No-deal Brexit: Short Positions against the Pound

Catherine West Excerpts

Monday 30th September 2019 Commons Chamber

[Mr Clarke]

Tempting as it is to follow the trail laid down by my hon. Friend, I will content myself with saying that, just as I would not comment on the actions of individuals in my reply to an Opposition Member, I will not comment on the actions of individuals now. However, the idea that there are vested interests on only one side of the debate could clearly be contested.

[Catherine West (Hornsey and Wood Green) (Lab)]

One of the areas of the economy that the casino-style hedge funds will be betting against is the housing market. What assessment has the Treasury made of how many fewer homes will be built, and which section of the house building economy will be worst affected: renters, first-time buyers or pensioners?

[Mr Clarke]

To the best of my knowledge, we have not commissioned specialist advice on the housing market. If I am incorrect, I will ensure that that is set out in writing to the hon. Lady. It is very clear that the UK housing market is in its most robust condition for many years. Indeed, we are now building many multiples of the situation we inherited in 2009, when house building had well nigh stagnated. Of course, many of the problems faced in our housing market stem from the disastrous failure of the last Labour Government to build enough homes in the first place.

Breathing Space Scheme

Catherine West Excerpts

Wednesday 19th June 2019 Commons Chamber

[John Glen]

I am extremely grateful to my hon. Friend for those observations and for mentioning the Trussell Trust, which is headquartered in my constituency and has done a lot of work in this area. The principles underpinning the scheme are based on the Insolvency Service’s system and include all debts covered by the system. There are a small number of exceptions—for example, deductions for child maintenance payments—but we have designed this so that it is meaningful. It is not about a holiday from ongoing payments; it is about dealing with arrears and debt. The expectation is that when people join the scheme they will continue to pay for everyday expenses as they occur.

[Catherine West (Hornsey and Wood Green) (Lab)]

Is the Minister aware of Debt Hacker, a free online tool that I launched here in the House of Commons? It is run by activists and uses FCA rules that are poorly understood by the general public to help consumers to get back their £50—or however much it is—from companies that use extortion to get money out of others. Is he also aware, given his broader role in the Treasury, of the fact that it is mainly NHS and public sector workers who are in this debt trap, because wages have not kept up with housing, energy and other costs?

[John Glen]

The hon. Lady raises two points. I was not familiar with the Debt Hacker app, but I will seek it out because it sounds like a very worthwhile initiative. I respectfully say to her that in the fourth quarter of 2018 debt as a percentage of household income was 139%, whereas 10 years previously it was 160%. I recognise that households are experiencing strain, but it is not quite as dire as she makes out.

Santander Closures and Local Communities

Catherine West Excerpts

Thursday 14th February 2019 Westminster Hall

[David Linden]

Absolutely. Such is my friendship with my hon. Friend that we share a psychic bond. He probably knows that I will come on to speak about access to cash.

The Access to Cash Review’s interim report from a couple of months ago makes quite stark reading. Despite more and more services becoming cashless, approximately 8 million people—around 17% of the UK population—say that cash is an economic necessity for them. However, that 17% is not evenly spread. Scotland is much more open to economic damage from the transition to a cashless society than other parts of the UK. The statistics show that cash use in London declined by around 8.5% in the 2017-18 financial year, compared with only 3.3% in Scotland. Scotland is still much more reliant on cash, and it is therefore vital that we are not pushed to become cashless at the same pace as other parts of the UK. Quite frankly, that cannot and should not be forced on people, particularly some of our older, disabled or more vulnerable people.

[Catherine West (Hornsey and Wood Green) (Lab)]

As a London MP, I would like to see the figures broken down by ward. I am sure we would find that everyone uses a card in central London, for example, whereas many people in my constituency still rely on cash.

[David Linden]

That is a powerful point. I suspect that if we broke those figures down, we would see a different situation in Kensington and Chelsea from that in Hornsey and Wood Green. That point was well made.

Research published this week by the consumer champion Which? found that 339 Scottish bank branches have closed their doors since 2015. However, we need to remember that this is not only about branches closing. When banks leave, they all too often take cash machines with them, and at this stage I pay tribute to the hon. Member for Rutherglen and Hamilton West (Ged Killen), who I know has done a lot of work on the situation around ATMs.

The rate of loss of cash machines across the UK should alarm us all, with LINK reporting that the UK lost more than 2,500 free-to-use cash machines last year. Financial exclusion is soaring and is fuelled by the transition from cash, hitting certain sections of society harder than others. For example, I regularly make home visits to constituents with physical disabilities, who tell me they rely on taxis for their freedom. I do not know what it is like elsewhere in the UK, but few taxi companies in Glasgow accept card payments. I also still encounter many constituents who have had a struggle even to open a bank account in the first place, so we really cannot assume that everyone has a debit card. Some of these people will quite simply lose quite a big element of their freedom if they lose easy access to their cash. Others might even be driven to high-interest credit cards or pre-pay debit cards that charge people a fee simply for accessing their own money.

Mental health is also all too often overlooked. The Money and Mental Health Policy Institute report “Seeing through the fog” contains startling testimonies from people with mental health problems. One says:

“I find doing things face to face much easier and better for me. I hate doing things over the phone and can get quite anxious when doing so…I don’t trust online banking and will avoid this for as long as I can.”

Another says:

“I can’t handle the internet, I need human contact.”

Another respondent says:

“I need to see a person. I can’t cope with all this online banking stuff.”

It is little wonder that the institute’s evidence to the ongoing Treasury Committee inquiry into access to financial services concluded:

“Bank branch closures may particularly disadvantage people with mental health problems who struggle with remote methods of communication and rely on face-to-face support from firms to manage their finances.”

We cannot ignore people like this as society moves away from cash, and we certainly cannot treat them as collateral damage in the march of progress.

We have heard time and again that the UK is sleepwalking into becoming a cashless society, but that is no longer the case, because the evidence is there. We are here to discuss the issue today, and Ministers should listen and react, because we cannot afford to sleepwalk.

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[Catherine West (Hornsey and Wood Green) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Rosindell. I am pleased to follow my hon. Friend the Member for Plymouth, Sutton and Devonport (Luke Pollard), who always speaks with so much authority on matters not just in his own constituency, but across the piece.

The Santander branch in Crouch End in my constituency is one of the 140 scheduled to close. One hundred and forty is quite a large number and I am pleased to see how well attended the debate has been. I have heard from elderly constituents who are devastated by the news that the Santander branch is going to close. One constituent who got in touch is 88 years old. He is uncomfortable using computers and prefers to do his banking in the branch rather than online. He said that it is always busy when he goes there, but now he will be forced to get on the bus and travel all the way up to Muswell Hill. His friend changed her bank to Santander because her local bank branch had closed, and now Santander is doing the same. She is elderly and disabled and feels betrayed and let down.

I met with Santander bosses this week to express my opposition to the plans. At the meeting, I asked about the impact on staff. I was told that the branch has 10.8 full-time equivalent staff, and while they hope to redeploy some, there are no guarantees. In the meantime, the bank has put new staff on to short-term contracts, so that when those contracts finish, other staff can be put into those roles. That leads to lack of security in the workforce, something that many of us have campaigned very hard to counter.

The Communication Workers Union is working hard to defend its members nationwide. It says that the reductions to the Santander UK branch network place 1,270 workers at risk of redundancy and the bank expects to be able to redeploy only around a third of those affected, so hundreds of qualified hard-working employees will be out of work. Elderly and disabled customers will have to travel further to access vital services. Crouch End will also lose its ATM, so thousands of shoppers, workers and local residents will be inconvenienced.

Bank branches are disappearing at an alarming rate—a whopping 40% have closed since the Conservative Government came in in 2010. That is symptomatic of a wider problem in the banking sector, and is a quiet scandal that has seen many people lose their local services.

All too often, big banks have put their own profits above the needs of their customers. Think back to the origins of banking, with good banks, originally run by Quakers such as the Barclays; then look at the recent stories of Barclays, where the chief executive was forced to pay fines to the Financial Conduct Authority due to bad behaviour. Look at the banks flogging dodgy mortgages, a major cause of the crisis in 2008. Look at the LIBOR scandal or the exorbitant fees. We used to have bank robbers; now the banks rob us. We had foreign exchange manipulation. We had overdraft charges, ripping off customers. We had the payment protection insurance mis-selling scandal, which has been going on since 2005 and which I believe is at £40 billion so far—the shadow Minister may correct me. Furthermore, there are charges on withdrawing cash from ATMs, and operators fail to repair ATMs in a timely manner. Just how low can the banking sector get?

What can the Government do? Well, they could do much more. They are being a bit too laissez-faire, considering that closures of bank branches are landing blow after blow on the high street. The Minister will correct me if I am wrong, but I think there have been three reviews of the high street since 2010. Rather than launch just another review, why not play a key co-ordinating role between banks and stop the closures of Crown post offices, or at least support credit unions? I believe that another credit union has gone out of business this year because it was slightly overleveraged, and because so many people cannot afford to pay back very small loans. A number of small loans have led to certain credit unions not being able to survive. What are the Government doing proactively to support credit unions in areas where we know they can do so much good?

I would like to see a much more proactive approach. My colleagues mentioned the Labour approach to regional banks, which is a very good idea. I had a good look through the Minister’s written parliamentary responses to Members’ questions on bank closures and I have to confess that I found them mealy-mouthed—“Well, it’s the commercial decision of banks. We haven’t got anything to do with it.” Is that not the attitude that has got us into so much hot water since 2008? Have we learned nothing about the attitude of banks? Do they care about their customers? No, otherwise Santander would not be closing 140 branches. It might be acceptable to close a few, or to close the same number at a slower pace, but there will be 140 bank branch closures. Despite being in a different party, I completely agree with the hon. Member for Tiverton and Honiton (Neil Parish) on the dreadful treatment of customers, the fact that there is no personal approach to banking anymore and the fact that so many customers are being let down. I very much look forward to hearing some really innovative, far-reaching and radical suggestions from the Minister.

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[Mr Sweeney]

A rare collegial moment for the Chamber, perhaps. I agree entirely, and I was just about to come on to that issue.

When I met with Santander management last week to discuss the closure of the Springburn branch, I made the observation, “I recognise exactly why you’re doing this.” They did not deny it. I also said, “Yes, there needs to be total visibility about the economic impact and the disparity in terms of the demographics of where these bank closures are happening, because there is no visibility of that pattern.” This was recognised long ago: in the 1970s in America, there was a practice called red-lining, which involved American banks deliberately blacklisting poorer communities and withdrawing banking services.

In 1977, the Carter Administration passed the Community Reinvestment Act. As a result, commercial banks in America are obliged to redistribute their profits into sponsoring co-operative banking services and mutuals, and to promote credit unions. There is therefore a much more diverse range of banking services as a result of direct Government intervention to redistribute those services, which dates back to the 1970s. As a result of the Community Reinvestment Act, Santander will invest £11 billion in sponsoring co-operative banking, mutuals and other sustainable banking activity. That is a hefty redistribution and is in stark contrast with what happens in the United Kingdom, where there is no legislative imperative for banks to do it. We need to address that yawning chasm in legislation.

I made the point to the Santander management that the root cause of a lot of these problems is the increasing monopolisation of the banking sector in the UK. We have five major clearing banks, which hold 85% of all current accounts. By comparison, in Germany there are 400 local Sparkassen banks and over 1,000 co-operative banks. Clearly the picture there is very different, because there is legislation in place to redistribute the holding of capital in the banking system, so it is done more sustainably and is more responsive to local communities and to sectors of industry. As a result, Germany has a much healthier and more balanced economy.

I also made the point that Santander’s origins lie in the Abbey National, which was demutualised in 1989, the year I was born. We have seen a pattern of demutualisation across the banking sector, which has been negative for the UK economy. I would seek legislation to reverse the demutualisation of the British banking system.

[Catherine West]

Is it not particularly galling that a bank that used to be a building society with a sense of social conscience is inflicting this huge series of bank closures on our local communities?

[Mr Sweeney]

Absolutely. It is a stark example of the exploitation that we see on multiple fronts. We see it not only in universal credit, jobcentre closures and post office closures, but in things such as fixed-odds betting terminals and bookmakers being concentrated in poorer communities and high streets. We also see a stark contrast in microcosm in Springburn shopping centre. Right next door to the Santander branch is a branch of BrightHouse, which is a rapacious lender exploiting the poorest communities in our country. In my opinion, its practices should be illegal. It is just as bad as the payday loan lenders. That is a good example in microcosm in Springburn of what is wrong with the British economic system, writ large. We need to address that.

I hope the Minister will reflect on the reality. He is welcome to come and visit my constituency and see what it looks like on the ground. If we do not fix it, we will entrench economic division, alienation and the sort of social tensions that exist in our country, and which might have erupted as the reason why so many people voted to leave the European Union. A source of their frustration was an economic system that does not serve their interests. This is all connected; there is a complex interdependency. We need to address the wider tensions in society. This is yet another example of what is wrong with the state withdrawing from regulation and permitting neo-liberal practices to prevail. It is a major concern and needs to be addressed.

In the case of Springburn, the bank justified its closure programme by saying that there was a 25% reduction in footfall. I accept that the industry is subject to disruption due to changes in technology, as the hon. Member for Barrow and Furness (John Woodcock) said. However, the curve is way ahead of where people are at on the ground. The Government should be involved in closing down that gap, so that it reflects the real transitions that people make, particularly elderly people and disabled people.

It was claimed that 91% of people use a variety of other ways to engage with the bank in Springburn, but that includes phoning up the local branch to make an enquiry and using an ATM. Those are not mutually exclusive activities, so that is a questionable statistic. A minority of users—only 46%—use another Santander branch. The nearest branch is in Glasgow city centre, which is an expensive bus ride away for many people, particularly given that the community has a very low car ownership rate. A minority of customers—only 49%—use online or telephone banking services.

The Springburn branch is proposed to close in June this year, yet Santander’s lease will not expire until December, so for six months it will be a blight on the community with boarded up frontage. I want the bank to address that, as a minimum. If it is going to close the branch, it should ensure there is a transition. I appeal to it to realise its social responsibilities.

Ironically, at 2 pm today the Springburn Regeneration Forum kicked off across the way from the Santander branch in the Springburn shopping centre that is proposed to close. It is a community-led approach to bring together the council and other stakeholders to plan the regeneration of Springburn. What a blow that on the same day that that is happening the bank across the way in the Springburn shopping centre has announced that it is pulling out of the community. That is a sad illustration of our commercial banks’ lack of social conscience. That should be addressed. If the banks do not do so voluntarily, it should be done through legislation.

In a nutshell, that is what I think is wrong with the UK banking system and what the Minister should reflect on. I am sure our Front Bench team will do so, too. I am a Labour and Co-operative Member of Parliament. We are committed to a massive restructuring of the UK banking system in favour of co-operative banking, mutuals and a more equitable form of financing our economy. That is what we are supporting.

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[Dr Philippa Whitford (Central Ayrshire) (SNP)]

It is a pleasure to serve under your chairmanship, Mr Rosindell. I, too, thank my hon. Friend the Member for Glasgow East (David Linden) and the other Members who supported his bid for this debate. It is great to see this Chamber so busy, as it often is not. That shows the strength of feeling and how much the closures will affect our communities.

The letter that I received was sent to me as a customer. That was the first that I heard that our Santander branch in Troon was closing. I was previously a customer of RBS, and, like some other hon. Members, I moved my custom to Santander. I am not really sure where I am heading next. That is one of 140 closures—one fifth of the Santander network—15 of which are in Scotland. Some 1,300 jobs are now under threat, and only one third are likely to be redeployed. In the meeting, we were told that a third of those staff are looking to retire, get a package and get out. Have those discussions taken place, or is that a presumption?

[Catherine West]

Does the hon. Lady agree that it is inappropriate for an organisation to put staff on to less secure contracts in the knowledge that it will make 1,200 staff redundant, and might need those jobs later? It is not just a slap in the face to customers but to the staff who work hard in those branches.

[Dr Whitford]

I absolutely agree. I pay tribute to the staff in my branch, who were very helpful when we opened our account and are always cheerful. They are not about to retire. They are young working people who are not looking to take a package, but will need a job. They are being made unemployed, and they are deeply shocked by that.

There have been 3,000 branch closures since 2015, 230 of which are in Scotland. Two thirds of branches have been cut since the end of the ’80s. By the end of this year, we will have fallen from 21,000 to less than 7,500 across the UK. That is an incredible change. I totally accept that banking is changing, but, like many others, I use mixed banking. I will use an ATM, go into my branch and do online banking, but it is important that I have that choice. We are talking about choice being taken away.

This change is 20 years too early; we are not yet cashless or online. My mum, who is 84, and most people over 70 are not happy to do banking or any sensitive financial transactions online. My mum has her iPad and can do emails. It is not stupidity. She simply does not trust it. In making this change, we are leaving two decades’ worth of older citizens feeling uncomfortable and like they have had things taken away from them.

When banks move out, they do not leave their ATMs behind, which means that there is less access to cash in community after community, and the ATMs that remain are running out. Troon has already lost three banks. This is our fourth. I went through all this with RBS, which tried to use a unique customer identifier. It told me that only 97 customers a week went into the branch. I found that really strange, because every time I went in, I was in a queue. It only counted people who only went into that branch and went into the branch every single week. As was said, no other business would count custom in that fashion. When I finally got the correct figures out of RBS, that number was 10 times as high. Yet the bank would not reconsider its decision.

Although my hon. Friend the Member for Glasgow East has highlighted the issue of vulnerable people who have poor internet access, in Troon, a place to which many people retire, the issue is the elderly. In the impact assessment, it says that 58% of people have, on at least one occasion, used online, mobile or telephone banking, meaning that 42% have never used those methods. There is no quantification, so we do not know—as the hon. Member for Glasgow North East (Mr Sweeney) said—whether someone simply phoned the branch to ask what its opening hours are or when they could go in to get a statement. The idea that that means someone is suddenly ready to manage all their finances by phone or online is just a fairy tale.

The problem we have is that our elderly population is suddenly being told, as I was assured, that the closest branches are within a 10-mile radius—it is seven miles in one direction and 11 miles in the other—and for most of the elderly who live in Troon, however, that means taking two buses and more than an hour’s journey on a bus that is not frequent, so a visit to the branch could mean a three-hour round-trip. As was highlighted earlier in the debate, that also takes footfall out of Troon’s town centre, because if someone takes the trouble to go to Ayr, the chances are that they will shop in Ayr. They will not come back, go in to the middle of Troon, shop, and then get a bus home. That is gradually killing our high streets.

The access to banking standard and the need for an impact assessment were mentioned. We have all been sent little infographic-laden impact assessments, but it strikes me that they are largely about the impact on the bank. They are not really about the impact on customers, staff or our high street. The hon. Member for Ynys Môn (Albert Owen) mentioned the idea of having a hub. The obvious way to do that would be to bring back Crown post offices, but why do we expect post offices to co-locate with other businesses, but not banks to co-locate with each other or with post offices? It is absolutely vital that communities have some form of safe and secure access to financial services and advice.

Post offices are proposed as the answer to everything, but we cannot use them to open new accounts, carry out bank transfers or, if trying to manage our money, get full bank statements—only a balance. We certainly cannot arrange loans. Many of us used to go into a bank to speak to our bank manager, who was very strict about the income that we needed to obtain a mortgage. Part of what led to the 2008 crash was random decisions to lend people three, four, five, six or seven times their income so that they could get a mortgage, instead of giving them the chance to sit down and talk with someone who could see their financial performance. That applies to business customers who, at the early stages of development, need really personal input from someone who manages their service.

Quite apart from being the answer to all those problems, post offices are struggling financially. Previously, postmasters would get a fee, but funding for that is being cut from £210 million to just £70 million. As this is the fourth bank to close in Troon, all of that work is going to the post office. It has the same number of counters that it has always had, and it had a two-year gap of struggling to find a new postmaster when our previous one was ill and found it frankly all too stressful. In the Which? survey, 42% of those not happy about the move to the post office were concerned about queues. If the post office has the same number of counters but is suddenly doing the work of four banks, queues are inevitable.

Our closest town, Prestwick, has also lost three banks. When I met our postmaster after the most recent closure, he was initially quite positive, because he saw it as a business opportunity. I met him recently, however, and the bank transactions actually take money out of his business. Cash deposits are time consuming and he has had to take on an extra part-time member of staff. He does over 500 extra banking transactions a month and takes in £1 million a month. While Santander charges £7 per £1,000 deposited, the postmaster is paid 37p per £1,000 deposited. The Government subsidy for the 3,000 community post offices that are protected as the last shops in the village will end in 2021. We will literally have dead and empty communities with no access to anything and nothing to maintain footfall in a town centre.

We need to reward and support the post office. Santander is one of the biggest users of post office services, because it makes its business customers deposit cash in the post office. The fee paid to post offices for those transactions is currently being renegotiated. It is critical that that fee be fair, because otherwise we will see the last remaining Crown post offices not redeveloped as banking hubs, but shut down. Frankly, post offices wedged in corners of shops are not always accessible, are often cluttered and do not offer privacy to carry out financial decisions and management.

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[Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)]

I thank the hon. Member for Glasgow East (David Linden) and the Backbench Business Committee for enabling us to have this debate on a topic that is clearly vital to many communities.

We have heard some very good speeches today from the hon. Member for Angus (Kirstene Hair), my hon. Friend the Member for Heywood and Middleton (Liz McInnes), the hon. Members for Sutton and Cheam (Paul Scully), for Strangford (Jim Shannon) and for Tiverton and Honiton (Neil Parish), my hon. Friends the Members for Ynys Môn (Albert Owen) and for North Tyneside (Mary Glindon), the hon. Member for Barrow and Furness (John Woodcock), my hon. Friends the Members for Plymouth, Sutton and Devonport (Luke Pollard), for Hornsey and Wood Green (Catherine West) and for Glasgow North East (Mr Sweeney), the hon. Member for Central Ayrshire (Dr Whitford) and my hon. Friend the Member for Coatbridge, Chryston and Bellshill (Hugh Gaffney). That is quite a coalition, by any measure of parliamentary activity. Each of those speakers articulated very well the impact of bank branch closures—not just by Santander, but more widely—on their communities. Each speech raised several issues of public policy that I certainly agree need to be addressed.

The debate has shown that the challenge to maintain a banking sector that works for everyone at a time of rapid technological change is not being met and that the balance between digitisation and traditional banking models is not being got right. I want to say a few words to concur with the sentiment in the room today, but also a little about some possible solutions to these problems.

In advance of the debate, Santander provided some statistics on how people use its services and how that has changed. It said it has experienced a decline of about a quarter in branch transactions over the past three years, including for branch ATMs. It went on to say that that trend is expected to continue, with a projected 37% decline in branch visits across the industry in five years’ time. That is an empirical case for branch closures. We understand that—it is based on numbers and projected future demand. Those numbers alone, however, do not tell us the real story of how people depend on some of those services.

Today we are here specifically to debate the impact on local communities, and to do that, I want to share with colleagues and with industry, which will listen to the debate, the experience of my constituents and what bank branch closures have meant for them. Thankfully, the Santander branch in Hyde is not earmarked for closure in this round, but in recent years my constituency has lost branches of RBS, Lloyds, HSBC and Yorkshire Bank. Yesterday, on my Facebook page, I asked my constituents to share with me some of their direct stories of what that has meant for them. The first comment was:

“Losing the Lloyds in Stalybridge has been a blow. Yes there is one in Ashton”—

the town next door—

“and there is online banking. But there is no substitute for making an appointment you can walk to, talking to an actual human being.”

Another constituent, from Droylsden, which is just outside my constituency, said:

“Here…we now don’t have a single bank! We’ve gone from having Lloyds, NatWest, Royal Bank of Scotland and Halifax to having none!!! Our infrastructure dwindles by the day.”

The problem is even more acute for colleagues in more rural constituencies.

For businesses as well as individuals branch closures have posed particular challenges. One business owner—an existing Santander customer—said:

“You can do banking at the Post Office but, in order to pay things in, you have to get in touch with your bank first and get paying in slips sent out. Santander would only send me 5 and I have run out now. It means that I can’t accept cheques for my business easily, and I don’t have time to keep ringing up for more paying in slips.”

Someone else said:

“It’s a killer for small businesses, who have to close their shops to go and stand in a queue for a lengthy period of time just to get change.”

[Catherine West]

Given the history over the past decade of how small businesses have been let down by the big banks, does my hon. Friend agree that this is yet another slap in the face for small business?

[Jonathan Reynolds]

I agree with my hon. Friend. She is right to highlight—she did so in her speech—the many difficult issues with conduct in the UK banking industry, and specifically the abuses of lending to small businesses, which we have had many debates about in this Chamber and the main Chamber. Such abuses are particularly difficult to hear about—people have suffered some real abuses—and compounding them makes things especially difficult.

I have heard some particularly moving stories from those who care for others, who have borne the brunt of some closures. This comment choked me up:

“My mum with Alzheimer’s relied on her Lloyds branch in Droylsden before it was shut. The staff knew her well and helped her. They knew her condition and if she was in a bad way they would phone me and give her a cup of tea while they waited for me to arrive. The staff said there were lots of other people like my mum. The closure really affected her.”

Such stories show that we are talking about real people and the impact on their lives. Those are real experiences. The data do not always reveal that. The banks, of course, have the right to present that data to us, but our job is to tell the human side of the story.

We cannot hold back the tide of technological change—like some of my colleagues, I am not a luddite, and I love technology—but we can stop to think about how to make it work for us, not the other way around. Without protection the move to online as a default option will risk leaving the most vulnerable and marginalised in our society without services that work for them.

As we have seen in the debate around ATMs—which were raised several times in this debate—the risk is that we will sleepwalk into a society without access to cash at all, with the industry realising that we need those safety nets only when it is too late. Access to cash is becoming an increasing challenge for people, following bank closures and the decline in our high streets. The chair of the Payment Systems Regulator, Charles Randell, was right to ask in a Treasury Committee evidence session earlier this week whether access to ATMs should be seen as a universal service. I am sympathetic to that.

No one wants to prevent innovation. Indeed, some technological advances, such as remote video appointments or audible speaking ATMs, could for the first time help to include people who have historically had trouble interacting with traditional banking. Our objective, however, must be to use technology to benefit all customers, rather than creating a pared-down, automated banking sector that leaves people without the support they need.

The bank branch network has been shrinking at an accelerating rate. In December 2016, Which? reported that more than 1,000 branches of major banks had closed between January 2015 and January 2017. Banks stopped publishing data on closures in 2015, and there is now no central source for it, so the exact number of closures becomes more and more difficult to find out. Since those figures were published, however, we have seen multiple further closure announcements from banks, including Yorkshire Bank, RBS, Lloyds and now Santander.

The scale of the closures seems disproportionate and does not necessarily match how people want to use their bank branches. Also—this has come out in the debate—some of the modelling around the closures does not reflect the fact that branches are all closing at the same time. That was particularly the case in Scotland with RBS. Research conducted by the Social Market Foundation in 2016 found that strong consumer appetite remains for a physical presence. Nearly two thirds of consumers would prefer to talk to someone face to face when making a big financial decision.

A report by Move Your Money, published in July 2016, made the damning assessment that, far from responding to market pressures, the major UK banks are simply closing branches in poorer areas and opening or retaining them in more affluent ones. That is simply not acceptable. The same report mapped bank branch closures against the postcode lending data from the British Bankers Association, which is now UK Finance, to show that bank branch closures dampen SME lending growth significantly in the postcodes affected. The figure grows even higher for postcodes that lose the last bank in town. At a time when we all want to stimulate more lending to SMEs and to encourage growth, a sustained programme of bank branch closures risks taking us in precisely the wrong direction.

Labour’s answer to that is a proposal to change the law regulating banks so that no closure can take place without a real local consultation or the Financial Conduct Authority approving the tranche of closures. A future Labour Government would obligate banks to undertake a real consultation with all customers of the branch proposed for closure, including local democratic representatives on the relevant local council. The bank would be mandated to publish details of the reasons for closure, including the financial calculations showing the revenues and costs of the relevant branch. The share of central costs such as accounting systems, IT, cyber-security and personnel would have to be identified separately, because many of those costs are relatively fixed and not proportionate to the number of branches. The FCA’s approval would be needed for any bank branch closure. We think that is the right balance. It accepts that, as technology changes, there might be some closures, but it would ensure that customers are not forgotten about or taken for granted.

That is our policy on closures, but as my hon. Friend the Member for Ynys Môn said, we wish to go further. The Post Office is often referred to as the solution to bank branch closures, through its relationship with the Bank of Ireland. That is better than nothing—something like £14 billion in deposits is held in accounts linked to the Post Office—but there are clearly shortfalls. The hon. Member for Central Ayrshire highlighted some of those in her speech.

The potential exists, however, to build on that model and to create a genuine Post Office bank, which would ensure universal access to banking services for every part of the UK. It would be a standalone institution; it would pay the post office network for use of those branches, and it would therefore replace the network subsidy payment. It would offer a future for the Post Office, as well as for financial services in every part of the country. It would be held in a public trust model, with 100% of the shares held in trust for the public benefit, ensuring that no future Government could seek to privatise it. I plan to develop those plans and to present them in more detail in the near future, alongside our plans for the future of the public stake in RBS and other measures designed to increase plurality in the banking sector, including the return of new post offices to the UK.

--- Later in debate ---

[The Economic Secretary to the Treasury (John Glen)]

May I say what a pleasure it is to serve under your chairmanship, Mr Rosindell? I commend the hon. Member for Glasgow East (David Linden) for securing this debate and the 28 colleagues across the House who have made speeches or interventions in what has been a thorough examination of this important issue. As well as a Minister I am a constituency MP, and I recognise the pressure on us when our constituents are not happy with decisions.

Since taking up the position of Economic Secretary last January, I have become well acquainted with branch closures. They can be very difficult for the communities affected and, as we have seen this afternoon, they arouse strong passions across the House. I have taken time to speak with affected customers and businesses, including on my visit to Scotland last August, in order to really understand the concerns. I frequently raise this topic in my regular meetings with banks and the Financial Conduct Authority.

I will seek to address the points made by the hon. Member for Glasgow East and others across the Chamber. He referenced his community in Parkhead and the issues of staff, the impact assessment, the limitations of the relationship with the post office network that many Members have mentioned, and access to cash, which falls under the Treasury’s remit, although the Exchequer Secretary is responsible for that.

Closing a branch is never an easy decision, but it is one that banks take based on their assessment of current and future branch usage and customer behaviour. It is an assessment that they, as commercial businesses, are better placed to make than Government. That is why the Government do not intervene in individual branch closure decisions. However, the Government should not abdicate responsibility for some of the issues that arise.

[Catherine West]

In his reply to a written question by my hon. Friend the Member for Ellesmere Port and Neston (Justin Madders), the Minister said:

“the Treasury does not collect data relating to bank branch closures or related job losses.”

Does he believe that is an adequate Government response to 1,200 job losses and the closure of 40% of bank branches? Does the Minister believe that the Treasury should collect that kind of data?

[John Glen]

As I was going to respond to the hon. Member for Ynys Môn (Albert Owen), who also raised that point about bank branch closure figures, the FCA, which is the regulator responsible for regulating banks, did some analysis of branch closures as part of its “Strategic Review of Retail Banking Business Models” published in December last year. The full research can be found in an annex to the review. The analysis looks at the number and pattern of closures, how they affect urban and rural areas, the age of the customer, the level of deprivation and income levels. It is a thorough analysis across multiple banks and it very much informs Government policy.

Finance (No. 3) Bill

Catherine West Excerpts

3rd reading: House of Commons & Report stage: House of Commons
Tuesday 8th January 2019 Commons Chamber

[Vernon Coaker (Gedling) (Lab)]

I support the two new clauses. Unlike the hon. Member for Torbay (Kevin Foster), I think that they are very measured. They simply ask the Government to review the impact of the Bill on poverty and inequality.

I do not know what other Members think, but let me describe what I think the vast majority of people in all our constituencies believe, and what they believe this Parliament should be saying and doing. They believe that the current levels of inequality in our country are simply and utterly unacceptable. They believe that the levels of child poverty are simply and utterly unacceptable. They are not interested in someone being able to tell them that there are 2 million children living in terrible poverty, or 1,850,000 children living in absolute or, indeed, relative poverty. That is what those people are sick of, and what I am sick of, and what this Parliament should be reflecting.

Across the country, people are asking, “Can you not do any better? Can you not do something about the fact that there are still pensioners in one of the richest countries in the world who cannot heat themselves properly in cold weather, including at Christmas?” They are asking, “What is Parliament doing when we see children living in absolute poverty who cannot afford to go to school, with shoes and clothes and food being given to them as an act of charity by people in those schools?” They are not interested in whether the figures have gone up by 0.5% or down by 1%. They are interested in what this Parliament is doing about it, and what we are saying.

All these new clauses do is say to the Government, “If you believe, for example, that clause 5, through allowing people to keep more of their income when in work, addresses some of those issues, let’s have a review to see whether or not that is the case.” That is what people would expect.

I am sick of this myself. When I drive around, not just my constituency but the country, I see enormous wealth. I am not talking about people who have worked hard and done well, which we all want to see; I am talking about massive accumulated wealth—not just income—with people able to afford to pay astronomical sums on different ways of life, while half a mile down the street there is a kid in a household that cannot afford to put any proper food on the table.

[Catherine West (Hornsey and Wood Green) (Lab)]

Does my hon. Friend agree that it is terrible to think of all the many places in the country where there are so many more food banks, and that the year-on-year increase the Trussell Trust has told us about is deeply worrying?

[Vernon Coaker]

That is right. Every Member of this House would no doubt say, “Isn’t it great that there are food banks and so many volunteers at them?” I agree with that; I agree that it is good to see in communities across this country, in every part of the UK, so many people who volunteer their time with others donating to them. What I object to is that food banks, which are there as a charity, are used as an instrument of public policy—they are used as a way of tackling poverty. What on earth have things come to in 2018 and 2019 when food banks are a public policy mechanism for dealing with poverty? They are supposed to be charitable organisations for people who have somehow slipped through the net, not places where someone at the DWP sends people with tokens. That is an absolute outrage, and this Parliament should be seething about it. In saying that, I do not decry the volunteers; this brings the very best out of people, but—goodness me—is that public policy now?

That is what the Minister should be addressing. The challenge that I think every Member of this House would make to the Government would be to ask what is being done to address these issues. We do not want some academic debate about a bit of research here or there which means that the hon. Member for Torbay can say, “There’s 1,000 fewer here and 2% less there.” The levels of poverty and inequality in our country are a fundamental disgrace; why are the Government not raging about that and doing something about it through their Budget?

Treasury

Catherine West Excerpts

Thursday 20th December 2018 Ministerial Corrections

The following is an extract from an Urgent Question on ONS Decisions: Student Loans on 18 December 2018.

[Catherine West (Hornsey and Wood Green) (Lab)]

In the short term, will the Treasury review the inflation-busting 6.3% rate, and in the longer term will the Government admit that feeble wage growth is at the bottom of this problem?

[Elizabeth Truss]

That is a slightly strange question from the hon. Lady, given we have just seen the highest real wage growth for 10 years coming through our economy.

[Official Report, 18 December 2018, Vol. 651, c. 652.]

Letter of correction from the Chief Secretary to the Treasury:

An error has been identified in the response I gave to the hon. Member for Hornsey and Wood Green (Catherine West).

The correct response should have been:

ONS Decisions: Student Loans

Catherine West Excerpts

Tuesday 18th December 2018 Commons Chamber

[Elizabeth Truss]

That is a matter for the ONS.

[Catherine West (Hornsey and Wood Green) (Lab)]

In the short term, will the Treasury review the inflation-busting 6.3% rate, and in the longer term will the Government admit that feeble wage growth is at the bottom of this problem?

[Elizabeth Truss]

That is a slightly strange question from the hon. Lady, given we have just seen the highest real wage growth for 10 years coming through our economy.[Official Report, 20 December 2018, Vol. 651, c. 6MC.]

EU Customs Union and Draft Withdrawal Agreement: Cost

Catherine West Excerpts

Monday 22nd October 2018 Commons Chamber

[Mr Speaker]

Who is offering to do a short sentence? Ah, well done—Catherine West.

[Catherine West (Hornsey and Wood Green) (Lab)]

There seem to be a number of questions that the Minister is not able to answer. Is his boss available, or is he also in “the killing zone”?

[John Glen]

I was asked to respond, and I am happy to do my best to do so.

Oral Answers to Questions

Catherine West Excerpts

Tuesday 11th September 2018 Commons Chamber

[John Glen]

My hon. Friend is absolutely right. It was a privilege to meet David Hepburn at First Floors and see the value of new products. The Government are committed to stimulating more investment in FinTech, and it was a privilege to visit FinTech Scotland, which is doing a lot, too. We have invested a considerable amount to increase the numbers of people who are taking this step to innovate in finance, and with open banking we will see more.

[Catherine West (Hornsey and Wood Green) (Lab)]

T8. In response to a recent written parliamentary question, the Secretary of State for International Development confirmed that she paid her Department’s cleaners the living wage—the London living wage. Sadly, when I asked the same question of the Treasury, the response was that Her Majesty’s Treasury “does not hold” the information. Will the Chancellor take this opportunity to clarify why he and other Front Benchers do not know how much the cleaners who clean their desks every day are paid, and will he promise to introduce the London living wage not just in the Treasury but for every single cleaner who works in Whitehall?

[Mr Philip Hammond]

I imagine the reason is that the provision of these services is contracted out, but I will investigate and write to the hon. Lady.

Oral Answers to Questions

Catherine West Excerpts

Tuesday 3rd July 2018 Commons Chamber

[Mr Hammond]

I can tell my right hon. Friend that under the last Labour Government, the number of people achieving home ownership fell by 61%. I think Labour’s position is clear. The Leader of the Opposition has described home ownership as a national obsession; for the Government it is a national priority. We are helping hundreds of thousands of people across the country to achieve the dream of owning their own home, and that is why I am proud that, under a Conservative Government, the number of first-time buyers is now at an 11-year high.

[Catherine West (Hornsey and Wood Green) (Lab)]

Will the Chancellor tell us what is being done for people who cannot afford their own home, in terms of lifting the borrowing requirement on councils so that they can build more social homes?

[Mr Hammond]

We have a £9 billion affordable homes programme, and we announced a £2 billion uplift in that programme last autumn. We have increased additional flexibilities to allow building for social rent and to relax the housing revenue account caps on local authorities in the highest demand areas. This Government’s programme to deliver the homes this country needs achieved 217,000 net additional dwellings last year and is on track to deliver 300,000 net additional dwellings a year by the middle of the 2020s.

Customs and Borders

Catherine West Excerpts

Thursday 26th April 2018 Commons Chamber

[Rachel Reeves (Leeds West) (Lab)]

I will focus my remarks on the work of the Business, Energy and Industrial Strategy Committee regarding our relationship with the European Union and the customs union, and on the impact that leaving them will have on British businesses.

A couple of weeks ago the Select Committee visited Norway, where we were looking at electric vehicles. Of course, while we were there, we discussed with the people we met the border between Norway and Sweden. Norway is not in the customs union, but Sweden is in the European Union and therefore part of the customs union. Trade is not frictionless along that border. There is physical infrastructure and there are sometimes queues. The goods trade between Norway and Sweden is worth £13 billion a year. Goods going through the port of Dover alone are worth about £120 billion a year, and trade between Northern Ireland and the Republic of Ireland is worth more than £5 billion a year. This is not straightforward. There are huge risks and costs of us coming out of the customs union.

My Committee has produced five specific reports about the effects of leaving the European Union, on the civil nuclear sector, aerospace, the automotive industry, pharmaceuticals, and the food and drink sector. We received almost 100 pieces of written evidence during our inquiry and took oral evidence from more than 30 witnesses. Pretty much every witness, apart from the chief executive of JD Wetherspoon, spoke of their fears and worries about leaving the European Union and specifically about leaving the customs union, which is why I am so pleased that we are having this debate.

The Committee heard time and again that any border delays would undermine just-in-time delivery systems; force companies to expand warehousing facilities massively, at a significant cost, as the right hon. Member for Broxtowe (Anna Soubry) said so eloquently; and put at risk time-sensitive imports and exports, particularly of food, medical radioisotopes and many pharmaceutical products.

[Catherine West (Hornsey and Wood Green) (Lab)]

Is my hon. Friend aware that the members of the International Trade Committee made a similar finding when we visited the border between Canada and the United States? We saw very long delays there, and that was between friendly countries. Transposing such a situation to Northern Ireland would be a nightmare, especially with all the rifles on the shoulders of border guards and so on.

[Rachel Reeves]

Yes. Of course, this is most keenly felt and apparent along the border between Northern Ireland and the Republic of Ireland, as other Members have pointed out. But this is an issue not just in Northern Ireland, but at every port in the country. As an island and a trading nation, leaving the customs union will have a huge and devastating impact on us.