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Baroness Thornton: My Lords, we fully share the noble Lord’s concern, and we are determined to reduce the harm caused to young people by alcohol
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Lord Taylor of Blackburn: My Lords, does that apply to the medical profession as well?
Baroness Thornton: My Lords, I do not think that I am qualified or equipped, or would dare, to answer that question.
Lord Krebs: My Lords, will the Minister explain why the Government are undertaking a further review of the efficacy of different measures to curb excessive alcohol consumption when only a few years ago the World Health Organisation carried out a comprehensive worldwide review of effective policies? The WHO concluded that curbs on marketing and restrictions on availability and price are the most effective measures to curb excessive alcohol consumption, and that warning labels and information campaigns are ineffective. Why is there a need to review the evidence again when it has been reviewed thoroughly by an international body?
Baroness Thornton: My Lords, the WHO framework has informed much of the work that the Government are doing. The Government’s strategy is firmly based in monitoring what will happen this year. If the right results are not produced in terms of advertising, the Government will consider legislation.
Northern Rock
3 pm
Lord James of Blackheath asked Her Majesty’s Government:
What contingency fund they are providing to cover any shortfalls arising in the guarantees provided to Northern Rock; and what its effect will be on fiscal policy.
Lord Davies of Oldham: My Lords, the guarantee arrangements have not been called. There has therefore been no cost to the taxpayer. If the guarantee were called, parliamentary approval for expenditure would be sought through the normal supply process. Costs would be met from the contingencies built into the fiscal forecast in the normal way. The Government will report on the fiscal position at the Budget.
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Lord James of Blackheath: My Lords, I thank the Minister for that Answer. As he will recall, however, on 14 January he addressed your Lordships' House on the same subject and informed us that £150 billion-worth of assets were available in Northern Rock and that the amount of government liability was but a fraction against that; it was said at the time to be £56 billion. Since then, as he will be aware, we have had references to Granite and to Dolerite. Note 22 of the recently signed 2006 accounts for Northern Rock lists 23 companies performing the same function. Would he therefore like to say the same thing again today—that he is still comfortable that the liability is but a fraction? It sounds as though the liabilities are now a fraction of the guarantee.
Lord Davies of Oldham: Not so, my Lords. As was made clear in both Houses in the debate last week on Northern Rock, Dolerite does not exist and the guarantees do not extend to Granite. The guarantees extend to Northern Rock and its assets. Its assets are secure and outweigh its liabilities.
Lord Lawson of Blaby: My Lords, does the Minister recall that only yesterday, in answer to a Question from my noble friend Lord Steinberg, he informed the House that, so far as Granite was concerned,
- “the Treasury will be making the details of the position clear today”?—[Official Report, 25/2/08; col. 438.]
He was subsequently obliged to write to my noble friend to say that he had got it all wrong and that the Treasury had nothing to add to the singularly uninformative letter to Mr Vincent Cable a week ago. Does it not mean that the Treasury is every bit as much in the dark about the true complexity of the relationship between Granite and Northern Rock as the rest of us? Will the Minister therefore put in place an investigation without further delay, preferably conducted by the National Audit Office, into the full facts of this tangled tale and the risks to the taxpayer that follow from it?
Lord Davies of Oldham: My Lords, I think that the noble Lord doth protest too much. However, I am grateful for the opportunity that he affords me, and which I recognised would be presented by this Question, to apologise for the fact that I made a mistake yesterday in responding to the noble Lord. I intended to convey that the Government will in due course be presenting, in full publicity, the Northern Rock strategic business plan. I am happy to confirm that they will do that. It has, of course, been the burden of many representations.
I emphasise that Granite has no relevance to the public position at all. The Treasury guarantee and the loans provided by the Bank of England have nothing to do with the assets in Granite. The guarantees relate to the assets in Northern Rock. Those are sound, substantial and above the level of loan that it has taken from the Bank of England. As the noble Lord will know better than anyone else, Granite is merely a securitisation vehicle for the processing of Northern Rock money. Those responsible for meeting the costs of Granite are bond holders, not Northern Rock—therefore, not the Government at all.
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Baroness Symons of Vernham Dean: My Lords, does my noble friend enjoy this now almost daily opportunity, which the Opposition are kind enough to afford him, to demonstrate the strength of the British economy, the strength of the City of London, and just how desperate the Opposition have clearly become on this issue?
Lord Davies of Oldham: My Lords, it is certainly the case that the Opposition have narrowed their arguments. I promise the House a further instalment tomorrow.
Lord Newby: My Lords, does the Minister acknowledge the continuing considerable confusion about Granite, which, with all due respect, I think he has just compounded? Will the Government urgently convene a seminar for Members of both Houses with an interest in this matter at which the Chancellor of the Exchequer and Mr Sandler can explain, once and for all, clearly and to avoid ambiguity in the future, the status of Granite and how it affects the ongoing fortunes of Northern Rock?
Lord Davies of Oldham: My Lords, I cannot make the issue with regard to Granite any clearer, but what I can say to the noble Lord is quite straightforward. In due course—by which I mean very shortly, by the end of March—the strategic business plan for Northern Rock will be published. It will of course be in the public domain. Any Member of either House will be able to raise and debate the issues at that point. However, as was explained during the Bill’s passage last week, and as I have attempted to explain today, Granite’s obligations cannot be a charge on the taxpayer. They are a charge on the bond holders and are nothing to do with the taxpayer because they are not governed by the Treasury guarantee. Nor do they have anything to do with the Bank of England loan.
Dormant Bank and Building Society Accounts Bill [HL]
3.07 pm
Clause 12 [Triennial Report to Parliament]:
Baroness Finlay of Llandaff moved Amendment No. 1:
Clause 12, page 7, line 31, at end insert “, and to be able to trace all such accounts at any one time”
The noble Baroness said: My Lords, I wish to speak to all the amendments together, as they address a principle that is at stake: enhancing reunification of bequeathed assets with the beneficiary, however small a benefiting charity may be. I have tabled these sharply defined amendments to enhance the amendment moved by the noble Baroness, Lady Noakes, and passed by the House on Report, providing for a triennial report to Parliament on the working of this Bill. These amendments simply provide for a clearly defined, specific enabling power. They would not impose any additional burdens or give the Secretary of State extensive powers.
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This Bill will have a considerable impact on the charitable sector. I declare an interest as vice-president of Marie Curie Cancer Care, which, along with 53 other charities, is part of the Unclaimed Assets Charity Coalition. The coalition supports these amendments.
Amendment No. 1 is crucial. Without it, the register would not work as a one-stop shop search facility, which is essential if charities are to be able to conduct searches quickly and cost-efficiently. In the case of deceased estates, information about the financial institution in which the asset is held is unlikely to be known, hence the difficulty in utilising the new industry tracing scheme, which requires an approach to each and every individual bank. My amendments would maximise the incentive for banks and building societies to reunite people, including the beneficiaries of wills, of which many are charities, with what is rightfully theirs—their assets in dormant accounts—while also ensuring that, where reunification efforts prove fruitless, as much as possible is available for reinvestment in society.
As drafted, the Bill will not require financial institutions to make data on unclaimed assets more easily accessible to potential beneficiaries of legacies. Instead, banks and building societies will simply be asked to publicise the fact that they hold unclaimed assets. This will be of no help to people who do not know which institution is holding a lost asset. Crucially, it will be of no help to charities trying to trace lost assets bequeathed to them from deceased people’s estates. This will be a particular problem for small charities.
Why does it matter? One in seven people who die with a valid will leave legacy gifts to charity, which, on average, comprise 5 per cent of the total estate left, so there are potentially large sums of legacy income that have yet to reach the named charities. Legacies are an extremely important source of voluntary income for the charitable sector. For example, 46 per cent of the British Heart Foundation’s voluntary income is from legacies, amounting to more than £47 million last year, while Cancer Research UK relied on legacies for a third of its income. There may have been many more bequeathed amounts that could have gone to the charities, but these are unknown at present.
The banking and building society industry has introduced a welcome new online tracing scheme, the launch of which coincided with the Bill. However, while this is a step in the right direction, it is completely inadequate and does not create the register needed if beneficiaries, including charities, are to be more easily reunited with their assets. The online tracing scheme is not straightforward. It requires knowledge of which institution holds the account and it does not enable searching across a broad range of banking institutions.
Let me now address a few of the issues raised by your Lordships on Report, when I proposed giving powers to the Secretary of State to establish a register if needed. The noble Baroness, Lady Noakes, suggested that charities want access to accounts long
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The Minister, the noble Lord, Lord Bach, mentioned cost, stating that a register would be expensive. The Unclaimed Assets Charity Coalition believes that a register should be no more costly to run than a voluntary scheme. In fact, a register could be self-financing and need not be maintained by the Government. Moreover, in the longer term, having such a system in place would reduce administrative burdens. A central register would establish a consistent system and format for information about dormant bank and building society accounts and would facilitate searching, particularly by small charities which do not have the manpower to undertake widespread searches, as well as shorter processes for financial institutions to locate and return dormant accounts to their rightful owners.
The Minister also raised confidentiality issues. The coalition has sought advice from Withers legal partnership, which has now been shared with the Treasury. Withers confirms that data protection and fraud issues would not be a barrier to a register. I can therefore assure the House that the amendments would not breach confidentiality of information agreements. Indeed, a register would be less open to problems of data protection than the scheme operated by industry at the moment.
The industry’s new online tracing scheme operates on a central website portal where people can enter their personal details. These details are then sent to a number of banks and building societies around the country, increasing the risk that information could be intercepted or diverted. In contrast, a central register would hold minimum data centrally, such as the name of the account holder, their date of birth and their previous or last known address. The register would enable someone to establish only whether there was a match between a legatee, for example, and a dormant account. It would then direct the charity conducting the search to a specific institution. The charity would still be required to go through stringent proof-of-identity processes with the institution holding the asset. That would be no less rigorous than any other proof-of-identity process required to access accounts. A number of other tried and tested schemes around the world use a register system, including in the US and Australia.
I agree with the point raised by the noble Baroness, Lady Noakes, that accountability to Parliament is vital and I am sorry that she is unable to be in her place today. My amendments would strengthen that accountability and enable Parliament to effect its wishes without recourse to further primary legislation. I worry that there is a presumption that assets in dormant accounts are somehow the state’s money. They are not. These assets are not ours, the Government’s or Parliament’s, and they are certainly not the industry’s. They are unclaimed assets in dormant accounts that in many cases have been bequeathed, as a proportion of a deceased estate, to a charity. The tightly drafted amendments would help to ensure that people’s dying
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3.15 pm
The Lord Bishop of Exeter: My Lords, I am delighted to support each one of these small but important amendments in this group. The noble Baroness, Lady Finlay, referred to the 54 charities that comprise the Unclaimed Assets Charity Coalition. I know from my own contacts with the group how passionately those charities feel about this matter. These amendments afford your Lordships’ House an opportunity to improve the legislation before us and to enact a profound good.
At this stage of our deliberations I do not intend to repeat the powerful arguments advanced by the noble Baroness. Instead, I shall draw your Lordships’ attention to the benefits of the amendments in a slightly broader strategic context. Here I declare an interest as a trustee of Christian Aid and chairman of the Melanesian Mission UK. Of the first of these charities most, if not all, of your Lordships must surely be aware, but of the second I suspect that few will have heard. Yet it is the latter, the Melanesian Mission UK, which, as the smaller charity, is particularly pertinent to our deliberations today. Why? For the simple reason that legacies are even more important to smaller charities, which simply do not have the means or the infrastructure to fundraise to anything like the same extent as the bigger charities. They lack the resources to engage in a complex search for assets that, in the form of legacies, it was intended that they should receive and they stand to lose disproportionately more from the lack of an ability to do so.
Like the noble Baroness, I have looked at the membership of the charity coalition that has expressed such concerns about the Bill in its present form. The breadth of the coalition is extensive and impressive. I also know from my own experience from chairing bodies such as the Devon Strategic Partnership—its aim is to improve the quality of life for people living in Devon by bringing together a huge and disparate range of interested parties to tackle a diverse range of issues such as transport, energy, domestic violence and welfare benefits—that bringing people together to sing from the same hymn sheet is not easy. Yet this coalition is singing from the same hymn sheet. It deserves to be listened to in this one respect more than it has been to date.
I am told that at least 26 Members of your Lordships’ House are patrons of some of the charities within the coalition. Many others will have supported these and other charities in many different ways. With these amendments, we are being given the opportunity not just to do as the Minister rightly suggested on Report, which is to thank our marvellous charity sector for the invaluable work that it does, but to give a practical demonstration of our support for all charities, which are so vital in a healthy society, whether they be small or great, in memory of a loved one or an international charity such as Christian Aid that is literally changing the world for people in the direst poverty and offering them real hope of life before death.
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The point at issue is not just about gratitude. It is also most profoundly about justice and respect—not just for and to the charities but for and to those who do, and wish to, support them and who have made their wishes very clear as they have drawn up their last will and testament in preparation for their own death. It is about the justice of doing everything that we reasonably can to respect people’s dying wishes to leave something to charity and of ensuring that charities are thus reunited with any unclaimed assets that have been bequeathed to them; in other words, what is rightfully theirs. That is what the noble Baroness’s reasonable, tightly defined and beneficial amendments would help to achieve and it is why I urge your Lordships to give them the support that they deserve.
Lord Hamilton of Epsom: My Lords, with all due respect to the noble Baroness and the right reverend Prelate, I confess that when this issue was raised in Committee I had reservations about it. I have even more now. This will be a great opportunity for fraudsters to examine the register in detail to determine whether they can extract money from it. I do not altogether understand who will carry the cost of drawing up the register and, indeed, of maintaining it. Some cost must be involved and I am not at all certain who is supposed to carry it.
Another worry is that when charities look to people’s wills they surely look to bequests that come off the top layer of a will. The only thing that will be left in a dormant account is the residual amount in that will. Therefore, the charity would have had to be left absolutely everything in somebody’s will before it would be in a position to pick up what was left in a dormant account.
I have a further concern about our charities generally. So many of them now seem to have massive headquarters in London and spend their whole time playing politics. The rather depressing thought occurs to me that they would add to their numbers by having yet another person to go through the register to see whether they can leach a bit more money out of dormant accounts. So I have reservations about this measure and it is only right that I should mention them.
Lord Low of Dalston: My Lords, I support the amendment most ably moved by the noble Baroness, Lady Finlay, and supported by the right reverend Prelate. Picking up the points just made by the noble Lord, obviously some costs will be entailed in maintaining a register, but I submit that they are surely worth bearing when a scheme short of a register, such as is offered by banks and building societies at the moment, is not fit for purpose and is ill adapted to enabling beneficiaries to be reunited with assets bequeathed to them.
The noble Lord spoke about residuary bequests. If one knows anything about legacies left to charities, one knows that residuary bequests are of great importance. They are the preponderance of bequests; only a comparatively small number of specific legacies are
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