Charities to get £150 million boost from dormant accounts

Cash from dormant bank accounts is to be used to help charities and social enterprises desperate for cash during the pandemic.

The government has released the money from accounts which have not shown any activity since 2008.

Vulnerable

As well as a range of charities, the cash will also be used to support those on the government’s ‘vulnerable’ list such as food boxes and carers for those still in self-isolation.

Money will also be provided to Fair4All Finance who provide struggling households with an alternative to high cost loans.

Youth

The Youth Futures Foundation will receive £10 million to launch an Emergency Levelling Up Youth Fund to support young people from hardest hit communities.

It will further expand their development and impact grants programme to rapidly increase youth employment provisions.

Big Society Capital will receive £45 million to allow better access to investment including emergency loans for charities, social enterprises and some small businesses facing cash-flow problems and disruption to their trading.

The Foundation for Social Investment will benefit from £30 million to support social enterprises helping people in vulnerable circumstances.

A vital role

Announcing the initiative, Culture Secretary Oliver Dowden said: “Charities and social enterprises are playing a vital role in our national effort against coronavirus.
“This funding will support organisations that are at the heart of their communities, building on our unprecedented package of financial support for the voluntary sector.

Dormant assets scheme

“Through our proposals to further expand the dormant assets scheme, we want to unlock hundreds of millions more pounds for good causes, while keeping customer protection at the heart of the programme.”

The scheme began back in 2011 and since then over £600 million has been distributed to good causes

Community Support

More support is to be made available through a new Coronavirus Community Support Fund which has been given £750 million which will be distributed by the National Lottery.

A government statement on the additional initiative said: “£200 million worth of grants will be available for organisations who are supporting people and communities experiencing disproportionate challenges and difficulty during the pandemic, and those that provide services and support for vulnerable people and have seen an increase in demand or have lost income.

“Further funding will be committed and informed by emerging priorities, as the impact of the pandemic on vulnerable groups and charities is understood.”

Unprecedented

Economic Secretary to the Treasury, John Glen, said: “This funding will provide vital support to some of the most vulnerable in our society, and comes on top of the unprecedented package we have put in place to help individuals, businesses and the economy through this difficult time.

“Thank you to the banks and building societies for taking part so we can continue to support so many good causes.

I look forward to the potentially millions more we can unlock for good causes through expanding the Dormant Assets Scheme.”

Consulting

The government is currently consulting on yet another project to release funds from dormant assets from the insurance and pensions, investment and wealth management, and securities sectors.

Insiders say it has the potential to make billions more pounds available.

Money back

The government says consumer protection is at the heart of the whole scheme with priority being given to reuniting people with their money.

If a consumer later realises they had a dormant account which has been appropriated they will always be able to get their money back.

A spokesman said: “Only where reuniting people with their money is not possible, following repeated, unsuccessful efforts to locate the asset owner, will funds be released to support good causes.“