Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2009

On the timetable, the scheme is conditional on this secondary legislation taking effect. If that is achieved, the FSA needs to bring forward details of its proportional, prudential framework for the scheme. The reclaim fund will need to apply to the FSA for authorisation once the necessary legislation and FSA rules are in place. We are looking for the scheme to be operational as soon as possible following authorisation of a reclaim fund. The Government hope that the scheme will be launched as soon as possible this year. From that, the noble Baroness should draw no conclusions as to the timing of a general election; the two matters are clearly totally unrelated. When will the fund get money? The industry is publicly committed to the scheme. As soon as the reclaim fund is set up and authorised by the FSA, we expect dormant accounts to run through the scheme. Great preparation has been carried out by the industry in that respect. The noble Baroness also asked whether there could be more than one reclaim fund. In theory there could be more than one, but we do not envisage it. The industry’s willingness throughout—I include here the building societies and the banks—to support this initiative has been very clear. I have engaged frequently with leaders of the industry at chief executive and chief operations officer level to discuss their support for the scheme. There is still important work to be done in establishing the reclaim fund and I shall be emphasising tomorrow at the British Bankers’ Association annual conference the importance that society will place on banks being seen to play an effective role in supporting community programmes and initiatives, if not least of all in response to and recognition of the significant support that the banking industry has received from the state over the past 12 months. The amount of money that will flow into the scheme is still a matter for considerable conjecture and I am not sure that a great deal can be added to earlier estimates given when the House discussed the matter. The figure given at that time was somewhere north of £400 million but, quite frankly, it could be a great deal more. We shall simply have to wait and see. However, whatever happens, it is money that will no longer remain dormant in the deposits of banks but will be used for good purposes as Parliament intends. The noble Lord, Lord Newby, inquired about regulation costs. The FSA levies are a matter for the FSA, but I shall pass on the noble Lord’s comments to the FSA and add my own emphasis by saying that this is a simple scheme which should therefore be reflected in a low cost of regulation and supervision, and that the FSA can make its own contribution to ensuring that the purpose of the Act is recognised by the way that it supports and supervises the fund. The FSA has already consulted on the draft rules for its prudential regulatory framework for the reclaim fund. Publication of its final rules and regulations, as well as setting up a reclaim fund, is contingent on passing this secondary legislation. The Government believe that the FSA will publish its final rules and regulations shortly. It is already available to engage with candidate reclaim funds on a pre-application basis in order to expedite the process of setting up a UK dormant accounts scheme once the legislative process is completed. The BBA and BSA are committed to leading on selecting a reclaim fund. Overall, the Government intend that a UK dormant accounts scheme should be operational as soon as possible. I believe that we all eagerly anticipate the launch of a UK dormant accounts scheme and I commend the order to the Committee. Motion agreed.