The Treasury has issued a policy consultation in which the Government is proposing to expand the dormant assets scheme. The government is proposing to expand the dormant assets scheme to include a wider tranche of otherwise idle assets which may be put to better use for good causes.
Context & proposals
A range of assets were considered for inclusion in any expansion of the dormant assets’ scheme based on genuine dormancy and particpants’ willingness to transfer them. The new scheme would likely include - dormant bank accounts, insurance policy proceeds, share proceeds and unit proceeds (all dormant). Investment asset proceeds and distributions would also likely be included, as would certain other dormant asset distributions.
Expending this scheme would also need to provide proportionate improvements to consumer protection, also NALC is minded to highlight in a short response:
- That many so called assets which principal authorities transfer to local councils are in fact liabilities and dormant assets should be exempted from being transferred to local councils as a result of local government re-organisation and new council creation;
- Local councils still have to pay business rates on public conveniences they own or manage (whether these are assets or liabilities) so the Treasury should consider as part of this consultation how it intends to factor into the scheme physical assets such as public conveniences which principal authorities do not want to run and which local councils cannot afford to manage to the toilet tax and other financial burdens; &
- That local councils still also have to pay business rates on many other assets or liabilities they own or manage (such as village or community halls for instance). The Government should also consider when wider physical liabilities in parished areas which are not owned by a principal authority or a local council – become dormant – how they are managed locally and financially.
NALC will be responding to the below consultation questions and is interested in the sector’s views:
Question 1: Do you have any comments on the proposed scope of assets in an expanded scheme (subject to ensuring tax neutrality) ?
Question 2: Do you have any comments on the proposed definitions of assets? These definitions should be read in the context of proposed definitions of dormancy and eligible participants; &
Question 6: Are there any other assets that the government should consider for inclusion in an expanded scheme?