Community Bank Closures

Baroness Anderson of Stoke-on-Trent Excerpts

Thursday 8th February 2018 Commons Chamber

[Ruth Smeeth (Stoke-on-Trent North) (Lab)]

I beg to move,

That this House recognises the vital importance of community-based banking; believes that national banks have a responsibility to their customers; is concerned about the effect of branch closure announcements by Lloyds Bank, RBS/Nat West, Santander, Yorkshire Building Society and the Co-operative Bank; and calls on the Government to support measures to protect access to banking services in local communities in the UK.

I thank the Backbench Business Committee for granting this timely and incredibly important debate and the hon. Member for Hazel Grove (Mr Wragg) for co-sponsoring it. I thank colleagues for their support; the number of those in the Chamber on a Thursday afternoon just before the recess demonstrates how important this issue is to us and the communities we represent.

Like many colleagues, I am angry and frustrated, as are my constituents. In the past three months, the three towns I am so privileged to represent have all had bank branch closure announcements, ripping the financial heart out of them. So what on earth is happening? The high street bank has played a fundamental role in our local economy and communities for generations. It has been a rare constant in the ever-changing landscape of our market towns and city centres.

Those bank branches have provided and continue to provide a vital function for local customers, whether it is the pensioner withdrawing her money for the week, the local business depositing the day’s takings, or the young family looking to take their first step on to the housing ladder. Madam Deputy Speaker, I am sure that you can remember, as I can, being taken into a bank by a trusted loved one to sign up for a first account—a big moment. For me, it was a NatWest account with a ceramic piggy bank and, as I proudly represent the Potteries, how could I not celebrate the fact that my piggy bank was a genuine Wade—Woody, made in Burslem?

These cherished childhood memories for so many of us might sadly not be available to the next generation. For millions of people up and down the country, the services that local branches provide are as necessary as they have ever been, but they are disappearing.

[Chris Elmore (Ogmore) (Lab)]

I congratulate my hon. Friend on securing the debate. My first bank was the Midland bank when I was 11, so I therefore discovered I had been a member of that bank for 24 years, much to my shock. On the question of shrinking bank services and millions of people being affected, following NatWest’s decision to close the banks in Maesteg and Pencoed there will be only one bank left in my whole constituency. That is 58,000 people within a geographical area with only one bank. Does my hon. Friend agree that that is a shocking failure of the banking system and that the banks are not following through on the community banking schemes that they are meant to be doing to serve communities?

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[Ruth Smeeth]

I completely agree with my hon. Friend, although I think many others will be astonished that he has had a bank account for that long. There is a genuine issue about the responsibility of community banking. When I got my first paying-in book, there were 20,585 branches across the country, but by 2012 that figure had dropped to just 8,837. In the past three years alone, we have seen a further 1,500 branches close, and that does not include the announcement of further closures made in the past three months.

The hole that these closures leave behind goes far beyond an empty shop front. For the elderly or disabled, a 3 mile journey to the nearest branch is more than inconvenience. In my constituency, Burslem, Kidsgrove and Tunstall are all facing the loss of well-used local bank branches and the impact on local residents and local businesses will be severe. In Burslem, we are currently facing the prospect of losing our very last bank branch, a local Lloyds. Burslem is the mother town of the Potteries, as I am sure the whole House is aware. It is home to Burslem School of Art and the Wedgwood Institute, to Port Vale football club and the outstanding Titanic brewery. Yet if these plans go ahead, there will no longer be a single solitary bank. What message does that send to a community that is doing everything it can to support local businesses and improve our town centre? When did community banking become a phrase devoid of meaning?

In Kidsgrove and Tunstall, Co-op customers are faced with the prospect of losing their local branches—the last remaining Co-op banks in my constituency. As a Tunstall resident and a customer myself, I know how popular the branches are and the impact that their disappearance will have. Walk into any one of these branches at virtually any time of day and people are queueing. They are used by hundreds of residents as well as local businesses.

Petitions against the closure have already attracted thousands of signatures, and residents have contacted me about what the closures will mean for them. I must thank Councillor Kyle Robinson for leading the campaign in Kidsgrove, collecting more than 1,200 signatures so far, as well as Tom Simpson, Lucy Kelly and local traders in Tunstall and Tunstall market for their incredible efforts, as well as the wonderful June Cartwright for co-ordination of the Our Burslem campaign.

The closures will have an immediate effect and impact on people’s lives. I have heard from elderly constituents who use the Tunstall Co-op branch and will be forced instead to travel 3 miles via unreliable public transport to a city centre with no public conveniences. For people in their 70s and 80s, or those with a disability, this is more than an inconvenience—it is a genuine struggle.

That was brought home to me by a story from a constituent whose parents have used the branch for many years. They are not technologically savvy— a weakness I, and I am sure others across the House, share—and they find it difficult to use an ATM or to pay for things in shops using their debit cards. If the House will humour me for just a moment, I want to quote what my constituent had to say about this matter:

“My parents are 81 and 83 years old and have used the Co-op bank in Tunstall for many years. The staff know my parents very well. They are exceptionally helpful, supportive, patient and ensure that they understand everything that they need to. Knowing that my parents have this level of support when I’m unable to be there every day, provides me with a great deal of reassurance, and I’m extremely grateful for this.”

I am sure that we all know people who benefit from this level of personal service and for whom the faceless and bewildering world of online banking simply will not work. In fact, in my great city too many of my constituents do not even have access to the internet. In the past three months, the Office for National Statistics suggests, up to 51,000 people, or one in four, aged over 16 in Stoke-on-Trent have not accessed the internet. One in four. For the record, that is more than double the national average, which makes talk of internet banking as the panacea for this crisis nonsense for too many people.

For businesses too, the closures present a challenge. For those who trade primarily in cash it is neither safe nor practical to expect staff to travel halfway across the city to deposit the day’s takings. And for small businesses with a limited number of employees, the time that this will take out of their day is a real hindrance. One of the defences often given in advance of such closures is that nearby ATMs will continue to be available, yet hundreds of them are at risk of being closed down thanks to the proposed overhaul of the LINK network. What is more, the services provided by external ATMs are incredibly limited, even compared only with the automated services available in bank branches.

The Post Office provides a valuable service, and in 3,000 locations—soon to include Burslem—it is the last banking retailer in town. But its ongoing restructuring process has seen too many branches close in recent years and we do not know what the future holds. Of course, although the Post Office can support customers looking to withdraw or deposit cash, it cannot provide the same range of services and advice as a bank branch.

[Ged Killen (Rutherglen and Hamilton West) (Lab/Co-op)]

Does my hon. Friend agree that many people are not necessarily aware of the services available in post offices? If they are, they do not always want to do their banking in, for example, a local shop—where a lot of post offices are now based—because it might be busy.

[Ruth Smeeth]

I could not agree more with my hon. Friend. In fact, one of my concerns is that no assessment is made of whether local post offices have the capacity to deal with these issues when a bank in a community closes, and there is no communication with those post offices.

Britain has often been described as a nation of shopkeepers, so what does it say about us if we are unable to maintain the national banking infrastructure that our small traders need? There is a safety aspect to these closures as well. Should the final Lloyds branch in Burslem close, the only remaining ATMs will be inside shops. There will be no external ATMs available in the town and nowhere to withdraw cash after closing time. If I were to go for a drink in Burslem one evening, and as the vice chair of the all-party beer group, it would be impolite not to—

[James Frith (Bury North) (Lab)]

You’re propping it up.

[Ruth Smeeth]

Absolutely. If I were to go for a drink, there would be nowhere for me to get cash out to pay for a taxi home. For many young women—I am not sure whether or not I still fall into that category—

[Madam Deputy Speaker (Mrs Eleanor Laing)]

You certainly do.

[Ruth Smeeth]

Thank you very much, Madam Deputy Speaker. For many young women on a Friday night, the prospect of walking all the way out of town to a petrol station’s cashpoint may leave them vulnerable and afraid.

All that is merely a snapshot of the human impact that the decline in community bank branches is having on communities like mine. I am deeply concerned about what will happen to our towns should these branches disappear. I had hoped that the banks would share, or at least understand, that concern. Instead, when I met representatives from the Co-operative bank, which is no longer associated with the Co-operative Group, my concerns were dismissed and ignored. When I pointed out that the bank’s impact assessments were riddled with obvious inaccuracies, its representatives merely shrugged and said that it would make no difference to their decision. They treated me, and by extension my constituents, with contempt. They should be utterly ashamed of themselves.

The Co-operative is a bank that once distinguished itself by its commitment to ethical finance, so tell me, what is ethical about leaving a community without a lifeline and ignoring its objections? What is responsible about providing an incompetently researched impact assessment that cites nearby alternative branches that closed down a year ago? What is caring about hearing the concerns of 80-year-old men and women who have used a local branch their whole lives, and simply saying to those people, “The world has moved on—there’s an app for that now”? Let us be clear: a bank that treats people in that way cannot claim to be a “community” anything and should be embarrassed even to try.

As the statistics demonstrate, the problem is not limited to north Staffordshire. It is a national problem, certainly, but that does not mean that the hardship is evenly distributed—far from it. University of Nottingham research found that between 1995 and 2012, the areas that suffered the largest decline in branch numbers were

“characterised by unemployment rates and levels of renting from the public sector that are far above the national average”.

The researchers concluded that

“the least affluent third of the population has borne the brunt of two thirds of net closures.”

The people making those decisions might call it the reality of market forces, but I call it abandoning the people and communities that need those services the most. Whatever we choose to call it, the facts remain the same: the poorest and most vulnerable people in our country—especially those in rural or inner-city areas—are frequently discriminated against in the banks’ decision making process.

The social cost of excluding low-income consumers from mainstream financial services can be severe, and could even risk driving people into less legitimate but more visible and convenient methods of financing, including loan sharks, legal and otherwise. The costs of these closures go beyond the individual; they have long-term repercussions for the whole community. The Campaign for Community Banking Services has argued that bank closures contribute to the commercial decline of an area, as better-off consumers change their purchasing habits and begin to shop, bank and even socialise further afield. Worse still, closures are associated with a real decline in local bank lending. Growth in lending to small and medium-sized enterprises is dampened by an average of 63% in postcodes that lose a bank branch, and that figure grows to 104% for postcodes that lose the last bank in town. The impact on our high streets, on our local businesses, and on future regeneration can be devastating.

What does all that mean for towns such as Burslem, where local people are coming together to lift their community up and push back against years of decline? There was a time when the local bank was thought of as the heart of the community—perhaps it still is—so what happens to a community when it loses its heart? What happens when the monetary circulation of a town is cut off mid-beat? What happens when the last financial lifeline disappears and leaves the elderly and vulnerable without support? The world we live in is not the same as it was 10 years ago, let alone 40 or 50 years ago. Times change, technologies change, and we must change with them. But we must also do more to ensure that as the world moves, we do not leave behind those who find it hardest to keep up. We must recognise that there remains a place for community banking, local lending and face-to-face advice. That means we need the banks to take some ownership and responsibility for their loyal customer base. They need to be imaginative and consider sector and community-wide solutions, not pass the buck and blame their customers. If they will not do it voluntarily, we will have to force them to.

The banking sector has options. Banks could launch community banks that share counter facilities, like they do in parts of Spain. They could invest in multi-functional ATMs so that customers can pay in money directly, in their local communities. They could fund more extensively community-based financial education to assist people with online banking. They could even fund access to broadband in some of the harder to reach communities, so that their customers could access online banking. Yet all we have had from the sector is silence. We need to ensure that our banks are working in everyone’s interests, not just their own.

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[Caroline Flint]

I absolutely agree with my hon. Friend. One would think that banks did not really want to foster demand for real branches, so the case for closure is made for them. They are creating a self-fulfilling prophecy.

Parliament needs to demand more from Government and more from the big five banks, beginning with support for local communities. While branches cluster in large cities in lavish offices, outlying towns and villages are being denuded of bank branches that are anchors for local businesses. We are told that the average customer travels just 2 to 2½ miles to their nearest bank branch. I worry about figures like that, because what they really mean is that the banks estimate all the access across the UK and then divide it, so of course the figures will be distorted by the density of branches in our cities.

[Ruth Smeeth]

I thank my right hon. Friend for making such a passionate speech on this subject. One of my issues with the journey times quoted is that I do not believe that any of these journeys have ever been done on public transport. The figures do not take account of how many bus changes may be needed, nor the fact that some of these places are not connectable on public transport. The numbers do not make sense. Does she agree?

[Caroline Flint]

My hon. Friend makes such an important point. There are so many assumptions about the way that people live their lives today that bear no relation to our own experience, let alone that of our constituents. In my constituency, people are 10 to 20 or more miles away from their nearest branch. We do not hear about the 10% to 20% of people across the UK who are in that situation. Customers in Thorne and Bawtry will each travel 10 miles if their NatWest branch closes. As my hon. Friend said, many of those people do not have access to a car. For many of my constituents, getting into Doncaster town centre takes at least two buses, and they are not necessarily running every five minutes—unlike the service that many of my friends benefit from in London and the big cities. The problem is simply not recognised.

Do the Government really wish to support our small towns to regenerate and develop? In both Thorne and Bawtry, the past 10 years have been tough, but—this is the irony—we are, I am proud to say, now seeing a renaissance in those towns. That is fantastic, but at this tipping point we are in danger of losing our last bank. It just does not make sense.

If we want to halt the growing gap between city and small town Britain, we need a policy to keep bank branches open in a more creative and sustainable way for the future. It cannot be right that towns with a population of 4,000 or 5,000 in the immediate vicinity, let alone the many thousands beyond that in even smaller villages, are losing not just the banking services but the presence of a face, rather than just a till, machine or counter in a convenience store for their financial needs.

Bawtry and Austerfield, which has 4,000 people, will soon have no bank. Strathaven is a market town with 7,500 people, Hornsea has 8,000 people, 40% of whom are over 60, plus thousands of tourist visitors every year, and Pencoed has 9,000 people—all those communities are soon to be left with no bank, and the Government need to do something about it. They could begin by collecting and reporting data on bank branches and the rate of closure, to face the uncomfortable truth about the loss of services in small town Britain.

The Government cannot be neutral on this matter. Their mandate derives from the British people, not UK Finance. This is not about neo-luddism. We are not anti-technology. This is about inclusion and equality. I urge the Minister and his Treasury colleagues to act before branch networks are a thing of the past.

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[Susan Elan Jones]

Yes, I would welcome that. I think that is a positive point.

We also have to consider what the banks have been telling us. My right hon. Friend the Member for Don Valley (Caroline Flint) spoke about some commercially sensitive information that she was not allowed to have. I, too, have asked for commercially sensitive information, such as how many people had accounts at the branch, and clearly the bank was unable to tell me. Better still, I asked how many people on a typical week went in with queries. I was told something earth-shattering: that queries might not really be queries. I asked what that meant. I was told that, if someone goes into a bank, stands at the counter and asks a question, that might not be a query. I made the point that, for the customer asking the question, it very much was a query. I was told that, if there was no formal transaction, it was not a query. It is a parallel universe.

As we move at this juncture, we need to know what on earth the banks are planning to do next. An hon. Member has made the point that first we were fobbed off by being told that one could go to the next village, and then to the next, and then to the next, and that it was all right because it is just a little walk down the road—rather like an old-fashioned countryside treasure hunt. Suddenly, one realises that one has to go quite a long way to get to the next post. That cannot be the way to deal with the problem.

What we do about cashpoints and ATMs is of utmost seriousness. There are currently some 70,000 in the country, the bulk of which are free to use. At the start of 2016, the then Chair of the Treasury Committee, Andrew Tyrie, said that cashpoint charging and closures were of great concern. His point was that, if the ATM companies were not going to deal with the problem, this House needed to look at it, because people in rural communities and those on low incomes would be affected the most. As far as I can see, one problem with cashpoints is that the 38 or so banks and the like that are part of the ATM network are having a little scrap with each other. As they knock metaphorical spots off each other, each deciding that they are all paying too much, it is the customer who loses out.

[Ruth Smeeth]

My hon. Friend may not be aware that the price of an average transaction has not increased for nine years. The service is not costing the banks any more money; they just do not want to pay for it any more.

[Susan Elan Jones]

Where charges exist, the average cost of a single transaction is £1.70, and it is worrying that we are not looking more at free access to cash, which is a basic right. We do not say that about drinking water or many other things. It is nonsense that we are prepared to let banks charge money for us to visit a cashpoint, and there is no doubt that charging hits the poorest communities hardest.

I want to give credit to some examples in my constituency of where people are fighting against the system. I do not know whether Members have ever visited Corwen, which is a fantastic town.

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[Craig Mackinlay (South Thanet) (Con)]

We have had a debate of extreme unity, between parties, between regions and between countries. It is fair to say that every MP in the House is concerned about the rapid closure of the banking network. I particularly wish to salute the hon. Member for Stoke-on-Trent North (Ruth Smeeth).

It feels like we are seeing a rapid change in high street banking, at a rate that I have never seen before. The reason for that is probably to do with us—the consumer. We have gone down the route that the banks have encouraged: taking the contactless route and using mobile and internet banking. We no longer use cheques for our transactions, because, first, we cannot find our cheque book, and secondly, we have to find an envelope and a stamp.

We have all fallen, probably rightly, for the seduction of the ease and speed of online banking. As my hon. Friend the Member for Chichester (Gillian Keegan) said very clearly, the volume of cash transactions in society is now below 50%. Even though we have the advance of the cashless society—I am sure that is warmly welcomed by the Treasury, because it means that most transactions can be appropriately taxed—it will be a very long while, probably a number of decades yet, before cash is completely out of the system.

There are a number of cash businesses; every constituency has them. My fear is that, when banking facilities move further and further away from those businesses, the amount of cash that is held in their premises and the homes of their owners, and perhaps in their safes, will become bigger and bigger, and with that will come security risks. There are security risks for the staff who are responsible for taking that cash to a bank that is increasing in size and further away.

[Ruth Smeeth]

One issue that has been raised with me by my constituents is to do with community groups that fundraise and hold big one-day festivals. They generate cash on that day, but, unlike businesses, which may be able to mitigate some of the problems, they may have volunteers who never have done anything like it before. That is a huge issue. Unfortunately, the post office will take cash deposits of only £2,000, which makes it even harder for them.

[Craig Mackinlay]

The hon. Lady makes the perfect point. My right hon. Friend the Member for Arundel and South Downs (Nick Herbert) said very clearly that, when charities hold grand county fairs, there may be temporary traders who do not have contactless facilities and will not at any time that I can foresee, which makes it a very cash-based business. There are also clubs and societies that rely on cash and cheques for the small transactions among themselves.

I recall, not that long ago—I do not want to single out NatWest for any particular criticism—an advert that said, “We are open all the time. We are keeping our branches.” It was criticising its competitors, saying, “Ah, look, our competitor banks have made your bank into a new trendy wine bar.” I am afraid that we are seeing far too many of those across the country. I recall very clearly that my first bank account was at Lloyds 33 years ago. That branch, which had been there for 50 years or more, is now a quite nice Cypriot restaurant. That highlights the point that the network is disappearing in my constituency in particular. Broadstairs has lost NatWest and Lloyds in this last year alone.

The hon. Member for Clwyd South (Susan Elan Jones) mentioned her petitions. I also generated a petition, and the regional director for NatWest very kindly came to my offices and I delivered it to him. I received the warm words, “We’re consulting.” But of course, the outcome was probably determined some time before the petition was even thought about. Sandwich, one of the best preserved medieval towns in the country, has lost HSBC, Lloyds and NatWest in the last 18 months alone. Broadstairs and Sandwich are both now left only with Nationwide, which I salute for staying true to its roots in service to the community and maintaining its branch network.

We have seen the banks retreat from the smaller communities into the major conurbations and shopping centres. I do not know the experience of other hon. Members, but whenever I pay in a cheque—my heart sinks when I receive a cheque in the post, because it means I have to wander somewhere to do something with it—the queues seem as long as they ever were.

Much has been said about the post office network, which is fantastic, but it is not always available and the queues are horrendous. The post office has closed in the small village of Ash in South Thanet—I say village, but it is getting towards town size, with a population of 3,500. We hope that the post office will be resurrected in a new branch or shop, but there is currently absolutely nothing available for the people of Ash, who are five miles from Sandwich, 16 miles from Canterbury and eight miles from Ramsgate.

Why do we not all use mobile apps and the internet? Well, that is all very well, but I do not want the elderly to be forced into accepting that type of banking, and people who have difficulties but are managing independent living need help with those kinds of facilities. My father is in his 80s, and is fit and well, but I do not want him to use mobile banking under any circumstances, because it is not uncommon for him to say to me, “Oh, I’ve had an email from Santander and I don’t even bank with Santander.” That is exactly the point. Many of us here, particularly those who are younger than me, are very internet-savvy and would recognise a scam banking email, but many of the elderly would not recognise it and might respond, giving up their internet banking details.

There are clarion calls across the House, mainly—dare I say?—from the Opposition, that it is up to the Government to do something. We often hear Members saying that the Government should do this or the Government should do that. In fact, we see it on the Order Paper on an almost daily basis. I do not think that this is a matter for the Government, although they can help to inform the debate. This afternoon, Members from all parties are saying loudly and clearly to the banks, “Stop what you’re doing and start thinking again about the communities you serve.”

Much has been said about the opportunity for joint banking facilities. That would be a very sensible route to take. I appreciate that a premises costs a lot of money, as it has to be heated and there are business rates, staff and security to pay. But surely three, four or five of the major banks could come together in some kind of grand banking hall, sharing facilities so that counter service is available. The call today is, “Banks, please do something.” They could also extend the availability of their mobile, caravan-type, irregular banking facilities that can go to smaller communities; I cannot see why that option should not be available.

We are all responsible for this situation. I am still a bit of a cash person. I even go into the bank and sign a cheque for cash. It was not many years ago that the cashier said, “Why don’t you use the cash point?” Of course, I do use cash points, but if I am passing the bank I often cash a cheque. I said, “Don’t put yourself out of a job. If more and more of us do that, you’re sounding the death knell of this branch.”

We see these changes here in the cafés in this House. I am always quite amazed that some of the younger people who work here will use a contactless card for their sandwich and a cup of coffee costing £1.90. I am not like that, but I can see that my own level of card use is increasing as the years go by. At the moment, I will use a card over the level of £20, but I am increasingly tempted to go for the contactless card under that £20 limit.

I recommend that Members encourage our constituents to get into the banks that still exist and use their counter facilities, because then the banks will not be able to say, “We’re closing because we’re not getting used enough.” The cross-party clarion call from this Chamber today has to be: “Banks, please stop. Let’s think again. Let’s work together. We want more joint facilities and more mobile caravan-type banking facilities going to our communities.” We can all do our bit by getting into the banks and using them.

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[Ruth Smeeth]

I thank the Minister for his response. I have a great deal of respect for him, and I wish him more luck with Lloyds tomorrow than I had. We need more clarity on a few issues, and the emphasis should be on the banking sector to resolve them, but if they will not act—so far, they have not—the Government and Parliament will have to act to hold them to account. The banks are not being imaginative, so we may have to make them.

The first issue is with LINK and access to ATMs. While I welcome the new announcement and what that may mean for access, the evidence suggests that 3,500 ATMs may close. Given what we are already seeing, that could be a challenge, so I urge the Minister to consider that more closely in addition to using the post office network. Colleagues across the House have agreed that face-to-face, personal contact is vital, and the post office network, while helpful, does not currently provide what we need from it. We also need to start talking about public transport infrastructure, so that people can access alternatives.

I thank the Minister for the debate and look forward to working with him on this issue.

Question put and agreed to.

Resolved,

That this House recognises the vital importance of community-based banking; believes that national banks have a responsibility to their customers; is concerned about the effect of branch closure announcements by Lloyds Bank, RBS/Nat West, Santander, Yorkshire Building Society and the Co-operative Bank; and calls on the Government to support measures to protect access to banking services in local communities in the UK.

[Phil Wilson (Sedgefield) (Lab)]

On a point of order, Madam Deputy Speaker. On 17 January, in moving my ten-minute rule Bill on tightening the regulations on private landlords, I should have declared that my wife owns two houses that she lets out. I regret that oversight, and I take this opportunity to correct the record.

Taxation: Beer and Pubs

Baroness Anderson of Stoke-on-Trent Excerpts

Tuesday 31st October 2017 Westminster Hall

[Mike Wood]

I think that is exactly what the Government have done over the past 12 months in changing the rules on permitted development in particular. Obviously, now we have to go through planning processes before pubs can be converted.

The licensees and customers at many of our pubs contribute in both a financial and practical manner to their communities, by funding and running sporting and other activities, such as football, darts, dominoes and cribbage, but also through community activities, a large number of which are run through our pubs. Of course, because pub customers are extremely generous people, initiatives such as PubAid are able to generate about £100 million each and every year for good causes in communities in all of our constituencies.

For all these pubs to flourish and remain at the beating heart of their communities, they need a transfusion of investment and custom that will come with a freeze in beer duty and a reduction in their business rate burden. I have set out why our beer and pub industry is so important economically and socially, but it faces the twin threats that I referred to earlier: the increases in business rates and in beer duty. The three duty cuts, last year’s freeze and the ending of the escalator secured about 20,000 jobs, boosted confidence in our brewing and pub businesses and meant that more beer was sold than would otherwise have been the case, boosting the Treasury’s total tax take, if we include both direct and indirect taxation. On business rates, the Chancellor has already recognised the pain caused to pubs by the disproportionate burden caused by valuation based on turnover; about half of that turnover may be beer duty and VAT that the pub is collecting on behalf of the Government.

The £1,000 pub relief announced in the March Budget is extremely welcome, particularly for smaller and medium-sized pubs. However, it is particularly important that that relief is now expanded and extended, because our pub sector pays nearly 3% of all business rates despite making up just under 0.5% of business turnover. It is hugely, disproportionately overtaxed through business rates.

[Ruth Smeeth (Stoke-on-Trent North) (Lab)]

Does the hon. Gentleman agree that it is ludicrous that pubs in Stoke-on-Trent pay more in business rates—in fact, more in total—to the Exchequer than Amazon does in its entirety? Stoke is paying more than Amazon.

[Mike Wood]

I could not agree more. The revaluation of business rates was often seen as an issue that affected only businesses in London or the south-east. As for everyone else, it was thought that some gained and some lost out, but that is completely untrue when it comes to pubs, which have experienced huge increases in every part of the country. The 27 pubs run by Black Country Ales across the west midlands and neighbouring counties will have experienced an increase in their rateable value of, on average, 40% by the time the transitional period is over.

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[Mr Nigel Evans (Ribble Valley) (Con)]

It is an honour to follow the hon. Member for Keighley (John Grogan), who is such a champion of the pub and beer industry, and to serve under your chairmanship, Mr Owen. During the last vote, I bumped into the Chancellor of the Exchequer. I said, “Chancellor, come down to Westminster Hall and listen to the debate on the beer duty,” and he smiled. I assume he is not here because he has rushed back to No. 11 Downing Street to pore over a spreadsheet and work out how much extra he can earn for the industry by reducing the taxation on beer—and also how popular he can become with each 1p reduction.

It is also a pleasure to be here with the former chairman of the all-party beer group, my hon. Friend the Member for Burton (Andrew Griffiths), who managed to have three successive 1p beer cuts and a freeze under his chairmanship—no pressure, then, on my hon. Friend the Member for Dudley South (Mike Wood), the current chairman of the beer group!

I get criticised for always prattling on about the pub that I live next door to, the Swan with Two Necks. In an emergency, I can be in that pub in three seconds. I will correct that today by mentioning three other pubs that serve the community that I represent. Alex Coward, the landlord of those pubs, is with us today and has lobbied me about the importance of cutting the beer duty. There is the White Bull at Alston, the White Bull at Gisburn and the Alston Arms at Longridge. I have eaten and drunk in all three of those pubs at some stage. Alex told me about all the charities that they support, from the Brittle Bone Society to the Air Ambulance, to Macmillan, as well as Longridge juniors and Longridge town football club and the local Joanne Smith Wareing cancer charity.

We know that pubs are a focal point for a lot of occasions, such as christenings, funerals, birthdays or just for people coming together. That is how important they are. The current chair of the all-party beer group went through a list of reasons why local pubs are important to the community, so I do not need to repeat those, but I want to stress a number of things about how important the local pub and brewing industry happens to be.

I hope that the Government will look at lower taxation on lower gravity beer. They tried an experiment on beer of 2.8% or less, but it has not taken off. People have not flooded to taste that beer, but I believe there is an audience for beer that is between 2.8% and 3.5% in strength. We are told that the Treasury would love to do it but that it cannot because of the European Union. Well, the good news is that we can all rush to our pubs post-March 2019 and celebrate our leaving the EU, but there are things that the Treasury can do, such as introduce a new rate of 2.8% and 3.5% and have a different rate of taxation on it. I have legal advice stating that the Government can do that, so I hope the Treasury will look at that.

We have argued for lowering the taxation rate generally. Every 1p that it was reduced by in the past created 4,000 more jobs in this area. Let us look again at business rates, which are going to clobber a load of pubs. I am a member of CAMRA. Twenty-one pubs are closing every week and that is a huge loss to the community, particularly when the pub is the only one in a community. It can have a savage impact.

[Ruth Smeeth]

As the hon. Gentleman knows, I am a proud representative of the Titanic brewery in my constituency. For the record, there is no better beer, but it also has a small pub estate, and its business rates have gone up by 37%. That is £70,000 a year that it can no longer invest in its estate or in its people. Surely at this point we need to reflect on what is really happening in the beer industry and what is likely to happen to pubs.

[Mr Evans]

The Treasury really has to take this issue on board. Business rates, the living wage and other costs that are heaped on the brewing and pub industry mean that this has to be looked at carefully. Pubs are closing. I mentioned Alex Coward, who employs 45 people in the local community, and we represent a semi-rural, or rural, area. These are vital jobs in those areas.

A lot of pubs play music and pay their licence under the Phonographic Performance Limited licence. A lot of pubs are now receiving a new notification. If they have a TV on the wall and show live TV—not just the sport, but something else—they are being asked to pay a minimum of £100. The larger the pub, the more they will be asked to pay. As a lot of people have mentioned, it is cheaper for someone to buy beer from a supermarket and then sit at home alone watching a big TV. How miserable is that! We need to do more to incentivise people to use pubs. If that means lowering taxation on pump-pulled beer compared with beer that someone buys in a pack—12 bottles or 24 cans—we need to do that. I am told again that that can happen when we leave the EU in March 2019, and I hope the Treasury will look at it.

Public Sector Pay Cap

Baroness Anderson of Stoke-on-Trent Excerpts

Wednesday 5th July 2017 Commons Chamber

[Elizabeth Truss]

My hon. Friend points out the impact on the overall economy of unsustainable increases. We need to look at the overall package for public sector workers, including the reduced taxes that most public sector workers are paying and improvements in areas such as training, and we need to ensure that any pay raises are sustainable.

[Ruth Smeeth (Stoke-on-Trent North) (Lab)]

I am sure the Chief Secretary agrees that public services are the backbone of our country, but the average full-time public sector employee will have lost £4,073 in real terms by 2020 because of this Government’s decisions. Does she think that that is fair?

National Spitfire Project

Baroness Anderson of Stoke-on-Trent Excerpts

Tuesday 28th March 2017 Westminster Hall

[Royston Smith (Southampton, Itchen) (Con)]

I beg to move,

That this House has considered funding for the National Spitfire Project.

A national monument to the iconic Spitfire is long overdue, and in moving this debate, I hope the House will also consider the 100th anniversary of the Royal Air Force. It is a pleasure to serve under your chairmanship, Mr Davies. The Spitfire, like me, was made in Southampton—I always have to get that in. The prototype was designed by the famous aeronautical engineer—he was also one of the country’s most successful apprentices—R. J. Mitchell, at the Supermarine factory in Woolston, which is situated in the east of the city and the heart of my Southampton, Itchen constituency.

[Ruth Smeeth (Stoke-on-Trent North) (Lab)]

While Reginald Mitchell was one of Southampton’s most famous apprentices, he was one of my constituency’s most famous residents. Does the hon. Gentleman agree that we have an opportunity for a national celebration of Reginal Mitchell’s contribution?

[Royston Smith]

I agree with the hon. Lady that it is a national monument that we seek. I acknowledge that R. J. Mitchell was born in Stoke-on-Trent. In fact, it was where he started his apprenticeship. However, he designed the iconic Spitfire in my constituency of Southampton, Itchen, which is where I think the monument should be situated.

The Spitfire completed its maiden flight from Eastleigh airport, latterly renamed Southampton airport, on 5 March 1936. With a powerful and instantly recognisable Rolls-Royce Merlin engine and eight machine guns, it was a formidable fighting aircraft in its day. So impressed were the Royal Air Force with the prototype that the Air Ministry ordered 310 Spitfires to be produced at the Woolston factory in Southampton. By 1940, the factory was at full production, employing thousands of technicians and engineers to manufacture the Spitfire. The aircraft had to be built quickly to replace the many being lost during the battle of Britain, so the factory was working flat out. The Nazis knew that, and they also knew they had to stop it. The luftwaffe had been taking catastrophic losses—they estimated that they had lost nearly 1,200 aircraft between July and September 1940 due to allied action—so it was imperative for them to prevent the manufacture of British fighter aircraft.

September 1940 was Southampton’s darkest period of the war. On 15 September the Woolston factory was attacked by 15 luftwaffe bombers dropping 23 bombs. Fortunately, on that occasion they missed their target, but on 24 September 17 enemy bombers managed to reach the south coast and attacked the Itchen and Woolston factories. Two days later the Nazis redoubled their efforts and two waves of bombers got past the British air defences and dropped 60 bombs on the two Supermarine complexes. Both factories were destroyed, and as a result 110 people lost their lives and many more were injured.

The blitz on Southampton was devastating, and the city was hit over and over again, not just because of its Spitfire production, but because of its docks and many other strategic targets. There were 57 attacks documented in all, dropping more than 2,300 bombs. Nearly 45,000 buildings were damaged or destroyed, with most of the city’s High Street devastated. There were reports that the glow of the firestorm as Southampton burned could be seen from as far away as Cherbourg.

After the awful attacks on the Woolston Supermarine factory, the Nazis thought they had succeeded in halting production of the Spitfire. However, they underestimated the British spirit and stoicism, and not for the first time. Under the instructions of Lord Beaverbrook, production was dispersed to sites around Southampton, Hampshire and Wiltshire.

UK Economy

Baroness Anderson of Stoke-on-Trent Excerpts

Wednesday 29th June 2016 Commons Chamber

[Wes Streeting]

My hon. Friend has a great deal of expertise in this area and we take seriously his warnings. I would feel less aggrieved by what he says if it were not for the fact that in the run-up to the referendum these very questions were put to the Secretary of State for Northern Ireland. We were told, “Don’t worry”—which seemed to be the blank cheque; it was said with every promise of the leave campaign—and now we find that we should very much worry.

We should also worry about the reason people voted to leave the EU. Much of it was not about the Lisbon treaty or where decisions are taken. Many people, even with this British Parliament as sovereign as it is today—and as sovereign as it was last week by the way—still do not feel that they have control over their lives and their destiny. I would hazard a guess that when the analysis is done we will be able to map community by community those places that voted leave and those places that have had the hardest time because of the unequal nature of our economy. That should worry us more than anything else. Many people voted leave out of desperation, in the vague hope, in the belief that their circumstances could not be worse than they are today and that our immigration system and the flow of people into this country make them and our economy less well off, rather than better off. That concerns me deeply.

[Ruth Smeeth (Stoke-on-Trent North) (Lab)]

I represent one of the areas that overwhelmingly voted out. Thirty-six per cent. of my constituents earn the living wage and believe that this decision will increase their salaries, yet 7,000 of my constituents are employed in an industry that is already looking to see what happens next, is unstable and is stopping investment. Does my hon. Friend agree that we have to get strong answers from the Government to protect future investment?

Spending Review and Autumn Statement

Baroness Anderson of Stoke-on-Trent Excerpts

Wednesday 25th November 2015 Commons Chamber

[Mr Osborne]

I thank my hon. Friend’s Conservative council for the support it gives to the car industry, and I thank him for championing the industry in this House. We have made a commitment not only to maintain the money we are putting into our automotive strategy, but to continue doing so for the next 10 years. Obviously, product lines at JLR and other important car firms take many years to develop and invest in. I am sure that long-term commitment to our brilliant car industry will be very welcome.

[Ruth Smeeth (Stoke-on-Trent North) (Lab)]

Following on from questions asked by colleagues, led by my right hon. Friend the Member for Don Valley (Caroline Flint), will the Chancellor outline exactly what today’s autumn statement means for cities such as Stoke-on-Trent, sitting between Greater Birmingham and Greater Manchester, with little family silver to sell in terms of assets, and with 94% of my residents living in properties in council tax bands A, B and C? What are we meant to do without the local government block grant and with business rate revenue that will not fill the gap?

[Mr Osborne]

The reallocation of funding within local government continues to support poorer areas of the country such as that represented by the hon. Lady. There is now a huge set of incentives for the local community, local businesses and the local council to grow Stoke-on-Trent and see the benefits. They can work with us to make that happen. I am very happy to discuss what more we can do for Stoke and, of course, what more we can do to ensure that Stoke co-ordinates with Crewe and Cheshire East authority, which my constituency sits in and where there are lots of exciting plans to do more together.

Oral Answers to Questions

Baroness Anderson of Stoke-on-Trent Excerpts

Tuesday 16th June 2015 Commons Chamber

[Ruth Smeeth (Stoke-on-Trent North) (Lab)]

12. If he will maintain current levels of and entitlement to child benefit over the next five years.

[The Exchequer Secretary to the Treasury (Damian Hinds)]

As the Prime Minister pledged before the election, this Government will not cut child benefit.

[Ruth Smeeth]

In my constituency, there have been reports of children returning to school in September malnourished because their parents are struggling to afford to feed them. Does the Minister agree that cuts to either child benefit or child tax credit would exacerbate the problem and make the issue of holiday hunger even more common?

[Damian Hinds]

The Prime Minister has made this extremely clear by stating categorically that child benefit stays as is. The most important thing in regard to affordability and household budgets is to increase employment and ensure that people are in good jobs. The Government have also done an awful lot to bear down on household costs to make them more affordable.