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Baroness Noakes moved Amendment No. 33:
The noble Baroness said: In moving Amendment No. 33, I shall also speak to Amendment No. 35.
These amendments delete subsections (1) and (2) of Clause 9 respectively on a probing basis. Clause 9 defines what is meant by “account” and subsections (1) and (2) appear restrictive. I should have thought that the Government would want as liberal an interpretation as possible of the definition of an account so that as much as possible could be transferred to the reclaim fund, especially in the light of the extremely narrow scope of the Bill, which we have already debated, and the scope of assets being restricted to bank and building society accounts only.
Under subsection (1) the account must at all times have “consisted only of money”. Accounts are always expressed in terms of money. That is true whether they are the accounts of banks or of, say, manufacturers. If I make widgets and buy a widget-making machine for which I pay money, I put that amount in my accounts. It is under a fixed-asset label, but it is still money. I therefore do not understand the practical impact of subsection (1) and should be grateful if the Minister would explain it.
Subsection (2) restricts accounts to those that are,
Again, I do not understand why the Bill has to be so restrictive. Surely if a bank or building society ends up with its customer’s money on its books, it does not much matter whether it arrived through the door labelled “deposit taking” or one labelled “other financial services”.
I shall ask the Minister a specific question to illustrate this point. If I have a SIPP—a self-invested personal pension—with a division of one of the banks, that SIPP will have some investments, possibly a great variety of them, but it will also have a bank account through which some of the various transactions flow. That is a statement of fact. My SIPP got that bank account because I set up the SIPP not because I wanted a bank account. Therefore, the
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It seems to me that a bank’s customers do not have the internal divisions of the banks in their minds when they deal with them. Yet the Bill is predicated on some concept, which I do not quite understand, but which seems to be based on how a bank is organised. I hope that the Minister can explain that. I beg to move.
The Deputy Chairman of Committees: I point out that if this amendment were agreed, I cannot call Amendment No. 34 by reason of pre-emption.
Lord Davies of Oldham: The noble Baroness leads me potentially into deep waters, and I shall cling pretty much to the ankle-depth ones where I find myself at home, as indeed, does the Bill.
There may be merit here, and I know that other amendments have been tabled about other financial deposits that may be dormant and could usefully be put to better purposes than lying idle in banks. I have seen the amendments that have been tabled and recognise the fertility of the minds of noble Lords. We are going to resist those amendments on the simple basis of clarity and simplicity with the launch of a scheme that involves the Government in significant co-operation with the private sector. The company running the scheme will be a private company, which will make it clear that it accepts our initial approach carried, as the Committee will know, in a Labour manifesto way back in 2005. We were talking about current or savings accounts in a straightforward way.
I hear what the noble Baroness says. Of course there is a range of other assets that perhaps could eventually fit within this framework if they became dormant. However, we are concerned that any assets except ordinary current and deposit accounts raise different issues, including legal issues. Before we extended beyond the simple deposit and current accounts, which is the basis of the agreement with the banks and building societies, we would have to discuss it with the various stakeholders involved. We have not yet carried out that discussion or entertained any prospect of doing so. As noble Lords will recognise, this is an ambitious project that takes a great deal of careful thinking and activity to bring it about. We are therefore keeping the concept, as regards accounts, as straightforward and simple as we can. We are talking about current and deposit accounts only.
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7.30 pm
Lord Shutt of Greetland: I wonder whether it would be appropriate—I just happen to have a copy of the Labour manifesto with me—to read this wonderful sentence:
“We will work with the financial services industry to establish a common definition and a comprehensive record of unclaimed assets”.
It says “assets” there, by the way, not just “bank accounts”. That phrase “common definition” is very important because of the need for a level playing field. That is my concern, and I will come back to it on another occasion; I have a related amendment, though whether we will get to it tonight is another matter. But it is interesting to see what the Government’s own manifesto had to say.
Lord Davies of Oldham: The noble Lord will give due regard to the foresightedness of drafters of manifestos, who are unparalleled in their ability to open up opportunities for the future. The manifesto of course expresses a framework that gives opportunities for the most extensive of schemes. Governments, however, have to deal with the practicalities of that which can be achieved. I know that the noble Lord has not the slightest hesitation about wandering off into the wilds of flights of fancy in this respect, but we can get through—both in terms of Parliament and this Bill and the practicalities of the relationship with the industry—only that which we are able to negotiate. That is why we are concentrating on the savings accounts and deposit accounts in banks and building societies.
Baroness Noakes: The noble Lord, Lord Shutt, has raised some important points, but I was simply probing what these terms actually mean. I do not understand what,
means, and the Minister has not explained it. He said that it is current and savings accounts. That is not what Clause 9 says; it uses these terms which the Minister has not explained.
We are going on too late this evening. I shall withdraw my amendment, but as we are at a point in the Bill where I can table further amendments for our next sitting, I shall try to table amendments that deal with the same probing issues—that will test my ingenuity—but shall not delay the Committee further this evening. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Bach: I beg to move that the Committee be adjourned sine die.
The Deputy Chairman of Committees: The Committee is adjourned sine die.
- Committee adjourned at 7.34 pm.
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