Dormant Assets Bill receives Royal Assent

The Dormant Assets Bill has received Royal Assent, meaning the government’s Dormant Assets Scheme has been expanded to cover additional assets from certain pensions and investments.

The passage of the bill is expected to unlock up to £800m for use in charitable causes.

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.

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”.

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.

Policies and assets held under group trusts, including occupational pensions, are not in scope, alongside with-profit funds, personal trusts, and assets held by mutual insurers and friendly societies, among others.

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.

“More transparency in the scheme’s spending direction is still needed which we hope will be covered in the spending consultation later this year.”