The Labor government's controversial 2012 decision to change the period of inactivity before unclaimed money is transferred to the government from seven to three years is under review. This week Treasury issued a discussion paper canvassing several options to improve the arrangement and calling for submissions.The unclaimed money provisions are aimed at preserving the value of money that might otherwise be lost.Under the 2012 changes, authorised deposit-taking institutions are required to transfer to the government all inactive accounts - that is, accounts that have not had a transaction other than interest accrue or fees deducted for three years or more.There are a couple of exemptions. Children's accounts are not affected until they have been inactive for seven years, and term deposit accounts are exempt.The regulations allow an account holder to notify their ADI that they are aware of the account and do not want it to be considered inactive.Life insurance companies are required to transfer to the government all sums of money payable on the maturity of a policy that are not claimed within three years of the maturity date.Details of unclaimed money transferred to the government are searchable on the Australian Securities and Investments Commission's MoneySmart website and can be reclaimed. At the end of last year the government was holding about A$710 million of unclaimed money.These changes caused disruption to account holders because of the big increase in the number of accounts declared unclaimed, and to industry because of the need to implement new systems and develop much more active administrative procedures. Treasury said in the paper that questions remain as to whether the three-year period was appropriate.It said: "It is not clear that the current arrangements strike the appropriate balance between re-uniting people with their money and the costs that the recent changes have imposed on the industry."Instances do exist where bank accounts that are effectively active are being declared inactive and transferred to the government."The paper canvasses three options: leaving the inactivity period at three years; extending it to five years; and putting it back to seven years.The paper cites research by stakeholders, which says that if the period of inactivity was extended to five years the number of unclaimed accounts could fall by half, which would be a substantial saving in terms of administration, and would not involve the same risk of loss that a seven-year period of inactivity poses.Treasury also wants feedback on whether other types of accounts could be exempted. These include foreign currency accounts, which involve additional compliance costs. The Minister for Finance has called for submissions by July 11.