Closure of Santander Banks

Angela Crawley Excerpts

Thursday 7th February 2019 Commons Chamber

[Angela Crawley (Lanark and Hamilton East) (SNP)]

I thank those Members who have stayed behind for this important debate. The Lanark High Street branch of Santander is just one among 15 branches in Scotland that will be closing their doors. The Lanark branch will close on 4 July this year. That news has come as a shock to many of my constituents who rely on their local branch.

For the people and businesses in Lanark who depend on the face-to-face service they get in their local branch, especially those who are elderly, vulnerable, or live in the rural parts of Clydesdale, the nearest bank is in Lanark, so the closure of the branch is not just an inconvenience but a blow to the community, bringing new challenges for a town centre that is already struggling. Many local businesses depend on having quick access to their bank, and the closure will cause difficulties for many businesses in not only the town centre but the surrounding areas. For some customers, without the branch there will be no reason to visit the town centre at all, which is ultimately bad news for the local economy—footfall in shops, restaurants and cafés on Lanark High Street will drop.

I am sure I am not alone in this House in trying to tackle the decline of town centres, and I am sure many Members will agree that bank closures will only worsen the situation on our high streets.

[Mary Glindon (North Tyneside) (Lab)]

I congratulate the hon. Lady on securing this debate. For customers, as she says, it is not just the banks but the other shops on our high streets that will be affected. Taking away this resource does not help older people or people who do not want to use internet banking.

[Angela Crawley]

That is exactly why I have secured this debate. It is important that the Government provide answers on how they hold these businesses to account, especially big businesses like Santander.

I have continued to campaign actively on town centre decline and regeneration in areas such as Hamilton and Carluke. The consequences of further closures of banks and high street stores in the Clydesdale area cannot be overestimated. The wider impact they would have on Lanark are all too obvious and cannot go unrecognised.

Santander wrote at the end of last month to inform me of the decision to close its Lanark branch, with the rationale being that its internal review had found the branch to be no longer viable. However, anecdotal evidence suggests that it had already removed key services such as specialist mortgage advice and financial advice from many of its branches during the internal review.

According to the letter, 89% of customers using the branch are also using additional ways to complete their banking. That includes 26% using another Santander branch and 53% using online or mobile telephone banking. I fully accept that the changing nature of the digital economy and the increased use of online banking have changed how we use branches. However, Santander’s own figures suggest that it is content to let down the nearly three quarters of customers who are unable to travel to another bank and who rely on that service, and the nearly half of customers who do not or cannot access their bank online or through their phone.

[Mhairi Black (Paisley and Renfrewshire South) (SNP)]

The Santander branch on Renfrew High Street is the sixth bank branch to close in the last three years across Renfrewshire. Does my hon. Friend agree that it is simply not good enough for banks to up sticks and leave without taking account of the digital and geographical constraints that are a reality for far too many of our constituents?

[Angela Crawley]

I wholeheartedly agree with my hon. Friend, who drives home the point of this debate. In my constituency of Lanark, the rural issues go to the heart of why these closures are so impactful and, ultimately, why we are calling on the Government to do something about it.

This Government have stood on the back of the financial industry for years, yet they have done little to regulate it, to the point where banks are now closing right, left and centre and nothing is being done to improve local economies. None of the measures being taken has considered the impact on rural economies.

[Liz McInnes (Heywood and Middleton) (Lab)]

I am grateful to the hon. Lady for securing this important debate. It has been announced that the Santander branch in Middleton in my constituency will close in July and that customers can use the Middleton post office, but the Middleton post office is earmarked for closure as well. I am grateful to her for bringing up the effect this is having on our town centres, which are dying.

[Angela Crawley]

The hon. Lady is absolutely right, and this is why we are drawing this issue to the Minister’s attention. I am sure he is cognisant of these issues, and I am keen to hear what he intends to do about them.

As I explained earlier, I am using Santander’s own figures, which show that 10% of customers exclusively use face-to-face services in the branch. They also suggest that Santander has used this internal review to make a series of decisions at board level that will have a huge impact on local economies across the country and on the livelihoods of the staff working in the branches marked for closure.

It is regrettable that Santander chose not to undertake a full consultation with staff and the local community. Instead, it will follow a process of writing to customers to tell them when their bank will close, without adequately consulting the customers and staff who will be hardest impacted by the changes. Clearly, this decision has been taken behind closed doors, in the hope that no one would try to challenge it. I have spoken about only one story of a bank closure in my constituency, but this picture has been replicated all across the UK, as we have heard from other hon. Members.

Santander has announced its plans to close 140 branches across the UK, of which 15 are in Scotland. I wrote to the Secretary of State for Scotland, who is in the neighbouring constituency, so he is only down the road, asking him to meet a cross-party delegation of MPs to discuss how he and his Treasury colleagues could come together to mitigate the effects these closures will have in Scotland. Unfortunately, he has written to me today declining our invitation and laying the responsibility squarely with the Treasury, so it is all on the Minister here today—he can blame his pal. I hope he will have no more platitudes for me today and will give my constituents real answers on how the Government intend to hold big business to account for its rupturing impact on local economies and towns.

I warn the Secretary of State for Scotland, who was once upon a time the only Tory in Scotland—he now has some friends: ignore these cross-party calls at your peril. The cross-party calls from the Scottish National party, Lib Dems and Labour are clearly asking him, although he is not here to answer—and the Treasury, the Department he believes should be answering—what will you do to help my constituents? Scotland will not forget those who have let it down, and Members on the Government Benches have failed repeatedly to live up to their responsibilities. These closures will put 1,270 jobs at risk and will likely cause 840 redundancies, as Santander expects to redeploy only a third of the staff.

This is just the latest crisis for bank branches in the UK. The consumer magazine Which? reported at the end of last year that 60 bank branches were closing each month in the UK. Santander alone has closed 230 branches since 2015. People are being left behind without proper access to services. Post offices and mobile banking trucks do not offer the same range of services or the same convenience as branches. Some people, particularly the elderly and the vulnerable, are unable to use online services. For people who live in rural areas such as Lanark and many other constituencies that will be affected by these closures, it can be a challenge to access banking services when branches close. The Santander closure in Lanark means that my constituents in Auchengray, Tarbrax and Woolfords will lose out on one of their relatively close services. This might mean that they have to travel into town and then for another hour on a train to get to the city to bank, or travel to their neighbouring town assuming that a connecting bus service is available.

Leaving aside the restrictions in digital connectivity faced by some of my constituents in rural areas, Santander has failed to take into account the wider ramifications that the closure will have. I must pay tribute to my constituency neighbour on the other side, the hon. Member for Rutherglen and Hamilton West (Ged Killen), for his work in campaigning to keep ATMs open in rural areas, which mitigates some of the effects of bank branch closures. I recognise that Santander has made a business decision based on changing patterns of banking, but there must be a better way than to simply pull the plug on branch services, especially for rural communities.

The issue of transport, which I have raised, and the built environment should also play a key role in big businesses’ considerations when they are making such decisions. I believe these are real problems, and I must ask the Minister: what steps will he be taking to halt the effects of these closures on our communities? If he cannot halt them, how will he hold businesses to account in the future? This will only continue to happen in many places. Santander is but one example. RBS was another, and I am sure many more banks will do similar things unless the Government clamp down. These closures will have a deflating effect on local economies across the country, especially in small towns and rural areas, and I wonder what effects the Minister thinks that will have on the UK economy as a whole, especially at this moment in time.

I accept that Santander has made a commercial decision, but I know also that its decision will have a huge knock-on effect on other businesses in the communities it serves, and I cannot just stand back and allow it to go ahead. I know the closures will negatively affect many people, including the elderly and the vulnerable in our communities. I know that our town centres will struggle to recover from the damage caused by losing yet another branch. Rural communities will be less connected than they currently are, and businesses will suffer from the loss of their local branch.

My hon. Friend the Member for Glasgow East (David Linden), who could not be here today, has secured a Westminster Hall debate on the subject, so I assure the Minister that we will not be going away and this issue cannot be ignored. As I have said, I accept that this is a commercial decision by Santander, but I urge the Minister to take any action he can possibly take to halt the effects or hold the banks to account for this closure and the many others that will affect towns and rural communities. I hope he will pay heed to the comments of all Members who have spoken.

--- Later in debate ---

[John Glen]

I will talk in a few minutes about the ways in which we have intervened to try to find solutions to the circumstances in which the hon. Lady’s constituents find themselves. As I am sure those Members who have spoken are aware, the UK financial services sector is a whole-UK phenomenon, and Edinburgh in particular is important to financial services. The Government want to protect the sector, which is why we do not make the direct intervention that some may be looking for.

The Government firmly believe that the impact of branch closures should be understood, considered and mitigated, where possible, so that all customers, wherever they live, can continue to access over-the-counter banking services. The first step is to ensure that customers feel informed and supported when a branch closes, which is why the Government support the industry’s access to banking standard. All the major high street banks have signed up to the standard, which commits banks to a number of outcomes when a branch closes. First, they commit to give at least three months’ notice of a closure and explain their decision clearly; secondly, they commit to consider what services can still be provided locally, and communicate alternative ways to bank clearly to customers; and thirdly, they commit to ensure that support is available for customers who need extra help to bank online or, where that is not possible, to access services at the local post office. The standard is not just a checklist that banks need to go through; it is about being considerate of customers’ concerns when a branch closes.

In the case of Santander, I am pleased to inform the House that it took a number of steps when announcing the restructure of its branch network. Not only did it proactively contact all customers, as per the requirements of the standard, but it set up a dedicated phone line for customer queries about the changes for the duration of the closure programme. Furthermore, its branch teams will be proactively contacting known vulnerable customers to ensure that they are properly supported and advised on how to continue to bank locally. This includes all customers over the age of 75 who have visited the branch in the past 12 months, as well as those customers who have sight impairments or mobility issues, power of attorney, or are known by the team to be vulnerable. Where needed, this support can include: walking customers to the post office to introduce them to the post office team and demonstrate how they can carry out their banking; introducing them to staff in a neighbouring Santander branch; or helping customers to switch their account to another nearby provider. The teams will also take the time to talk to vulnerable customers about how they bank, changing the frequency of their statements and ordering cash cards, and to demonstrate how to use ATMs and contactless cards.

I acknowledge the point made by the hon. Member for Central Ayrshire (Dr Whitford). My father died a couple of years ago and I have been trying to migrate my mother to do more of this stuff online, otherwise the burden falls to me. I recognise that there are limits to that process but, in this case, a great deal of sensitivity has been shown to help customers to adapt to the new environment.

[Angela Crawley]

I appreciate what the Minister has said about the measures that Santander has taken. It is very noble of the bank to offer to walk someone to a post office—or to take them on the train to Glasgow in my case—but I am not hearing from him what the Government are doing to regulate financial services when they continually close branches across the UK. That is what I want to hear from the Minister.

[John Glen]

I promise the hon. Lady that I will come on to talk about that. It is about the relationship between the banks and the post office in the instance where it is the last bank that is closing. I am not here to defend the commercial decisions of banks, but I do think that the measures taken in this case look quite comprehensive with respect to dealing with vulnerable customers.