
Tyrie, Mr. Andrew
Vaizey, Mr. Edward
Vara, Mr. Shailesh
Villiers, Mrs. Theresa
Walker, Mr. Charles
Waterson, Mr. Nigel
Watkinson, Angela
Webb, Steve
Whittingdale, Mr. John
Widdecombe, rh Miss Ann
Wiggin, Bill
Willetts, Mr. David
Williams, Stephen
Willis, Mr. Phil
Winterton, Ann
Winterton, Sir Nicholas
Wright, Jeremy
Yeo, Mr. Tim
Young, rh Sir George
Tellers for the Noes:
Mr. David Evennett and
Mr. John Randall
Question accordingly agreed to.
Clause read a Second time, and added to the Bill.
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