Overview of the Act
- The Dormant Assets Act ("the Act") takes forward the Government's commitment to expand the Dormant Assets Scheme. The Dormant Bank and Building Society Accounts Act 2008
("the 2008 Act") limits the scope of the Scheme to dormant bank and building society accounts, and provides no opportunity to expand it without primary legislation.
- The Act enables an authorised reclaim fund, which administers the Scheme, to accept a wider range of dormant assets, including certain assets in the insurance and pensions, investment and wealth management, and securities sectors. A dormant asset is a financial product, such as a bank account, that the customer has not used for many years, and which the provider has been unable to reunite them with, despite efforts based on industry best practice. The Act also introduces a power for the Secretary of State or the Treasury to expand the Scheme to broaden the pool of eligible dormant assets in the future.
- The Act also amends the approach for distributing dormant assets funding in England, aligning it with the model used for Scotland, Wales, and Northern Ireland. The 2008 Act restricts the English portion of dormant assets funding to youth, financial inclusion, and social investment. The Act removes these restrictions and introduces a power for the Secretary of State to make an order to determine the social and environmental purposes for which, and the kinds of person to whom, dormant assets money can be distributed in England. The measure includes a statutory requirement to consult before making an order, and no changes to the existing restrictions can be formed until or unless a new order is made.
