Dormant Bank and Building Society Accounts Bill [HL]

From the previous debate and this one, it seems to me that the difficulty we are in arises from Clause 1(2)(b), which states that, "““the customer has against the reclaim fund whatever right to payment of the balance the customer would have against the bank or building society if the transfer had not happened””." There is a similar provision in Clause 2(2)(b): "““the customer has against the reclaim fund whatever right to payment of the balance the customer would have against the bank or building society if the transfers had not happened””." If I am reading the Bill correctly, it transfers the contractual obligation from the bank or building society to the reclaim fund. My noble friend argued that that lessens the security of anyone who originally had a claim against a bank or building society but now has a claim against the reclaim fund. We need an explanation of why the Treasury has chosen to transfer the contractual obligation from the banks and building societies to the reclaim fund. The obligation could have been left in the original contract with the bank or building society and, as has been suggested before, the reclaim fund could have been made an agent that holds the money and sends it back to the bank or building society only if the bank or building society says that it has found that the contract still applies and that it has to make a repayment. The bank or building society would trust that the reclaim fund had kept enough money to meet the repayments, which we all know are bound to happen. That is not the way the Bill has gone; it has transferred the contractual obligation from the original holder of the debt to the reclaim fund.