Pressure from leading building societies, including the Skipton, could enable them to use cash from dormant savings accounts for local good causes rather than putting it into a national charitable pot.

The Government is proposing large banks and building societies should donate money from accounts which have not been used for 15 years or more to the Big Lottery Fund.

But this idea has been rejected by the House of Lords, thanks to West Yorkshire peer, Lord Shutt of Greetland.

His amendment to the Dormant Bank and Building Society Accounts Bill means the UK's eight largest societies, including the Skipton and Bradford-basedYorkshire Building Society, could continue focusing their charitable efforts on local causes.

In the Government's first defeat of the current parliamentary session, peers voted by 195 to 141 to reject the original proposals that would require those banks and building societies with assets of £7 billion and above to give money from dormant accounts to the Big Lottery Fund.

The defeat came at the Bill's report stage and ministers are expected to ask MPs to reverse it when it goes to the Commons.

The Bill allows money lying dormant in bank and building societies to be "reinvested in the community", according to ministers. But it ensures that owners can reclaim their money at any time.

Lord Shutt told peers eight of the UK's 59 building societies would be affected by the amendment. Most of the "big eight" already had their own charitable foundations and preferred to contribute locally rather than to the general scheme.

He said: "It is right to free all building societies from being part of that general fund and to let that which has been built up from local be used in a local way."

The campaign against the Government's proposals was led by the UK's largest building society, the Nationwide and supported by the Skipton Building Society. Jennifer Holloway, the Skipton's head of media relations, said: "We welcome this development in the Lords and would hope the Government accepts the amendment. We would prefer to use the money from dormant savings accounts to benefit local charities and good causes that are relevant to our members rather than put the money into a large national pot. This is why our branches each have access to funds for use in their local communities."

The Skipton Group, including its subsidiaries, annually donates around £600,000 to charities and local community causes.