Dormant Assets Bill [HL]

Earl of Devon Excerpts

2nd reading
Wednesday 26th May 2021 Lords Chamber

[The Earl of Devon (CB) [V]]

My Lords, it is a pleasure to follow the noble Baroness, Lady Bowles, and, before her, the excellent maiden speech of the noble Baroness, Lady Fleet, who is warmly welcome, particularly for her wisdom and support for music and the arts.

It is a rare treat to contribute to such a positive debate on a piece of legislation that finds widespread support across the House and the country. The dormant assets scheme has clearly been a success, as confirmed by the Dormant Assets Commission some years ago, permitting the distribution of hundreds of millions of pounds towards good causes in the categories of youth projects, financial inclusion and social investment. I understand that the expansion of the scheme to include insurance and pension products will allow potential access to over £2 billion of further dormant funds, so it is a great shot in the arm for the scheme and those good causes. I see that it meets the approval of the Association of British Insurers and that the financial industry more generally is supportive, too.

I note my membership of the All-Party Parliamentary Group for Social Enterprise. Dormant assets have played an invaluable role in the development of social enterprises over the past 10 years, and the sector is keen to ensure that they continue to do so. Social enterprises are critical to the levelling-up agenda; they ensure investment in people and projects across the United Kingdom and are often located in our most deprived communities, creating considerable employment and routes out of poverty. Since 2010, many millions in dormant assets have been invested this way, supporting more than 1,500 organisations, 82% of which are outside London.

The demand for social investment remains strong, particularly given the impact of the pandemic on our most fragile and vulnerable communities. Over the coming months, the social enterprise APPG will be conducting an inquiry, which I am honoured to be chairing, to assess the performance of the sector during the pandemic.

Over 5,000 new community interest companies have been registered since March 2020. Of particular importance to these institutions is access to long-term financing, which is exactly the support that the dormant assets scheme can provide. That is why this legislation is so important and why it is key that the Government consider the role of social enterprise in the context of the dormant assets scheme. To that end, can the Minister please confirm what level of engagement has taken place with the social enterprise sector in developing this updated legislation?

Given the importance of dormant assets to the funding of social enterprise, can the Minister confirm that their use for its development will not be diluted by this legislation? In particular, what assurances can the Minister give that social enterprises will remain a primary beneficiary of the use of dormant assets?

It is of particular concern that, under Clause 29, the Government propose to move the power to change the use of dormant assets from primary to secondary legislation. I know that the Government have committed to consult with the National Lottery Community Fund and hold a public consultation, but this is very different from requiring a change via primary legislation and, thus, debate in this House.

There also appears to be no obligation to consult specifically with the social enterprise sector, which is concerned that it may lose this crucial source of funding without consultation or the ability to voice its concerns. I ask the Minister to do what she can when she responds to put this very important sector’s mind at rest.