NFPs Call for Unclaimed Monies Fund
29 July 2014 at 11:19 am
Australia’s "unclaimed monies" should be used to create a capital fund to support investments in the Not for Profit sector, a submission to the Federal Government says.
Not for Profit peak body, the Community Council for Australia, has made a submission to Government and met with Treasury Officials on the issue in response to the Federal Treasury’s Unclaimed Moneys Discussion Paper released in May.
According to the discussion paper, in the 2012-13 Mid-Year Economic and Fiscal Outlook (MYEFO) the previous Government announced changes to the treatment of unclaimed money in relation to unclaimed bank accounts, unclaimed life insurance money, unclaimed first home saver accounts, lost superannuation and unclaimed company moneys.
The paper sought comments from stakeholders on what changes account holders and industry believe could be made to the unclaimed bank account and life insurance provisions to better balance the benefits of the scheme, with its regulatory cost.
CCA hosted a roundtable discussion for Not for Profit leaders on the issue earlier this year.
“The Australian community wants to see a fair and transparent process in dealing with unclaimed monies from dormant bank and superannuation accounts,” CCA Chief Executive Officer David Crosbie said.
“While we recognise that unclaimed moneys are a community asset that needs to be preserved and available for anyone claiming their money back, there is nothing to stop some of these funds being used to underwrite real investment in the Not for Profit sector that will benefit the whole community.”
In its submission CCA said: “If we can create an additional capital pool for the Not for Profit sector it will deliver real economic and social benefits for governments and our communities in the longer term.
“The community would support the diversion of unclaimed moneys into a fund that is transparent and achieves real social benefit.
“Unfortunately many banks and other financial institutions have difficulty engaging with or underwriting the Not for Profit sector as risks are not always as easy to identify and quantify.
“In an ideal world, there might be a ‘stock market for good’ where investors interested in achieving various social outcomes and impacts could invest in the broad range of social programs, and organisations delivering better outcomes would be able to attract greater capital and deliver a greater social benefit.
The CCA submission sets out a number of conditions that would need to be in place before any funds could be made available to the sector including:
a. that the capital is preserved and is available to anyone seeking to claim back their unused moneys;
b. that the capital is not only preserved but is available to government within a reasonable time;
c. that any use of the funds should not only be revenue neutral but should also make a small positive return over time;
d. that the use of any funds is both transparent and accountable;
e. that there is a real and tangible benefit to the community from any investment made with unclaimed funds.
CCA said the submission also highlighted areas where unclaimed moneys might be invested in the sector such as: capacity building; underwriting mergers and collaborations, supporting the development of fundraising, sponsorship and income producing activities; and underwriting a phase down insurance type product to mediate rapid changes in government funding policies.
Crosbie said CCA was currently seeking a meeting with the Assistant Treasurer to discuss its submission.