Banks might use dormant funds

Indira Das-Gupta

The Treasury is considering letting banks divert the millions of pounds lying in dormant accounts to their own charitable programmes.

In his Budget, Chancellor Gordon Brown emphasised the Government's commitment to diverting assets that can't be reunited with their owners to good causes.

Previously it was thought the money would go to the Government and then he redistributed among charities or to the Balance Foundation.

But this week the Treasury confirmed there were ongoing discussions to decide what to do with dormant accounts, and that one possibility would be to direct the money to the banks' own charitable programmes.

John Low, chairman of Acevo, condemned the idea. He said: "We do not believe the banks should be able to use this money to boost their own records on corporate social responsibility or that it should be spent supporting the bank's charitable priorities rather than those of society as a whole."

- See Budget reaction, page 12

KEY POINTS

- Estimates of how much money lies in dormant accounts vary, but some put it as high as £20bn

- The Balance Foundation was set up last March to find ways of redirecting the money to good causes

- Legislation to redirect the funds in this way has been passed in Ireland - Irish charities have already benefited from more than £41.5m that was sitting unused in bank accounts.

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