Advertisement
News

Government raids dormant bank accounts for £330m to aid vulnerable

Money sourced from accounts untouched for 15 years is being lined up to help the disadvantaged, including £135m to fund long-term accommodation for homeless people – but the cash could be lost if Brits ask for their money back

Up to £330 million will be recovered from dormant bank and building society accounts to help fund good causes, Minister for Sport and Civil Society Tracey Crouch announced today.

The money, which will be sourced using the Dormant Bank and Building Society Accounts Act to access open accounts untouched for 15 years, will be distributed over the next four years by Big Lottery Fund [BLF] and Big Society Capital [BSC].

And while it potentially frees up plenty of funds to invest in a range of courses, the government is legally required to return any money if the legal account holder asks for it to be returned.

From the full total, around £280m will be allocated to initiatives across England to help disadvantaged young people into work as well as tackling problem debt and providing housing for families and vulnerable people.

Up to £135m of this will be used by BSC, alongside private co-investment, to fund stable and long-term accommodation for vulnerable groups, including homeless people and those with mental health issues, while also giving local charities and social enterprises a boost.

Advertisement
Advertisement

A further £90m will be used to target projects that help disadvantaged young people develop initiatives to aid employment, alongside Department for Digital, Culture, Media and Sport, the Department for Education and BLF.

The remaining £55m will be awarded to financial inclusion initiatives to improve access to financial products and services for those on lower incomes.

The BLF will also make £50m available to causes in Scotland, Wales and Northern Ireland with specific uses to be determined by each devolved administration.

Sport and Civil Society minister Crouch said: “By unlocking millions of pounds from dormant accounts for a range of good causes, we can make a real difference to lives and communities across the country.

“This is part of the Government’s commitment to building a fairer society and tackling the social injustices that hold people back from achieving their full potential.

“I am grateful to the banks and building societies, as well as Reclaim Fund Ltd, for their work to free up these funds for good causes. Working in close partnership with the financial sector and civil society, we are determined to help create a country that works for everyone and build a Britain fit for the future.”

Following the introduction of the Dormant Bank and Building Society Accounts Act in 2008, Reclaim Fund Ltd was established by the Co-operative Banking Group Limited identify dormant accounts to become part of the scheme.

Since then, it is estimated that £1 billion of dormant accounts cash has been identified since the Act was formed with £360m making its way to good causes – a figure the government is pledging to increase to more than £500m by 2020.

Reacting to the £135m investment into long-term accommodation for vulnerable people as well as local charities and social enterprises, Big Issue Invest CSV project manager Archie Chappel said: “Continued access to capital for social businesses enables further impact to be delivered. Government provision of capital helps leverage financing and support from the private sector and allows new products to be created that service more types of social businesses.”

Advertisement

Change a vendor's life this Christmas

This Christmas, 3.8 million people across the UK will be facing extreme poverty. Thousands of those struggling will turn to selling the Big Issue as a vital source of income - they need your support to earn and lift themselves out of poverty.

Recommended for you

Read All
Winter fuel benefit cuts will send pensioners to hospital, DWP warned: 'It's a political choice'
a view from above of an older person with white hair eating out of a pot
Winter fuel payment

Winter fuel benefit cuts will send pensioners to hospital, DWP warned: 'It's a political choice'

Ghosts star Charlotte Ritchie: 'It's a tragedy people can't afford their essentials'
Charlotte Ritchie at Trussell food bank
Food banks

Ghosts star Charlotte Ritchie: 'It's a tragedy people can't afford their essentials'

'We'll have to get more militant': The real winners and losers from the farm inheritance tax debate
a tractor in a field
Farming

'We'll have to get more militant': The real winners and losers from the farm inheritance tax debate

Housing minister admits Labour's 1.5 million homes promise will be 'more difficult than expected'
Labour housing minister Matthew Pennycook
Housebuilding

Housing minister admits Labour's 1.5 million homes promise will be 'more difficult than expected'

Most Popular

Read All
Renters pay their landlords' buy-to-let mortgages, so they should get a share of the profits
Renters: A mortgage lender's window advertising buy-to-let products
1.

Renters pay their landlords' buy-to-let mortgages, so they should get a share of the profits

Exclusive: Disabled people are 'set up to fail' by the DWP in target-driven disability benefits system, whistleblowers reveal
Pound coins on a piece of paper with disability living allowancve
2.

Exclusive: Disabled people are 'set up to fail' by the DWP in target-driven disability benefits system, whistleblowers reveal

Cost of living payment 2024: Where to get help now the scheme is over
next dwp cost of living payment 2023
3.

Cost of living payment 2024: Where to get help now the scheme is over

Citroën Ami: the tiny electric vehicle driving change with The Big Issue
4.

Citroën Ami: the tiny electric vehicle driving change with The Big Issue