Measures to release 880 million pounds from dormant assets to boost opportunities across the country

LONDON, 24 February 2022 /PRNewswire Policy/ --

Expanded scheme will use dormant funds from insurance, pensions, investment and wealth management, and securities sectors

- Public consultation will launch in the summer to consider good causes to benefit from additional 880 million pounds

- Proposals to include boosting investment in youth programmes, social enterprises and money management support

Youth activities, community projects and other good causes could benefit from an additional 880 million pounds, following government action to unlock cash tied up in dormant assets.

The Dormant Assets Scheme - currently used by 35 banks and building societies to release 800 million pounds - will be expanded to include the insurance, pensions, investment and wealth management, and securities sectors. The expansion of the scheme to unlock a further 880 million pounds is part of the Dormant Assets Bill which is expected to receive Royal Assent today.

A consultation will be launched this summer to look at what causes should benefit in England to help level up opportunities for young people and communities across the country. Options include supporting young people following the government's recently announced ‘National Youth Guarantee', helping the national drive to support people struggling to manage their money, growing the social investment market, and addressing long-term funding to improve social infrastructure through community wealth funds.

The move follows the government's recent Levelling Up White Paper which set out plans to spread opportunity and prosperity to all parts of the nation.

Nigel Huddleston, Minister for Civil Society and Youth, said:

"The expansion of this fantastic scheme will help change people's lives for the better.

"We are doubling the financial support it can provide to support our recovery from the pandemic and level up communities.

"I encourage eligible organisations to participate in this unique opportunity, which is also inspiring other countries, to contribute to positive societal change."

Since the launch of the scheme in 2011, participating banks and building societies have released more than 800 million pounds from dormant accounts which are open but have been inactive for at least 15 years.

Funds were released to the government-backed Reclaim Fund Ltd and directed to support frontline organisations in some of the most left-behind areas of the country. They have helped tackle social and environmental initiatives helping young people on the path to employment, problem debt and climate change.

The innovative scheme is now being replicated internationally, with Japan modelling its own new scheme on the UK's.

John Glen, Economic Secretary to the Treasury, said:

"I am really pleased that the Dormant Assets Act has secured Royal Assent, which marks years of close collaboration with industry.

"This Bill is estimated to unlock more than 880m pounds over time to benefit communities right across the U.K. I'd encourage as many firms as possible to take part in the Scheme, so that even more genuinely dormant funds can be put to good use."

The expanded Scheme will continue to have consumer protection at its heart, with participants' first priority continuing to be reuniting people with their financial assets. Where this is not possible, more businesses will now be able to voluntarily transfer dormant assets to Reclaim Fund Ltd. People will still be able to reclaim their assets in full at any time.

Earlier this month, the Government announced that communities and good causes across England have been allocated an additional 44 million pounds through the Dormant Assets Scheme. The funding will be used to tackle youth unemployment, expand access to investment for charities and social enterprises, and help improve the availability of fair, affordable loans to people in vulnerable circumstances.

In May 2020 150 million pounds was unlocked to support the UK's charity and voluntary sectors' critical work during the COVID-19 pandemic to tackle youth unemployment, expand access to emergency loans for civil society organisations and help improve the availability of fair, affordable credit to people in vulnerable circumstances.

SOURCE UK Department for Culture, Media & Sport