A Social Investment Bank

A Social Investment Bank

Consultation Paper
by The Commission on Unclaimed Assets
July 2006

Appointed by the Chancellor, Gordon Brown, last December, the Commission on Unclaimed assets has decided that the UK’s national priority is poverty – typically entrenched in areas of multiple deprivation beyond the reach of private sector investment. This concise interim report recognises that without enterprise and wealth creation, we can’t build resilient and sustainable communities. Here is the Executive summary and background, with a link also to the full document:

The full 10 page report is available here in pdf: http://www.unclaimedassets.org.uk/CUA_report_16pp.pdf  

Executive Summary and background

The United Kingdom is a wealthy country. . Yet the increases in wealth over the last 25 years and the interventions from Government have not been able to reverse severe inequalities in income and prosperity. .1 Those on the margins live in a society characterised by accelerating rates of change and new forms of poverty and deprivation.

This calls for sustained action and an ambitious vision for the future. We need to reconnect disadvantaged and marginalised communities with enterprise and wealth creation. We cannot afford our youth to be brought up without hope or expectation as young people offer the best hope for breaking the cycle of deprivation and exclusion.

The social sector, often referred to as the third sector, is well-placed to meet this challenge. Its organisations have a significant presence in affected communities and provide essential services and support. . But funding for the sector is often restrictive and inflexible, stifling creativity and growth. A more sophisticated funding system is needed for the third sector to thrive and for it to provide the necessary support to enable these communities to prosper. 

The release of unclaimed assets from UK banks, building societies and other financial institutions provides a unique opportunity to boost the third sector. The Commission has been looking at spending options for the unclaimed assets. We believe that using the assets as a traditional endowment or spending the capital over a shorter period would have little impact on disadvantaged communities.

Our strong sense is that this is a sector that needs to be grown patiently over a longer period of time. Too much money too soon would result in poor decisions and wasted funds.

We propose using the unclaimed assets to set up an independent financial institution that would act as a wholesaler and distributor for the third sector. We have called it the ‘Social Investment Bank’. It would work with specialist distributors directly and indirectly to channel this capital where it can have the biggest impact. We want it to provide financial and advisory support to the third sector to help expand its activities. We want to create a marketplace that develops its own dynamic momentum and turns social investment into a recognised asset class.

This paper will detail the issues and expand on our proposal to set up a ‘Social Investment Bank’ funded by unclaimed assets. . Following the publication of this paper, we intend to consult widely on our proposals, before producing a more detailed report before the next Budget. .An effectively funded third sector could make a major contribution to regenerating our deprived communities, improving financial inclusion and realising the potential of our disadvantaged youth.


Unclaimed assets are monies that have been untouched by their owners in financial institutions for a considerable period of time. Countries including the US, Ireland, Australia, New Zealand and Spain have legal frameworks in place for putting these assets, including dormant accounts, to productive use. The Commission on Unclaimed Assets has been set up to propose recommendations for the UK.In parallel, a British Bankers Association (BBA) and Building Societies Association (BSA) organised industry working group are developing proposals for a regulatory and legislative framework on dormant accounts, in consultation with the Government. This is still a work in progress. The Commission will review these proposals and will focus on three main issues:

Consumer protection: account holders must always be able to claim their assets, including any interest due, regardless of when they come forward to claim them.
Effective regulation: the proposed regulatory framework needs to be sufficiently robust to ensure compliance without placing an unnecessarily onerous administrative burden on financial institutions.
Unrestricted capital: Whilst any transferred capital would be subject to a future claim by account holders, the capital should be free of other ties so that it can be used to leverage other resources for disadvantaged communities.

The full 10 page report is available here in pdf: http://www.unclaimedassets.org.uk/CUA_report_16pp.pdf