Finance: Labour promise on dormant cash

Labour's manifesto includes a commitment to a measure that would force banks to distribute money in dormant accounts to good causes.

The party says that over the course of the next Parliament, banks will be expected to reunite unclaimed assets with their owners or "channel them back into the community". The announcement raises hopes that between £15bn and £80bn lying in dormant bank or building society accounts could be released to charity.

The manifesto promises: "We will work with the financial services industry to establish a common definition and a comprehensive record of unclaimed assets."

But the document does not expand on speculation that a future Labour Government would allow banks to transfer unclaimed assets to their own charitable foundations.

The NCVO said it was pleased to see that Labour had adopted one of the proposals from its own election manifesto.

Labour MP Martyn Jones, who has campaigned for the UK to copy existing legislation in Ireland, where money from dormant accounts is given annually to charities, said: "No longer will these institutions be able to treat this vast vault of cash as their own."

Since Chancellor Gordon Brown announced last year that banks would have to deal with the issue of unclaimed assets, ministers have had what they call "constructive discussions" with the banking industry.

KEY POINTS

- Labour has promised to force banks to distribute money left in dormant accounts to charities

- The announcement raises hopes that between £15bn and £80bn could be handed over

- Ministers claim to have already had "constructive discussions" with the banking industry.

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