The next item of business is the Executive Committee’s legislative consent motion relating to the Dormant Bank and Building Society Accounts Bill [HL].

I beg to move

That this Assembly agrees that the provisions in the Dormant Bank and Building Society Accounts Bill relating to the distribution in Northern Ireland of sums released from dormant bank and building society accounts should be considered by the UK Parliament.

I have tabled the motion to seek the Assembly’s agreement to the inclusion of Northern Ireland in the provisions of a Westminster Bill that aims to release millions of pounds from inactive bank and building society accounts and reinvest them in local communities. Alongside that, the rights of customers to reclaim their money, at any time, will be preserved.

The scheme was first announced formally in the Chancellor’s 2005 pre-Budget report. Since then, discussions have taken place with the banking industry, followed by two UK-wide public consultations. That has culminated in the Dormant Bank and Building Society Accounts Bill [HL], which was introduced in the House of Lords on 7 November 2007.

Banking and financial services is a reserved matter, and therefore the Assembly could not legislate on this issue. However, in keeping with the spirit of devolution, provision has been made in the Bill for the three devolved Administrations to set the priorities for distribution in their respective jurisdictions.

As the Bill proposes to give the Department of Finance and Personnel new executive functions and the power to make an Order setting the spending priorities for distribution in Northern Ireland, the consent of the Assembly is required.

The Bill defines dormant accounts as those that have had no customer-initiated activity for a period of 15 years. It is anticipated that dormant accounts could initially amount to more than £500 million across the UK, with tens of millions of pounds recurring annually thereafter. Northern Ireland will benefit alongside the other UK Administrations, on a population basis. Initially, additional resources have been estimated at between £10 million and £20 million, with hundreds of thousands of pounds each year thereafter.

In preparation for the commencement of the scheme, financial institutions have already begun a comprehensive exercise to make every effort to reunite customers with their assets. Members may have already noticed advertisements in the local press to that effect. The assets identified in dormant accounts will be transferred by banks and building societies to a reclaim fund. That fund will be independent of the Government and the banking industry, and will be regulated by the Financial Services Authority.

It will be the duty of the reclaim fund to retain and invest a prudent portion of the assets in order to meet any future repayment claims from customers. That is a key point, and it will ensure that customers will be able to reclaim funds transferred to the scheme at any time. Assets not needed to meet the reclaim risk, or reasonable running costs, will be released for distribution.

In light of its UK-wide infrastructure, its experience in distribution and the efficiency benefits that that brings, the legislation names the Big Lottery Fund as the vehicle for distributing funds throughout the UK. I recognise the valid concerns that many in our community will have about that approach, and I have made strong representations to the Treasury on that basis. In response, the Treasury has assured me that all scheme resources represent a separate and distinct funding stream from lottery funding. Distinct branding will be used for all projects funded through the scheme. That approach will ensure that all projects funded from the scheme will have no links with the proceeds of gambling.

I emphasise that the funds will not form part of public spending. The only influence that the Executive will have on the scheme, following the passing of enabling legislation, will be in setting the local priorities for spend and in issuing directions to the distribution body.

As this money belongs to customers — albeit unclaimed by them — it sits within the banking sector. Therefore, it would not be appropriate for Government to seize it and spend it directly.

As for the priorities to benefit from these assets, the Bill provides a general definition of “social or environmental purposes” on which unclaimed assets may be spent. It is within that overarching theme that the Assembly will be able to set its own spending priorities in Northern Ireland, and those priorities will be reflected in the directions given to the Big Lottery Fund for distribution here.

If Members agree the legislative consent motion before them today, I will undertake a consultation in early 2008 on the Northern Ireland spending priorities. I will then bring proposals to the Executive and Assembly for agreement.

The dormant accounts scheme has the potential to deliver real benefits to communities across Northern Ireland by freeing up resources that are lying idle in dormant accounts and reinvesting them in needy communities. Should the Assembly give its consent to the Bill’s provisions, it will have an excellent opportunity to set the priorities for spending Northern Ireland’s share of the proceeds. The Executive approved the legislation at a meeting on 8 November, and I now invite Members to do the same.

As the Minister has already explained, the Dormant Bank and Building Society Accounts Bill [HL] is going through West­minster, and Northern Ireland in included in the legislation. The Bill deals with the reserved matter of financial services, and it is the Committee’s under­standing that, in the spirit of devolution, the UK Government decided to make provision in the Bill for the devolved Administrations to set spending priorities and to have some input into the distribution of moneys in their jurisdictions.

The Assembly’s consent is required in order for Northern Ireland to be included in the legislation, in so far as the Bill contains provisions that confer new executive functions on the Department of Finance and Personnel. As the Minister has explained, the Depart­ment will have the power to make Orders that identify the spending areas in which the Big Lottery Fund may distribute funds from the unclaimed assets of dormant bank and building society accounts that are apportioned to Northern Ireland.

The Committee for Finance and Personnel held two separate evidence sessions on the Bill with DFP officials, including the principal legal officer in the Departmental Solicitor’s Office. Those meetings were recorded by Hansard, and the Committee decided to publish the minutes of evidence on the Assembly website to ensure that the details of its deliberations were available to the wider body of MLAs and other stakeholders. The Department also provided Committee members with copies of the draft Bill.

During the first evidence session on 24 October, Committee members raised a range of issues. These included: the consequences should the Assembly not give its legislative consent; how the alternative scheme for smaller banks and building societies would operate; the risk of reclaim, and the process involved; ethical concerns over the use of the Big Lottery Fund as the distribution vehicle and as a barrier to applications for funding; measures to ensure that spend goes to worthwhile projects; and the reasons why dormant accounts could not be allocated directly to devolved Administrations for distribution.

The Committee raised those issues formally with the Department and received a substantive written reply. A further evidence session was held with DFP officials on 7 November, after which the Committee was content that the Department had adequately addressed its specific concerns.

On the key question of what the consequences would be were the Assembly not to give its legislative consent to the legislation, the Department advised the Committee that it was likely that the UK Government would still proceed with it as planned, given that financial services is a reserved matter. The Bill would be amended, removing the provisions that confer on DFP the functions of setting the Northern Ireland priorities for spend and giving directions to the Northern Ireland committee of the Big Lottery Fund.

Therefore, while the Welsh Assembly and the Scottish Parliament would have the power to set out particular spending areas for the money apportioned to them, the Northern Ireland Assembly would not. We would be missing an opportunity to influence the spending priorities for Northern Ireland and to give directions to the Big Lottery Fund. In addition, the voluntary and community sector in Northern Ireland would be unable to feed its views into the local consultation process.

In general terms, therefore, while the Committee has reservations about the Bill, including the bureaucracy associated with some of its provisions, Members agreed that a pragmatic approach is required so that Northern Ireland does not lose out significantly. Consequently, the Committee agreed unanimously on 7 November to support the Department of Finance and Personnel in seeking the Assembly’s endorsement of the principle of the extension of the provisions of the Dormant Bank and Building Society Accounts Bill to Northern Ireland. I support the motion.

Go raibh maith agat, a LeasCheann Comhairle. The Deputy Chairperson of the Finance Committee has fully set out the Committee’s deliberations; I am speaking in a personal capacity as a member of Sinn Féin.

I support the motion. The Bill is a pragmatic response to the issue of funds that are lying dormant in the reserves of the banking institutions in this state. Its provisions will empower the application of those dormant funds to very important projects that the Executive and, indeed, this Assembly would wish to see addressed. The fact that these funds are benefiting no-one in any particular way is an issue that has been unaddressed for a considerable period of time. There is some comparative experience in the measures that have been adopted South of the border, and it has been seen that, particularly in regard to the social agenda, these funds can be applied where funding might not otherwise be available.

It is important to acknowledge the small number of financial institutions that trade solely in this state. They will have the power under this legislation, having taken the proper steps to identify the funding as being in dormant accounts to which there is no immediate claim, to apply it in the areas in which they trade. One or two examples of institutions that trade solely in particular locations have been made known in the background research. In Derry city, for example, where I live, there is one such institution. Funds that are released by this mechanism can and will be applied by that institution in its immediate location. Again, that is to the good.

All in all, the concerns that people have about the procedural difficulties can be legally proofed. We can revisit the arrangements if they prove to be inadequate. At this stage, no one can quantify the sums of money involved. They might be considerable, or they might not. However, the question will at least have been answered, and a mechanism devised by which they can be applied to the greater good, rather than lying dormant and obsolete. I strongly endorse the motion and commend it to the House.

I support the motion. This is an advantage to the public purse. Good can be done through these resources being made available. It also works for the banks by removing liabilities from their books. I have little to add to the comments of the last two Members, but I do have a couple of points.

First of all, this type of procedure is fairly common internationally. Mr McLaughlin referred to the experience of the Republic of Ireland, and there are many other international examples. This is not something new or sinister that is being put forward by the Government.

Secondly, one small concern is that resources are to be redistributed to the devolved regions of the UK on the basis of population, as opposed to need and — as we are all aware — resources from the block grant are allocated by need, rather than by population. Although I appreciate that the sums involved may be relatively small in comparison with our overall block grant, it is important that that point be made to the Treasury, and that we preserve a needs-based approach to financing. There may be some financial implications for Northern Ireland as a consequence of the change in approach to that formula.

A further important point is that the money in dormant accounts belongs to people. The account holder may, sadly, have passed away. Equally, however, the bank may not be able to contect them because they have changed address. It is important that the process for someone who wishes to reclaim his or her funds be as simple as possible, and no more complicated than withdrawing money from any account, albeit that the money will have been transferred to a central fund.

Those points notwithstanding, I support the motion.

I support the motion, although I am not overly enamoured or enthusiastic about some of the principles underlying the Bill. Some of my Finance and Personnel Committee colleagues and I have expressed our unease at the idea of the Treasury emptying anyone’s bank or building society account. It seems that the of raiding bank accounts has taken a different tack to the one that Northern Ireland has until now, from time to time, experienced.

I appreciate that there is a reclaim fund and that, although the money may have been taken and spent, people can still get their money back. The principle that people’s money remains their own is important, regardless of whether activity was last initiated 15 years previously.

On balance, it is best that Northern Ireland be included in the provisions of the Bill as it progresses through its various stages at Westminster. It is important that Northern Ireland and the Executive have the opportunity to influence what types of social and environmental purposes are funded. We must set those priorities for ourselves and in our own interests, rather than have a direct-rule-style diktat to tell us what is best for us.

I wish to reiterate concerns that I have raised in Committee, and which have been expressed by the Minister, about the body that it is envisaged will distribute any funds that are raised. Members will be well aware of the genuine and deeply held concerns of many individuals, as well as of some Church and community organisations, about dealing with the Big Lottery Fund. I know that the purpose of the Big Lottery Fund is only to manage money; however, impressions are important.

I encourage the Minister to continue his discussions with the Treasury to ensure that the branding of the distribution fund is distinct, and that it is made clear that it is not lottery money, thus making it easier for those who are concerned about using the proceeds of gambling to apply for the money.

It is important to take a realistic, pragmatic approach. I ask the Minister, in his summation, to elaborate on the possible consequences for Northern Ireland if the legis­lative consent motion were not passed, and if we were not included in the provisions of the Westminster Bill.

Go raibh maith agat, a LeasCheann Comhairle. Like my colleague Mitchel McLaughlin, I support the motion, which provides a legal framework to allow assets from accounts that have lain dormant for at least 15 years to be distributed to community causes through the Big Lottery Fund.

Many bank and building society accounts lie dormant and unclaimed, often because the account holder has died, or because surviving relatives have expressed no claim. Several countries operate similar schemes whereby moneys from such accounts are reinvested in the community.

The Bill has already become law in England, Scotland and Wales, and there is similar legislation in the South of Ireland. Although social and environmental themes are the main priorities, individual regions can decide for themselves to what causes assets will be distributed. The Bill will allow for money in dormant accounts to be transferred to a reclaim fund. That means that any individual, or any individual’s relatives who are still living, can — should they wish to do so — make a claim from that fund for the return of that money.

An alternative scheme is available for smaller banks and building societies allowing them to transfer an agreed proportion of a dormant account into a reclaim fund and to distribute the remainder to charities that benefit the local community.

I want to reiterate Members’ concerns about certain aspects of the legislation, which I share. These moneys should be additional to lottery funding and should not affect lottery distribution. They must also be separate from departmental funding. A number of safeguards must be implemented so that an individual or a living relative can reclaim the moneys at any time and that banks do not simply wait for owners to come to them but are proactive in seeking the whereabouts of those owners.

In order for accounts’ assets to be distributed equally and fairly, and in a way that is accessible to all community and voluntary organisations, safeguards should be put in place so that local priorities can dictate where the money goes. It is important that the community and voluntary sector is involved in any consultation on how that distribution of assets is progressed.

As other Members have said, the moneys would be much better put to use in the community than lying dormant in bank accounts. Therefore, I support the motion. Go raibh maith agat.

Like other Members, I support the motion.

When this issue was first brought to the Committee for Finance and Personnel, other members and I had certain reservations, to which I will refer. However, those reservations have now been dealt with, thanks to the Department and the Minister’s assurances.

I found the concept of the Government’s raiding private individuals’ bank accounts somewhat distasteful; it seemed to be a typical Treasury wheeze to extract additional money. Nevertheless, there are counter-arguments that point to these measures being necessary. From a philosophical viewpoint, the legislation resembles a latter-day updated version of the parable of the talents, in which an owner who has buried, or neglected, money is punished by having that money used for the common good. Similarly, moneys realised via legislation governing dormant accounts will be distributed in a way that benefits good causes.

Had Northern Ireland decided to exempt itself from this legislation, it is clear that, in a best-case scenario, the resulting procedures might not have suited us. If the Assembly negatives the motion, the worst-case scenario would be that we run the risk of simply being excluded completely. The amounts of money that will flow into Northern Ireland will be relatively limited, but they will benefit us overall. Therefore, from a practical point of view, Northern Ireland must be included in the scheme.

I was concerned that the intention was to operate the scheme through the National Lottery in the rest of the United Kingdom. Therefore, I am glad that the Minister has assured Members that the scheme will be administered in Northern Ireland separately from the National Lottery. When the Minister makes his winding-up speech, it might be worthwhile if he would outline how the scheme would be administered here if Northern Ireland were to be excluded from the legislation, or if, for some reason, the Assembly were to negative the motion. Christian and charitable organisations have problems with National Lottery funding that would preclude them from benefiting from the dormant accounts scheme, so I would welcome the Minister’s assurances today that the scheme will be marketed and administered differently in Northern Ireland.

I had concerns about people being deprived of their hard-earned savings, albeit savings that had lain dormant for quite some time. Members have been assured that there will be a consolidated fund, so that if claims are made at any stage, they will be honoured and people will get their money back.

On the basis of those assurances, and from a practical viewpoint, Northern Ireland will benefit as a result of the measure. Therefore, I support the proposal.

I support the motion. Dormant accounts are an interesting phenomenon, which many of us will never come across. Nevertheless, accounts can lie dormant in building societies for many years and for various reasons — perhaps when an individual dies his or her family may not be aware of additional accounts, or perhaps people have stashed unauthorised funds in accounts. If the accounts remain dormant for a significant period — that is, many years — the one group that benefits is the banks. Why should banks benefit from money in accounts of which the owners have passed on or cannot be identified? Therefore, I understand the reasoning behind the proposal in the motion.

It is important that there is sufficient protection for those who, at a late stage, are identified as account owners. I am content that there will be a totally independent fund, which will be able to secure payment in that case. The proposal makes sense; it is better that local people, instead of politicians in London, have an input in setting local priorities.

At the Committee, I raised the view that there should be a separation between this fund and any other funds in the Big Lottery, and that it should be identified as separate from gambling. Other Members supported that view, and I hope that that will help the Minister’s attempts to achieve that goal. I have come across many worthy groups in the community — such as the YMCA, which does good work, particularly with young people— that have been unable to apply for Big Lottery funding, which they would have been successful in obtaining, because of their beliefs. Any measure that increases the opportunity for such organisations to gain funding and improve their work in the community must be supported. I urge the Minister to ensure that — as far as possible — a separate fund exists, and that it is clearly identified as such. The many groups that have not felt able to apply for funding will then be able to do so in the future.

I state my wholehearted support for the motion.

I am pleased that Members have had a useful — albeit short — debate on the issue that the provisions in the Dormant Bank and Building Society Accounts Bill [HL] relating to Northern Ireland should be considered by the UK Parliament. A number of important points were raised and I will do my best to mention as many of them as possible.

I agree with the Chairperson of the Committee for Finance and Personnel, and his colleague, that the fund must be used in the community and must not be seen as a way for the Government to replace its funding. There were problems with additionality in Europe, and we will not go down that road. This is, genuinely, money to help our communities under the broad heading of social and environmental purposes. If the motion is passed, it will be up to the Executive to be more precise about the direction of the fund.

Several Members mentioned the ethical issues involved. When I was first contacted by HM Treasury on the matter, I wrote back and prompted a stream of correspondence on the issue. I was pleased that — when the Bill was in its final state of preparation — the Treasury made it clear in its response that unclaimed assets would be kept separate from lottery resources, with their own distinct branding and financial management arrangements.

HM Treasury saw that as a key principle.

Like many Members, I have faced circumstances in which communities were in great need but for ethical reasons I was not prepared to draw on lottery funds to ease that need. The dormant accounts scheme will allow those communities to benefit from our being able to give directions to the Big Lottery Fund, and I hope that many of them will do so. However, there will be no plaque on the wall to the Big Lottery Fund should people avail themselves of the scheme.

I was also asked about the consequences were the Assembly not to agree to the legislative consent motion. I do not get the impression from the Members to whom I have spoken that that will be the case, but, lest Members be teetering between decisions, I must inform them that the Treasury would still give the money to Northern Ireland, but it would be likely that the Big Lottery Fund would determine the funding priorities rather than their being set by the Executive and the Assembly. Therefore, those of us who want to see less of a role for the Big Lottery Fund will want to ensure that we proceed positively.

Dr Farry made a point about the risk of reclaim — he has gone. [Laughter.]

He is away to change his bank accounts.

They will all have gone dormant.

As some of my colleagues did, he referred to the risk involved for those people who, for whatever reason, have dormant bank accounts. They might have changed address or might not have needed the money for 15 years. Those people will be able to go as normal to their bank, where a fund will have been set up to ensure that they do not lose their assets.

The issue of a population-based share as opposed to a needs-based share was also raised. The Scottish and Northern Ireland Executives and the Welsh Assembly Government all took the same view — that a different formula should be used. However, financial services is a reserved matter, and the Treasury has not accepted that view. Some of our colleagues in the House of Lords and the House of Commons may attempt to table an amendment to the Bill. Nevertheless, any amendment would be Barnett formula-based, missing out some of our community’s needs.

I say to my ever-sceptical friend, Mr Hamilton, that this is not a case of the Treasury’s emptying bank accounts; the Treasury will not be emptying anyone’s bank account. The banks will operate the dormant accounts scheme voluntarily, so the Treasury will not get its hands on the money at all. The scheme will be operated independently, and the only Government role will be that that the devolved Administrations and central Government play in setting the spending priorities that are to be given to the Big Lottery Fund to allow it to distribute the funds.

Those are the issues that were raised during the debate, and I hope that I have not left anything out. I thank Members for their constructive contributions. It has been an interesting debate that will inform the setting of the scheme’s spending priorities in Northern Ireland and the direction that will eventually be issued to the fund distributor.

The dormant accounts scheme provides the mechanism to remove dormant accounts from the balance sheets of banks and building societies, and to reinvest them back into our local communities. If the House gives its consent to the motion today, that will open the door to an excellent opportunity for the Assembly to set priorities for distribution and to ensure spend goes to worthwhile projects across Northern Ireland. If that consent is not given, it will be a missed opportunity to set the spending priorities for our jurisdiction. Therefore, I encourage Members to support the motion.

Question put and agreed to.

Resolved:

That this Assembly agrees that the provisions in the Dormant Bank and Building Society Accounts Bill relating to the distribution in Northern Ireland of sums released from dormant bank and building society accounts should be considered by the UK Parliament.