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Finally, the noble Lord referred to charities with large headquarters in London that carry on campaigning work with government. It is not necessary to reply to that. Anyone who knows about the large amount of work, across a broad range of activities, that such charities carry out, and their valuable work in making representations to government on behalf of the groups they represent, will realise the necessity for maintaining premises and employing substantial numbers of staff. I will not dwell on that point. I declare my interest as chairman of one such large society, the Royal National Institute of Blind People.

Turning to the amendments of the noble Baroness, Lady Finlay, I will not range over the whole course of the subject matter that she addressed. I underline the point I just made about the respects in which the current scheme offered by the banks and building societies is not fit for purpose in addressing the need for a register that charities and individuals benefiting from legacies can access. The banks and building societies have launched a new online tracing scheme. This obviously represents a step in the right direction. However, there are still key gaps in the scheme, which mean that it does not amount to a register. The charities coalition, as we have heard, therefore believes that it is vital to maximise the opportunity over the longer term for the industry to get the scheme right. The amendments tabled by my noble friend provide a framework within which that can be done.

The new online tracing scheme is problematic in at least six ways. First, it is far less straightforward to look for lost bank accounts than it is to search across building society accounts and the National Savings and Investments database. Secondly, it requires some knowledge of which institution the account is held in. Thirdly, it covers only dormant bank and building society accounts. Fourthly, it does not enable people to search across a broad range of banking institutions. Fifthly, it is not clear whether the scheme incorporates different types of bank accounts; for example, internet bank accounts. Sixthly, it is not clear what records are included, or how far back records go.

At the moment there is no requirement for individual institutions to take part and members of the public are currently unable to search across a range of banks if they are not sure which institution is holding a lost asset. That is why the charities coalition is calling for the creation of a register of all unclaimed assets, which would ensure that beneficiaries—whether individuals or organisations such as charities—were reunited with assets owed to them from deceased people’s estates. To reunite assets and beneficiaries, members of the public and charities must be able to search a database with minimal information in the first instance—full name, last known address and, perhaps, date of birth, all of which are already publicly available. In the case of deceased people’s estates, information about the financial institution in which the asset is held is unlikely to be known, hence the

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difficulty in fully utilising the new industry tracing scheme, which requires an approach to an individual bank.

Furthermore, currently there is no requirement for financial institutions to make data available to any schemes. For the Unclaimed Assets Charity Coalition, the key to establishing a successful system is to ensure full participation by all financial institutions. As currently drafted, the Bill will not compel financial institutions to make data more easily accessible to the general public. Banks and building societies will simply be asked to publicise the fact that they hold unclaimed assets. That will be of no help to people who do not know which institution is holding a lost asset, and it will be of no help to charities trying to trace lost assets belonging to deceased people’s estates.

3.30 pm

Any register need not be maintained by the Government. It will, however, need to be created and maintained using stringent measures against fraud, as applied by, for example, the many unclaimed assets schemes operating in the United States. That means that no data beyond confirmation of a match between an institution holding an unclaimed asset and the details, which I mentioned earlier, as input by someone conducting a search would be released unless and until full proof of identity is produced to the institution holding the asset. This would be no less rigorous than any other proof of identity required to access an account.

To sum up, although the banks and building societies are launching a new online tracing scheme, this is not the same as a register, which is what the charities coalition is calling for. There is no requirement for individual institutions to take part and members of the public will not be able to search across a range of banks if they are not sure which institution is holding a lost asset. That is why the charities coalition continues to ask for the creation of a register.

As my noble friend has indicated, this is a moderate amendment. It does not call for the establishment of a register straight away. It gives the opportunity to see how the Bill will work as an Act until we get the first report of how it is working. It creates a reserve power for the Secretary of State to establish a register only if and when the report indicates that the scheme needs to be improved. I also ask noble Lords to support this valuable amendment.

Lord Newby: My Lords, as we debated the Bill at earlier stages, there was growing consensus that one of the most important things that it might achieve would be to increase the extent to which people were reunited with their assets rather than spending assets on worthwhile things that had been disunited—if that is the right word—from their owners. I very much agree with what the noble Baroness, Lady Finlay, said about that.

In Committee, we tabled an amendment for the creation of a register. We did not pursue it on Report because we wanted to ensure that we changed the Bill as far as we could, which required us to get the maximum level of support from across the House,

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which did not extend to the establishment of a register from the start. However, to have a reserve power to establish a register, which is what the amendment seeks, merely adds somewhat to the amendment that we successfully passed on Report. Therefore, we are very happy to give it our full support.

I hope that when the Minister replies, he does not use as a principal argument the fact that the scheme is technically a voluntary scheme. Again, we discussed that at great length at earlier stages. This is a statutory scheme in terms of how the money is spent, and I suspect that the only reason that noble Lords did not absolutely press for it to be a statutory or compulsory scheme from the start in legislation is that we received assurances from the trade associations, banks and building societies that every bank and building society that might be covered and affected by it would be a member of it. I do not believe that it is a valid argument that the amendment is irrelevant, unnecessary or inappropriate because it is a voluntary scheme.

However, I hope that it will never be necessary to bring the power into force. The British Bankers’ Association, the Building Societies Association and NS&I have established the website www.mylostaccount. Although I accept that at the moment it does not meet all the requirements that we would like, the pressure that the legislation has already caused has meant that the website is now up and running. In the three weeks since its launch, it has had some 72,000 claim forms submitted—more than for the whole of last year. That progress has happened only because this Bill has been going through your Lordships’ House. Having this reserve power hanging over the banks and building societies as a sort of Sword of Damocles should be used by the charities coalition as a means of getting improvements to the website over the next year or two so that it achieves everything that it wishes.

From my perspective, it does not matter desperately whether it is a formal register, against which every name on a dormant bank or building society account can be checked wherever it is held, or a simple search facility in which submitting a name and a few minimal details automatically searches across all of the banks and building societies that might be holding a dormant account. That seems to be a technical issue. However, I hope that, having established the website in its current form and having seen its success over the past three weeks, the banks and building societies will be encouraged to develop it further, particularly in the ways suggested by the noble Lord, Lord Low.

If it comes to a vote, we will therefore support the amendment in the Lobbies. I hope very much that that will not be needed.

Lord Walton of Detchant: My Lords, I warmly support these amendments that were so ably proposed by my noble friend Lady Finlay. I want to express my hope that the Government will give them a fair wind. I must declare an interest since in the course of my medical career I have become either president or vice-president, or patron or vice-patron, of about 11 medical charities of various kinds. While I accept some of the constraints that were mentioned by the noble Lord, Lord Hamilton, and others, I must point

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out that the contribution to medical research and care made by charities in the United Kingdom has been absolutely outstanding.

There is no doubt at all that, despite the significant increases of government funding that we have seen in recent years—through organisations such as the Medical Research Council, the National Health Service, and so on—those charities produce at least 50 per cent of the funds spent on medical research in the United Kingdom and they are largely dependent on bequests. I am, of course, not just talking about big players such as the British Heart Foundation, Cancer Research UK, or the Wellcome Trust, which has been quite outstanding in its support, but, more particularly, the smaller charities that have often been established by people with an interest in specific diseases. I refer to charities such as the Multiple Sclerosis Society, the Motor Neurone Disease Association, the Parkinson’s Disease Society, the Alzheimer’s Society and the Muscular Dystrophy Campaign, of which I have the honour to be an honorary life president. Such charities are, to a large extent, dependent on bequests and so on; in some instances, there is no doubt that funds which should and would have come to them under bequests have, somehow or other, been left in dormant accounts.

This amendment is a step along the road in trying to put that position right. Despite what was said by the noble Lord, Lord Hamilton, charitable foundations have made a tremendous contribution—not just to fundamental research and the care of sufferers from many of these diseases with which I have been familiar throughout my professional career, but in funding translational research. That has meant that they are funding research that translates the findings of basic laboratory research into developments in patient care. For that reason alone, I am very happy to support the amendments.

Lord Higgins: My Lords, as I understand it, we are debating Amendments Nos. 2, 3 and 4 as well as Amendment No. 1. I will concentrate my remarks on Amendment No. 2. When we discussed these matters in Committee and on Report, it became clear that charities, which are clearly concerned about these issues, could gain in one of two ways that are, to some extent, competitive. On the one hand, it could be that the rightful owners of the assets were not found, and that the assets then ended up in the so-called reclaim fund with the proceeds—or what remained in that fund—being distributed, unfortunately in my view, by the National Lottery to various deserving causes. So the charities could benefit in that way. Alternatively, it could be that they found that they were entitled to a legacy—as I understand it, that is very important in the case of small charities— and they would make a direct claim on a particular asset that had laid dormant in the bank. Obviously, if this second group made a successful claim, the first group would lose out, although in fact they might all be part of the same charity.

The other problem that arose was with regard to confidentiality. I have some experience in these matters, because I was asked some 10 years ago by Mr Paul Volcker, the chairman of the Federal

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Reserve, to become an arbitrator with regard to the Claims Resolution Tribunal for Dormant Accounts in Switzerland. I had not fully appreciated from that experience that that was a very unusual circumstance because the Swiss Government had legislated so that the names of the account holders could be revealed. I understand that that is not true except for accounts that have been dormant since World War 2. Therefore the situation in Switzerland and here is that bank confidentiality is regarded as very important and my understanding is that the banks are not prepared to release the names of the people concerned so that, for example, charities could discover whether they had a legacy or not.

Amendment No. 2 gets around that to a considerable extent but involves the establishment of a register, which would be a sensible development. The register could remain confidential, but under paragraph (b) of new subsection (3B) of Amendment No. 2, it would be possible for a charity which believed that it had a legacy in a dormant account to go to the registrar and ask him whether that was so. As the noble Baroness pointed out, that is an extremely difficult process at present because you do not know which bank might have the account, whereas if there was a register all the accounts would be coalesced.

This is the right approach; it would maintain confidentiality but enable the charities to ascertain whether in a particular case they were entitled to obtain what was rightfully theirs. It has been pointed out that this is a modest amendment; we can see how the scheme operates for three years before there is a report, but at least at that stage it will be sensible to consider the establishment of a register, and we can review the whole thing in the light of the experience of the charities in the mean time. We certainly do not want to come back to primary legislation at that stage and, therefore, it is right that we support the amendments.

Baroness Wilkins: My Lords, I apologise that I have not taken part in the previous stages of this Bill, but I would like to register my strong views and my strong support for these amendments proposed by the noble Baroness, Lady Finlay, and supported by the right reverend Prelate the Bishop of Exeter and the noble Lords, Lord Low and Lord Higgins. This issue crosses all sides of the House.

Like many of your Lordships, I have an interest to declare: I am a trustee of a small local charity—Hammersmith and Fulham Action on Disability, or HAFAD. It is run by and for disabled people to promote equality of opportunity, choice and independence for all disabled people by removing barriers and ensuring that support services meet the needs of disabled people in the borough. Services include a wide range of youth activities such as holiday schemes for profoundly disabled young people, help for disabled people with finding employment, welfare rights and benefits advocacy, support for people receiving direct payments for their personal assistance, and an information service.

HAFAD’s funding comes from a wide variety of sources including the local authority, the National Lottery, the New Deal, and numerous charitable

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trusts. It is matter of constant juggling and piecing together of pockets of funding and trying to add them together to form viable projects which do not raise people’s expectations only to dash them within a few months. In other words HAFAD’s continued viability can be somewhat precarious and its reliance on the generosity of others, whether in terms of time or money, is constant. As we face the spectre of an economic downturn and a period of financial uncertainty, think what a difference finding an unclaimed asset in a dormant account left as part of a legacy might make to a charity such as HAFAD. That is what these amendments would help charities such as HAFAD to do.

The reason why these amendments are particularly important for small charities such as HAFAD is their simplicity. That point seems to have been ignored by the noble Lord, Lord Hamilton of Epsom. The proposed register would mean the least amount of bureaucracy possible to enable a charity to access the funds which local people have intended it to receive. While trustees might be able to gather together various pots of money for funding a project, trying to find funding for the ongoing management of the organisation is well-nigh impossible. Small charities simply do not have the person power to trawl through bank and building society accounts trying to trace lost assets, a point which has been so eloquently put by the right reverend Prelate the Bishop of Exeter. That is why this amendment is so important and why I am pleased to support the noble Baroness today. She understands the difference that small local charities, in particular, can make to people’s lives, often with very little resource. I want charities to know that the law is on their side and that this House has done everything in its power today to reunite them with the assets which are rightfully theirs.

Viscount Tenby: My Lords, I support wholeheartedly the amendment moved by my noble friend. In the wake of quite outstanding speeches in support of the amendment, which have been clear and concise and really quite moving, I declare an interest as chairman of a residential home for women with learning and physical disabilities. We are very local and very small. We exist on crumbs from the rich man’s table. Consequently, anything that can be done in the form of help from the Government, charities, trusts and so forth is crucial to our continued existence. Therefore, I commend the amendment to the House.

Lord Howard of Rising: My Lords, the amendments proposed by the noble Baroness, Lady Finlay, about which the right reverend Prelate the Bishop of Exeter and many other noble Lords have spoken so movingly, are strongly supported by a most distinguished group of charities. Indeed, it would be difficult to find a single collection of institutions more worthy of support. I should declare, before going further, that I am a trustee or officer of a number of registered charities, most of which are small and local.

We on these Benches wish to assist in enabling charities to find bequests to which they are entitled, but the amendments raise some misgivings. With

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respect to the comments of the noble Lord, Lord Newby, the Bill provides for a voluntary scheme, with the banks and building societies administering it and continuing to maintain existing banking confidentiality. If a register is created, then there must be access to it for it to be of any use. Access by outside bodies, however honest, noble and reliable they may be, means an erosion of privacy, even if it is a modest one. The very existence of a bank account may be a confidential matter. I am uncertain whether the gains from having a central register would make up for the loss of this important principle.

In this day of easy, quick and cheap electronic communication, it is no more difficult to ask a number of financial institutions to search on your behalf than it is to search yourself—indeed, that is probably easier, especially for the smaller charities, which do not have the resources to make the search. The important principle of banking confidentiality would be maintained.

As was pointed out by the noble Baroness, Lady Finlay, Clause 12, which was introduced by my noble friend Lady Noakes, provides for a triennial review of the operation of the dormant account arrangements. With the knowledge that this spotlight will be pointed in their direction, there will be every incentive for financial institutions to make a success of the scheme and to give all assistance to those wanting help in finding assets that belong to them.

We should remember that banks and building societies are massive givers to charity—they give tens of millions of pounds—and it is unlikely that they would not want to help. The issues raised by the noble Baroness, Lady Finlay, have been raised in turn with the BBA, which has been most encouraging in its recognition of the need to work with charities, especially in the early days, when the backlog of dormant accounts will have to be dealt with. As my noble friend Lord Hamilton said, to set up the suggested register would involve expense. As has been pointed out, while it may be self-financing, there will certainly be an initial cost that must be met from somewhere, and there will be running costs thereafter.

Lord Davies of Oldham: My Lords, I am grateful to all noble Lords who have spoken in this extremely interesting debate and to the noble Baroness, Lady Finlay, for moving her amendment.

It will be appreciated from the debate how much there is agreement on all sides about the Bill’s central purposes, which are to ensure that dormant accounts are reunited with their rightful owners and, where they are not, that after a 15-year period, the resources will be devoted to public advantage. There is not a single noble Lord who has spoken in this debate who has not subscribed to those objectives; all noble Lords have added a great deal of colour and emotion and emphasised the fact that some of the good from the development of this work will involve advantage to charities. The Government recognise the powerful statements made by the noble Lords, Lord Low and Lord Walton, and the right reverend Prelate the Bishop of Exeter on the advantages of charities—the roles that they play in our society. I make it absolutely

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clear that nothing that I say about the amendment is in any way critical of the objective that charities, which do so much good for the public, should have opportunities for the enhancement of their resources.

The first objective is how we ensure that account holders are reunited with their property so that only genuinely dormant accounts are transferred to the scheme. That is right and fair to customers; after all, it is their money which is the subject of this debate. Of course, a result of the reunification of accounts with customers will ultimately mean a reduction in the administrative costs of the reclaim fund, otherwise the reclaim fund, in certain cases, will be obliged to repay customer reclaims at a later date. That is bound to involve administrative costs, which will, therefore, reduce the amount of money available to benefit the public.

What is the effective and proportionate response? The noble Lord, Lord Hamilton, may be thought to be a lone voice on these issues today, but he was concerned in Committee about proportionate response; he is also concerned about confidentiality and the administration of the scheme. Those are also the proper concerns of Government. We have emphasised throughout the debate, today and in the earlier proceedings on the Bill, that the banking and building society sector and National Savings and Investments should take the lead in reuniting customers with their accounts prior to the launch of the scheme. The industry should put in place extensive and robust arrangements for continuing that work after the scheme is up and running.

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