July 19, 2010; Source: Huliq | One vexing problem that lawmakers can’t ever seem to find an easy answer to is how to finance their big ideas, especially when higher taxes aren’t the solution. Britain’s new Tory Prime Minister thinks he has a winning solution for how to pay for his “Big Society” initiative—an effort to help the country’s nonprofit and charitable organizations undertake social and community programs that the government can’t afford.
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In an announcement on Monday, David Cameron said some of these funds will come from a “Big Society Bank” that itself will be funded from accounts in U.K. banks that have been inactive for at least 15 years. “These unclaimed assets, alongside the private-sector investment that we will leverage, will mean that the Big Society Bank will over time make available hundreds of millions of pounds of new finance to some of the most dynamic social organizations in our country,” Cameron said in a speech in Liverpool.
Ironically, the ability of the Conservative leadership to create and fund its new bank is actually owed to a bill passed by the previous ruling Labor party that allows the government to use unclaimed funds in dormant bank accounts for what are considered social or environmental purposes.—Bruce Trachtenberg