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Expanded Dormant Assets Scheme Receives Royal Assent

The Dormant Assets Bill has received Royal Assent, unlocking up to £800m for use in charitable causes.

The new bill means the government’s Dormant Assets Scheme has been expanded to cover additional assets from certain pensions and investments.

Dormant assets held via vehicles including savings endowments, investment bonds, income drawdown and deferred annuities will now be made available for a range of UK projects through the scheme.

“We have supported the expansion of the Dormant Assets Scheme from the outset - this new law is excellent news for the good causes that are in line to benefit from additional funding,” explained Danielle Higgins of data management specialists, The Tracing Group.

The expansion of the scheme follows a four-year review, which the government said showed widespread support for expanding the scheme from bank and building society accounts to include assets in these new sectors. “The first priority will continue to be reuniting people with their financial assets," added Danielle, who works to trace gone away customers. “Where this is not possible, more businesses will 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.

Including defined contribution pensions in the scheme is still under consideration, although if they are included, the Association of British Insurers (ABI) noted that only pensions with a contractual end where the assets are held in cash and the customer or beneficiary cannot be traced would be in scope.

With Royal Assent received, the Dormant Assets Bill has become the Dormant Assets Act.

“We have supported the expansion of the Dormant Assets Scheme from the start and the industry looks forward to working with the Reclaim Fund to ensure onboarding works well,” commented ABI director of long-term savings, Yvonne Braun. "The industry will continue to work hard to find gone away customers. It is always the first priority to reunite customers with their dormant assets and customers will have a right to reclaim their asset in perpetuity.”

A consultation will be launched this summer to look at what causes should benefit to help level up opportunities for young people and communities across the country. Proposals include boosting investment in youth programmes, social enterprises and money management. Since the 2011 launch of the Dormant Assets Scheme, banks and building societies which signed up have released more than £800 million from dormant accounts that are open but have been inactive for at least 15 years.

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