Clause 26 - Meaning of “authorised reclaim fund”

Dormant Assets Bill [Lords] – in a Public Bill Committee am 10:00 am ar 11 Ionawr 2022.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Question proposed, That the clause stand part of the Bill.

Photo of Nigel Huddleston Nigel Huddleston The Parliamentary Under-Secretary of State for Digital, Culture, Media and Sport

Clause 26 names RFL as the authorised reclaim fund and provides the Treasury with the power to add, substitute and remove the name of reclaim funds from the Bill in the future, should that be required.

Photo of Jeff Smith Jeff Smith Shadow Minister (Digital, Culture, Media and Sport)

We accept the definition of authorised reclaim fund and Reclaim Fund Ltd being conferred with that status. It makes sense, I guess, for the Treasury to be able to add or remove companies as appropriate or as required. Can the Minister clarify as to whether he foresees that being used only in the event of Reclaim Fund Ltd ceasing to function or becoming insolvent, or whether he would wish to give several companies at a time the status of an authorised reclaim fund? If it is the latter, what are the merits of that process?

The clause also gives the Treasury the power to specify which assets a reclaim fund can manage through secondary legislation. We agree that is necessary but believe that any changes must be made following a proper and timely consultation and in line with the overarching principles of the Bill. That is the intention of amendment 5 to clause 29, which we will discuss shortly.

Photo of Nigel Huddleston Nigel Huddleston The Parliamentary Under-Secretary of State for Digital, Culture, Media and Sport

The hon. Gentleman is right; we will discuss some of those features later on in the Bill. The definition of an authorised reclaim fund came into effect under the 2008 Act. Since then, RFL has been the only company to fulfil that function and therefore plays an integral role in the scheme’s success. In recognition of that and given RFL’s new status as a Treasury arm’s-length body, the clause names RFL as the only current authorised reclaim fund for the purpose of the dormant assets scheme. Naming RFL as the only authorised reclaim fund in that way prevents additional competing reclaim funds being set up without Treasury consent and ensuring that the reclaim fund for the scheme is fit for purpose and is essential in maintaining the principle of customer protection.

The clause allows the Treasury to remove RFL as an ARF in the future, in case RFL ever became unable or unwilling to fulfil the function of a reclaim fund. It also enables the Treasury to add the name of a new reclaim fund to the Bill, should another reclaim fund ever need to be set up in the future for circumstances which, again, we may not be aware of at the moment. The clause also gives the Treasury the power to specify which assets a reclaim fund is responsible for managing. As for some of the other features mentioned by the hon. Gentleman, we will discuss them later.

Question put and agreed to.

Clause 26 accordingly ordered to stand part of the Bill.