Thank you to the Hon Member for Feltham and Heston for bringing this debate to the floor of the House – an issue we have debated many times in the two years I have served as the MP for Angus in this place.
To be frank – we are moving towards a cashless society too fast, when a large number of people are not yet ready. As Chair of the Access to Cash Review stated “If we sleepwalk into a cashless society, millions of people will be left behind.” My constituency has lost 12 banks between 2015-2019 - I have lost RBS, BoS, Clydesdale, Santander and reduced hours in TSB since my election in June 2017. The acceleration is concerning, and I strongly believe we cannot leave this to market forces any longer. We have to intervene.
I wish to raise three main areas today:
- Impact on rural areas
Because they are suffering at a more extreme rate than urban. When a branch closes, those communities cannot just adapt. Poorer transport links to get them to next branch, poor connectivity for digital options or phone banking, fewer cash machines and the easy target for the big banks.
My constituency, like many rural areas, has a high percentage of 65+ who reside there. These are the people who are most affected – their weekly trip to the bank may have been their only personal interaction, don’t trust phone banking, don’t feel privacy in tact in their local post office, and no access to broadband -whether they can reach a connection or not.
Banks are leaving all these people behind – the banks are turning their backs on our rural communities. 20% of the population live in rural areas yet only 12% of bank branches and 11% of cash machines are located there.
Rural communities also tend to have more deprivation – those who rely more heavily on cash. Financial inclusion, as noted strongly in the recent Treasury Select Committee report, cannot be understated. The World Bank said there can be no end to poverty without financial inclusion.
Banks are there to serve all consumers – but those in Angus where by only 83% of the constituency is connected with superfast – they immediate alienate the other 13%. Digitisation is not the solution – it is for some, but not for all and we have to stop accepting that can be.
The vast majority of Post Offices, for viability reasons, now are accommodated in small shops. We all know how we tightly squeeze in to send our parcels – there is no space for many of them for a personal private service and the banks direct you towards them but don’t monitor it thereafter. There is also ongoing concern, repeated yesterday, about the viability of many PO’s going forward – with 22% of sub PM’s to reduce or close in the next year. Why? Because the numbers don’t stack up. Why should taxpayers be backing up our PO’s in order to deliver a service our banks should be doing themselves. This system is not working – this is a short term solution, there are no back up plans are created by banks when their alternative banking option is also in real danger.
And if banks believe PO’s deliver the majority of the services – why does my constituency survery deduce that only 45% believe the PO delivers all the banking services they need.
The savings from bank closures are minimal – staff costs and building maintenance amounts to little when you look at profits released. Banks, who I commend, for looking at hours before closure – are also very timid to admit how much they’re saving from staff hour reductions. This has to be less about business interests and more about consumer needs.
- Access to cash
Accessibility to cash is another issue in this debate. We’ve seen a loss of free ATM’s across this country – eight in my constituency. Cash use may be falling – but we still see 60% of 18-24 year olds taking cash out 1-2 times a week. The group, that some banks would suggest, are completely digitised. This illustrates that we are a while off being a cashless society – and in order to do so, we have to have the infrastructure in place to get there.
I refuse to accept we should pay for our own cash – we cover tax on our income, fuel, electricity, council tax and if the SNP in Scotland had it their way, taxed on parking your car at work.
My High Streets are in difficulty – and they have been for many years now for a whole host of complex reasons. But the last thing my small businesses need is their local banking provision taken away from them, footfall and cash for transactions gone too. Card transactions cost a fee, which for small items removes any profit from the sale. We have to find a solution. Kirriemuir soon to lose its last bank in town – and I know if we don’t step in my other towns will follow.
We must try and buck this trend.
- Business hubs
We’ve seen Barclays banks, Lloyds and NatWest come together in Birmingham pilot business banking hubs. It is for this reason, and an initiative I commend, that we cannot continue to reject the same premise when it comes to our personal customers. But time and time again there seems no appetite from the big banks to come together to serve our communities.
Hubs could operate out of one building, keep choice of brands on our High Street, heighten competition, keep services local and ensure all consumers can access the type of banking they prefer to use – not be dictated by those who to be honest, generally don’t understand the lie of the land – the implications such closures have on constituents.
Without push from government, put into statute, I cannot see banks bringing themselves together work on such a proposal. Not one for more government regulation than is needed, but this is an area I will not continue to let slip way in front of my eyes, at a rate which is unacceptable, with such short term provision in place which does not best serve our consumers, our communities or the responsibility we all have to deliver services at the point of need.
This debate is not going to disappear, it will only ramp up – where we have cross party consensus this place can be powerful. Together, we will ensure our communities are served – just as they elected us to do so.