Local Bank Closures

Douglas Ross Excerpts

Wednesday 12th June 2019 Westminster Hall

[Douglas Ross (Moray) (Con)]

I beg to move,

That this House has considered the Government response when the closure of the last local bank is proposed.

It is a pleasure to serve under your chairmanship, Ms Ryan. I am delighted to have secured this debate, because the closure of our local bank branches in Moray has been an issue of significant concern for some time. I want to start with a roll call. Since 2015, we have seen 16 bank closures in the following towns in Moray: Cullen, Dufftown, two in Aberlour, three in Keith, two in Buckie, Elgin, a further two in Lossiemouth, two in Forres, Burghead and Fochabers. Those bank closures have affected communities in the north, east, south and west of Moray—no part of our area has been unaffected. The issue continues, with growing frustration for my constituents in Moray and constituents across Scotland and the UK.

In the UK, bank branches have reduced from 11,365 in 2007 to just 7,207 10 years later. In Scotland, between 2010 and 2018, a significant number of branches closed. RBS reduced its branch network by 70%, Clydesdale bank by 53% and Santander by 42%. Which? estimates that there are 130 communities in Scotland alone that are described as cash deserts. That means they do not have access to either a local bank branch or an ATM.

The banks have their reasons for doing this. They explain that footfall is decreasing, that more people are taking up online banking and that people can use different methods to deal with their banking needs. I disagree with that for a number of reasons, but an email I received from a constituent summed it up perfectly. The constituent comes from Portknockie, and wrote:

“I support you in calling banks to account. We know that bank closures in Moray have been severe and that banks have not even followed their own protocols when closing branches.”

She continued:

“I use online banking and am fortunate to have both the skills and fast broadband which make this possible, but I think that it is wrong that banks are acting on the assumption that everyone has these and increasingly that they have smartphones and good mobile signals. I have a smartphone but the mobile signal where I live in Portknockie is so poor that SSE were unable to install a smart meter.”

Yes, the banks do have many reasons for suggesting that these closures are the right way forward, but I believe that this constituent and many more who contacted me ahead of this debate are absolutely right. People are not unaffected by these closures. A large number of people in our communities either do not have access to fast broadband, to allow mobile banking, or simply do not want to use it, but wish to continue the face-to-face contact that they value with their banks.

[Stephen Kerr (Stirling) (Con)]

I congratulate my hon. Friend on securing this debate. His constituent also raised the question of the procedures and processes that banks go through before they disengage with a community. In the experience of my constituents and my own experience in Bridge of Allan, that is a tick-box exercise and nothing more.

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[Douglas Ross]

I endorse and agree with my hon. Friend’s comments. I want to focus specifically on how banks approach this whole process. It could be done far better—indeed, it could not be any worse.

[John Lamont (Berwickshire, Roxburgh and Selkirk) (Con)]

My hon. Friend is making an excellent case for why it is wrong that these banks have been closed. In my own area in the Scottish Borders, we have lost many bank branches, which causes great anxiety to many of the residents. When banks shut a branch, they say that there are mobile or other banking options, but many communities do not have access to mobile phone signals or broadband. Does my hon. Friend agree that the banks should be doing more, before they shut the branch, to ensure that all residents and communities are properly connected? The Government may have a role in supporting that, too.

[Douglas Ross]

My hon. Friend’s seat in the Scottish Borders, my own in Moray and many others across Scotland do not have adequate broadband provision to allow a suitable online connection, to which the banks are directing so many people. I will be interested to hear the Minister’s response to the point made by my hon. Friend.

It is right that we should discuss bank closures in the round, but this debate specifically addresses the point at which the final bank branch in a town closes. Sadly, we have recently seen that in Lossiemouth. Lossiemouth is not a small town; it is a growing town. The population is increasing, largely due to the UK Government’s investment there. We are putting £400 million extra in RAF Lossiemouth, which will be the home of the P-8 Poseidon aircraft. With that, there will be at least an additional 400 personnel and their families coming to the town.

It is all the more bizarre and upsetting that now, when Lossiemouth has this huge investment and is preparing for an increase in population, the last branch in the town should have decided to go—it closed last week. This weekend was the first without the branch and, as I will mention later, the ATM was also removed. In the first weekend after the branch closed and the ATM was removed, a town with almost 8,000 residents was left with no cash whatever. The two remaining cash machines in Lossiemouth ran out of money.

[Liz Saville Roberts (Dwyfor Meirionnydd) (PC)]

I am sure that all of us here now have experience of towns with no banks in them. If a town known to be highly dependent on the cash economy, as many of our tourism towns are—this particularly affects bars and pubs—loses its last bank, people will be aware that cash is being kept on premises. To what extent have the Government considered the security of the towns and the threat of organised crime? Bars and pubs in particular—on bank holiday weekends, say—will no longer be able to deposit cash locally, so that cash will be held on the premises, which are not equipped and not necessarily insured to hold that level of cash. This is an aspect that we have not considered so far.

[Douglas Ross]

I am grateful to the right hon. Lady, because that issue came up when I held a public meeting in Lossiemouth, following the announcement that the final branch in the town would close. The local football club, Lossiemouth F. C., said that it had checked with its insurers, who said that they would either increase the premium to a level that it could not afford or simply not insure it at all, because it would now not be able to deposit cash at the end of the night: the cash would have to remain on the premises. I hope the Minister addresses that issue, but we also have to put it to the insurers, because it is no fault of the football club or other operators in these towns that the banks are now closed and people cannot deposit money.

I want to return to Lossiemouth, a huge town in Moray, being left without cash this weekend. Denise Bedson of the Lossiemouth Business Association told The Press & Journal:

“The situation at the weekend was disgraceful. A lot of small businesses can’t afford card facilities. I know there are cheaper solutions but the phone signal isn’t always the best here for them to work properly. We’re trying to get more banking facilities here because the situation is very difficult”.

It was so difficult that there were reports of people going into the local store to buy one tin of baked beans just to get cash back. They had to buy something that they did not want or need, simply to get money from the store, because the cash machines were not working. Councillor James Allan, my colleague, who represents Heldon and Laich, has been a great local champion for this cause for years. We have gone from four banks and seven ATMs down to just two ATMs. In a community the size of Lossiemouth, that is simply unacceptable. This is just the first weekend. We have serious concerns that this will go on further.

Mention was made of tourism and tourist businesses. Lossiemouth is a great attraction for tourists, with whom it is very popular. We have takeaways and taxi firms, which do not accept credit cards or debit payments. They will suffer as a result of this. Lossiemouth Community Council and its councillors Mike Mulholland and Carolle Ralph have been highlighting the bank closures for some time; they also held a public meeting about them, following my meeting. The issue has been of considerable concern since the announcement was made last November. We knew that this was coming, but the banks have deserted Lossiemouth and other communities across Moray, Scotland and the UK. I believe that they have to do more about it.

While I am speaking about Lossiemouth, the area in Moray that is most affected because it has no branch left, I also want to mention post offices. They play a vital role, but there are some limitations. I know how hard Tony Rook, owner of the post office in Lossiemouth, and his staff are trying—as he commented in The Northern Scot this week, they are doing their level best—but when there is a spike in use and they are away for the weekend, there is nothing that they can do to put more money into their cash machine. He has one of the two cash machines in Lossiemouth. It costs his business to have it facing outwards to the street, but he does it as a public service. It is a great service, but even with great efforts from him and his staff, we were still left without money in a Moray town at the weekend. That is something that we need to look at.

It is not just Lossiemouth that has been affected. At the same time as the closure in Lossiemouth was announced, there was another in Keith. I held a public meeting there as well; I was grateful for the attendance of local councillor Donald Gatt, as well as Paul McBain, representing the post office, and Pearl Hamilton from the Federation of Small Businesses.

When we consider the impact of branch closures or the reduction of ATMs, we often think only about the customers who want to take money out, but the small businesses in our communities suffer just as much, if not more. FSB Scotland retweeted my tweets about today’s debate because it has great interest in the matter. Small businesses are losing not only the branch that they bank with and deposit their takings at, but the opportunity for people to take money out and spend it in their shops. They are the lifeblood of our local communities, so it is unfortunate and deeply reprehensible that they are being drawn into this.

I also want to speak about the bank’s response. I have to say that its contempt both for its own customers and for local communities is disgusting. As the local Member of Parliament, I got a phone call about the Bank of Scotland’s closures in Lossiemouth and Keith, days before it even wrote to its customers; I know my MSP colleague did, too. It came to the politicians to tell us, “This is what we are doing—oh, and by the way, we will tell our customers after the bank holiday weekend.” It thought that they could wait a few days before even bothering to tell its customers about news of such magnitude.

The banks get involved in the process that has been laid down to consult and inform communities of their decision, but they never change their mind. It is a fait accompli—they have decided what they are doing. When communities rightly stand up against these cuts and removals to express their concern about how deeply damaging they will be, the banks turn a deaf ear: they are not interested, and they do not want to hear it. I have to say that I think their behaviour shocking and unacceptable.

[Jamie Stone (Caithness, Sutherland and Easter Ross) (LD)]

The hon. Gentleman is making a most persuasive speech. When a local authority in Scotland wants to close a school, there has to be a proper public consultation process. Does he agree that something similar would be appropriate for proposed closures of bank branches?

[Douglas Ross]

The hon. Gentleman makes a valuable point with which I wholly agree. Like him, I have been involved with school closures as a local councillor, and they are not easy decisions to take. When we were proposing to close Cabrach Primary School in Moray, we had to have a full consultation, even though it had no pupils left at all—the final two, a brother and sister, had moved to another school. There has to be a full consultation with the community to close a school with no pupils, but a bank branch with so many customers that is so valuable to the local area can be closed when the bank comes in and ignores every view put to it.

My most abiding memory of Lloyds’s reaction to what it was doing in Lossiemouth and Keith was that it was not even willing to engage. I wrote to it when I quickly assembled the public meetings, which were attended by people from community councils, the post office and business associations. The meetings in Lossiemouth and Keith both had an empty chair for the bank; because it could not even be bothered to turn up and face the public about its decision, I thought it only right to show the public that it was absent by leaving a chair empty.

People wanted to challenge the figures about reducing footfall or the number of transactions. There were several people in the community who did not believe the figures that were put forward. The bank should have either substantiated its claims and stood up to support them, or gone back to the community and said, “This is where we were correct, and this is where you were correct.” That it was unwilling to do that demonstrates its whole attitude to this crisis.

The bank’s next response is, “Well, we’ll put in mobile banking.” A town the size of Lossiemouth, which has gone from four branches to none, now has a mobile bank coming for an hour or two a week. We have a great climate in Lossiemouth, but it is not always sunny and beautiful; it is sometimes cold and wet, and yet we expect elderly bank customers to stand outside and wait while others go in and carry out their business. There are also elements of privacy that a mobile banking service cannot replace. It is wrong that we should keep hearing, “We are closing your branch, but we will continue to have a presence.” That presence is pitiful, and it does not match the needs and aspirations of the community that uses it.

As I have mentioned before in Westminster Hall, in a debate about access to cash, RBS in Moray has a mobile branch van called the Moray Rambler. There have been so many closures of bank branches across the north-east of Scotland that the Moray Rambler now has to ramble into Banffshire and Aberdeenshire to cover areas outwith my constituency. Not only have we a poor service, but it is being stretched further and further and towns are getting less and less time with the mobile bank.

Post offices rightly have a role to play that we all value. Paul McBain represented the National Federation of SubPostmasters at my public meetings, and he did so well. Some tasks can be done at the post office instead of the bank, but some simply cannot be replicated: transferring money from an account, seeking advice about bank accounts, opening or closing accounts, registering a power of attorney or grant of probate, making complaints or inquiring about savings, current accounts, credit cards, mortgages, personal loans or investments. There is a role for the post office and there are tasks that it can do, but there are many that it simply cannot. It is wrong for the bank to say, “We’ll put in a mobile branch, or you can use the post office as an alternative.” It is not a like-for-like alternative; it is misleading and wrong to say so, and we will be in trouble if we go down that route.

Research into post office usage by Which? reveals that only 55% of adults are aware that they can use the post office for banking—almost half of the population do not know that—and that 47% are unlikely to use a post office for banking in the future. I hope that we can change those figures; as I said in an Adjournment debate in the main Chamber a couple of months ago, we need to encourage the public to use our post offices. However, many people out there do not want to use them for certain aspects of their banking needs. Some 42% of people did not want to go into a post office for banking because queues were too long, while 32% believed that they were not private enough.

[Stephen Kerr]

The key thing is that post offices have to be financially viable. If they are to take on more services, they have to be able to make a living from them. That is a fundamental challenge to the existence of many sub-post offices.

[Douglas Ross]

I agree wholeheartedly. That is an issue for the Government, but not for the Minister; I know that the Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Rochester and Strood (Kelly Tolhurst), has been discussing it. I want our post offices to be rewarded for doing the tasks that the banks are currently doing, because they are not being rewarded at the same level as banks for the jobs that they do.

My final point about closures goes back to the figures on footfall. In Lossiemouth, we have been told, “Your nearest branch is in Elgin, which is not too far away.” It is not far away in mileage, but getting there can be quite difficult because our bus services are not as good as they once were. People are expected to get the bus from Lossiemouth into Elgin, but ironically the branch there is not as accessible: people cannot park very easily on the high street, so they have to pay to use a car park and then troop round to the bank. Customers of the same bank used to go from Elgin to Lossiemouth because it was easier to park outside, and now we have closed the branch that they actually wanted to go to. Again, that shows how ill thought-out these plans are.

I know that many hon. Members want to speak in this debate, but I will just highlight access to cash. I have already mentioned the scenario in Lossiemouth where there was no cash available over the weekend. There has been a decline in the use of cash, but research undertaken in 2018 showed that 73% of people used cash frequently—that means once or twice a week.

The next figure that I will cite is interesting: 60% of 18 to 24-year-olds use cash frequently—again, that is once or twice a week. I am looking around me in Westminster Hall; before my hon. Friend the Member for Angus (Kirstene Hair) came in, I thought I was the youngest Member here, but she has beaten me to it. My hon. Friend the Member for East Renfrewshire (Paul Masterton) may have a complaint to make about that. Generally, we think that younger people—those in their thirties, or younger—are more likely to use smartphones, other technology or contactless payment, but we are told that 60% of 18 to 24-year-olds still use cash. Access to cash is not just something that affects the older population; it affects everyone in our communities. Industry figures predict that in a decade’s time, cash will still be the second most popular payment method.

A further concern that was mentioned today in a press release from Which? is that 7 million people were unable to use a payment card last year because of IT glitches. We can encourage people to use different payment methods and move away from cash, but people will still be affected if there are IT glitches, and such problems sometimes cost them money. We need to bear in mind that in the last year, 7 million people were affected by IT glitches.

[Patricia Gibson (North Ayrshire and Arran) (SNP)]

The hon. Gentleman is making an important point. Access to cash machines is also important for people who are on a budget. They like to withdraw small amounts without being charged, to help them to budget, whereas better-off people may make one large withdrawal for the week.

[Douglas Ross]

The hon. Lady is absolutely right. Research into the issue shows that some of the lowest paid in our society will be most affected if there is an even greater reduction in access to cash.

[John Lamont]

My hon. Friend makes an excellent point about the importance of cash. There is a wider economic point, because many of the small towns that he represents, and many of those that I represent in the borders, are absolutely dependent on cash. In Coldstream, Hawick and other towns in my constituency, when the banks have shut and the cash machines have gone, many traders have noticed a significant decrease in footfall and sales. That undermines the economic viability of the high street.

[Douglas Ross]

I totally agree with my hon. Friend. As he mentioned Coldstream and Hawick, I am sure he will get two press releases out of that intervention—something he always does well in debates such as this. Our high streets are vital to our communities, but we have seen a reduction in the number of shops on them. If that continues, we will really suffer.

I will briefly mention banking hubs. They are an idea that we have to consider, and I want to hear what the Minister has to say about them. The idea is not a new one; I know that it was suggested as far back as 2002. Last year, I wrote to every bank operating in Scotland about the suggestion of looking further at banking hubs—I know it has been made by several politicians from different parties—and I have to say that the response was disappointing. Some of the banks ignored the suggestion, and others said that hubs were not right for them. Nationwide said that it did not believe it was in the interests of its members to enter into a branch-sharing scheme. Such a scheme might not be in the interests of Nationwide’s members, but it might be in the interests of our constituents and its customers.

We have to do far more to get the banks to work together. They may have some concerns, but if we cannot have the four branches that we used to have in Lossiemouth, let us at least have one hub where the banks can work together to ensure there is still a banking presence.

[Kirstene Hair (Angus) (Con)]

I thank my hon. Friend for giving way and for bringing this important issue to the House. We have seen the starting up of a pilot business hub in Birmingham, whereby four bank branches have come together to help businesses. Does my hon. Friend agree that that shows that there is a mechanism for banks to do this, and that they just need the will to ensure that they help their personal banking customers just as much as their business ones?

[Douglas Ross]

My hon. Friend makes the point that hubs have been created before and there should be no blockage. However, the banks seem unable or unwilling to move forward on the issue, and perhaps the Minister can use either a carrot or a stick to encourage them to do a little more.

I will end by putting some points to the Minister and asking him some questions, and then I will allow others to contribute to this debate. I was interested to read a report from July 2018 by the Scottish Parliament’s Economy, Jobs and Fair Work Committee, which was chaired by my colleague Gordon Lindhurst. The report contained a number of key points, including that there will be an indefinite ongoing need for cash and universal face-to-face banking provision; that the access to banking standard, with its post-closure-decision consultation, is failing and a binding pre-decision consultation is needed; and that there is a need for the UK Government to research the issue properly and come up with binding statutory and regulatory conclusions.

I know that the Minister listened intently and understood the concerns of Scottish Members when he addressed this issue at the Scottish Affairs Committee this morning. I hope that, with some of the asks from me and other Members, the UK Government can make some progress on this issue.

I hope that the Minister will look at the access to banking standard and toughen it up, because some banks are not part of it. As I said when I read out communications from a constituent and others, there are concerns that banks are not adhering to the standard. I also hope that he will engage with the banks about banking hubs; the banks have too easily written off that suggestion rather than engaging properly on it. Although I accept that there are commercial reasons why banks choose to leave towns, I hope that the Minister will accept that the situation is different when a bank branch is the last to leave a town or village, and that that has a far greater impact than earlier closures.

To conclude, there has already been a devastating reduction in the number of branches across Moray, across Scotland and across the UK. We almost always lose ATMs at the same time, and therefore access to cash as well. We need to reverse that trend. Banks can improve their image—it is not always the most positive—by listening to communities and working with them, and not by simply leaving towns and villages. To date, I do not believe that the Government have done enough. We can also improve our image on this issue by working with communities and ensuring that they retain the banking presence and bank branches that they so greatly need.

[Joan Ryan (in the Chair)]

I intend to start calling Front-Bench spokespeople at 3.27 pm. That leaves roughly between four and five minutes if each Back-Bench Member who wishes to speak is to have an equal share of the time that is left; I leave Back-Bench Members to manage their time themselves.

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

It is a pleasure to serve under your chairmanship, Ms Ryan. I congratulate my hon. Friend the Member for Moray (Douglas Ross) on securing this important debate. I acknowledge the contributions of all who have spoken this afternoon. I have listened carefully to the speeches, and it is good to have seven of my hon. Friends from north of the border here. I will endeavour to answer the points substantively.

I gave evidence to the Scottish Affairs Committee this morning on this very issue. Straight after this debate, I hope to make a speech at the Which? cash summit, where I will set out the work being done by industry, the Government and regulators to ensure that access to cash is safeguarded. I recognise that this is a very important issue for many of our constituents. In my own constituency of Salisbury, I have seen bank branches close and I understand how difficult that is for communities. We have heard some specific examples this afternoon of the distress that can be caused when the process does not go smoothly. I recognise there are different opinions across the House about how the challenge should be met, and I will address those shortly.

Undoubtedly, the fact that the retail financial landscape is changing rapidly, as more consumers and businesses opt for the convenience, security and speed of digital payments and digital banking, is a significant factor. Ten years ago, cash accounted for more than three fifths of all payments in the UK; today, the figure is less than three in 10—and that is anticipated to fall to less than one in 10 in nine years, by 2028. In 2017, debit cards overtook cash for the first time as the most frequently used payment method in the UK.

I am very sensitive to the point made by the hon. Member for North Ayrshire and Arran (Patricia Gibson) that debit cards are not everyone’s choice; it is really important that we keep in focus the need to maintain access to cash. In 2018, two thirds of UK adults used contactless payments, 72% of UK adults used online banking and 48% used mobile banking. How we use financial services is changing and consumers have more choice than ever. It is an exciting time, but it is also a disruptive and potentially confusing time for our constituents.

Closing a branch is never an easy decision, but the decision will ultimately be a commercial one for the bank. The Government have been clear that we do not intervene in those decisions because industry is best placed to know what works best for its customers. I recognise that branch closures can be very disappointing for customers and the impact on communities must be understood, considered and mitigated where possible. I will therefore set out some of the ongoing work in this area—in particular, access to the banking standard and how it might be enhanced.

[Douglas Ross]

The Minister says that closing a bank is a commercial decision and the banks are listening to their customers. How can they be listening if they take those decisions prior to any consultation and if, when they are encouraged to engage, they do not even turn up?

[John Glen]

That behaviour that my hon. Friend experienced in his constituency is not best practice. It is not acceptable. It is very unfortunate when that happens. My job is to try to ensure that there is a systematic upgrade to the quality of the consultation and engagement from the banks, and I will now set out what is happening.

The access to banking standard has been noted by a number of colleagues today. Since May 2017, the major high street banks have been voluntarily signed up to the standard, which commits them to work with customers and communities to minimise the impact of branch closures. The standard ensures that banks keep customers informed about branch closures, and that the bank sets out its reasons for closure and the alternative options for continued access to services. How meaningful that consultation process is has been raised, on the basis that it happens when a decision has been made and not prior to the decision. I am looking into that. I have written to the Lending Standards Board and will be meeting its representatives to discuss the matter further.

The options for continued access should include specialist assistance for customers who need more help. For example, the Lending Standards Board, which monitors and enforces the standard, has told me it sees evidence of support from firms to assist customers in understanding and using alternative banking options. I recognise that that happens in some, but not all, cases. Such support might include digital experts being placed in the relevant branches to demonstrate how mobile and online banking works and assisting those customers who wish to use that functionality, as well as making introductions to nearby post offices and retained branches.

I continue to be very supportive of the access to banking standard and I value the commitment it places on banks to communicate the next steps for customers when the decision is made to close a branch, but I am aware of the concerns that colleagues have expressed about the standard. I confirm that I recently wrote to the Lending Standards Board to seek reassurances that the access to banking standard remains fit-for-purpose, and I intend to meet the chief executive to discuss matters further, drawing on the meetings I have had with various groups from all parts of the House and on the representations made so forcefully by colleagues this afternoon.

I turn to the Post Office. I was pleased to see the successful renegotiation of its commercial agreement with high street banks. That will enable 99% of personal customers and 95% of small and medium-sized enterprise customers to continue to carry out their everyday banking at one of the UK’s 11,500 post office branches; that is 91 more branches than there were in March 2018. I acknowledge the point that my hon. Friend the Member for Moray made about functionality and how not all functions can be carried out at the post office. That could evolve, but we already see aggregation of banking services at the sub-regional level when more specialist advice is required. The issue is about working out ways to solve that challenging problem. I am engaged in that work and am happy to explore that further with him.

As a result of the renegotiation, postmasters will see a considerable increase in fees for processing deposits, and the fees will rise further if transaction volumes continue to grow. An increase in fee income will help the Post Office and its network become more financially sustainable and will allow for investment in automation, training and security in post offices. Some £2 billion has been invested by the Government since 2010.

It is essential that more people know about the banking services offered by the Post Office, which is why I asked it to work together with UK Finance to raise awareness. According to a survey by Which?, only 55% of UK adults are aware that they can use their post office for banking services; that statistic was made clear this afternoon by my hon. Friend. The point he did not make was that 77% of those who had used the post office for banking said they would do so again. We are on a journey of understanding, as people become familiar with what can happen in a post office. After that work, UK Finance and the Post Office found that awareness had increased and committed to using community outreach to further improve awareness. I will continue to take a keen interest in the progress of that work.

Although many customers are satisfied with the Post Office’s banking services, I am aware that there are still some outstanding concerns—they have been mentioned this afternoon—such as with privacy and queueing. I have therefore written to my hon. Friend the Member for Rochester and Strood (Kelly Tolhurst), the Minister in the Department for Business, Energy and Industrial Strategy responsible for postal affairs, to request that our officials continue to work closely to explore the issues.

My hon. Friend the Member for Ayr, Carrick and Cumnock (Bill Grant) made a point about credit unions and post offices. I welcome any feasible innovations in that space. The main trade body for credit unions is conducting extensive UK-wide consultation, and it will come back to the Government in September. I would be happy to explore with it how the solution he suggested might be acted on.

Related to bank closures is the issue of continuing access to cash. It is clear that for some people, cash remains their preferred, or only, method of payment for a variety of reasons. My hon. Friend the Member for Waveney (Peter Aldous) set out his experience, and that situation remains true for many people out of choice. Our financial system needs to cater for everyone in our society. Although it is exciting for many consumers, technology must not come at the expense of choice. There will therefore be no changes to our current system of notes and coins. We want to ensure that cash is available for those who need it, when they need it.

In 2015, we established the Payment Systems Regulator, a powerful economic regulator of the payments industry. Its objectives balance the need for competition and innovation on the one hand with the protection of consumer and business interests on the other. Through the creation of the joint authorities cash strategy group, we are acting to ensure a comprehensive approach to regulation in light of changing trends and preferences for cash. The Payment Systems Regulator is already examining the factors that affect the distribution of ATMs across the country. I was concerned by what happened in Lossiemouth: it is a good case study for the regulator to be examining during the early weeks of its work.

I welcome today’s announcement by UK Finance, the trade body for banks, that it too intends to explore key issues around access to cash, including the role of local areas and communities. The industry must continue to play its part, and developers should consider the needs of all customers as they design new digital banking products and forms of payment. We are seeing companies such as Square trying to increase the use of card payments in small towns. No one should be locked out of the benefits that technology brings.

I recently concluded a Westminster Hall debate speech with a call to arms to the industry to think about all consumers when developing its services, and I re-emphasise that here this afternoon. I welcome the innovations that banks are introducing to respond to changes in customer behaviour as more of us choose to bank on demand online or via an app, rather than visiting a branch. We cannot reverse digital innovation, and nor should we, given the benefits it brings to our constituents—I acknowledge once again the point made by the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone) about his constituents’ experience of connectivity—but we need to find solutions for the whole of the United Kingdom. Improving digital and financial inclusion is key to ensuring that vulnerable customers are not left behind.

I will keep pushing the industry—someone mentioned the carrot and the stick: both are required—to move forward and do more. I hope Members will recognise that I have responded thoroughly to the points made. I am happy to continue the dialogue, but I am working to engage on the specific issues raised and to secure the improvements needed.

[Douglas Ross]

First, I thank you, Ms Ryan, for how you have chaired this debate; there was a subtle change in your demeanour indicating that I had spoken for long enough, and that ensured other colleagues were able to speak.

I am grateful to the hon. Members for Motherwell and Wishaw (Marion Fellows), for Strangford (Jim Shannon) and for Caithness, Sutherland and Easter Ross (Jamie Stone); to my hon. Friends the Members for East Renfrewshire (Paul Masterton), for Ayr, Carrick and Cumnock (Bill Grant), for Waveney (Peter Aldous) and for Stirling (Stephen Kerr); to the hon. Members for North Ayrshire and Arran (Patricia Gibson) and for Oxford East (Anneliese Dodds), the Opposition spokespeople; and to the Minister for a constructive, detailed and hopefully positive debate—not only for Lossiemouth, Moray and Scotland, but for communities across the United Kingdom that have been affected in this way.

The Minister said that the Government have made progress, which is welcome, but we can also agree that there is more to be done after this debate. His constructive response shows that the Government are listening. I have written down the actions that he is taking at the moment and that he will take going forward, but he will be left in no doubt by today’s debate that there are still major issues in all our constituencies that need to be tackled. There was mention of banging heads together and carrots and sticks: we have to use any and all means to find a solution to the problem. Although it is useful to have had this debate, talking only goes so far. We need action, and we need it now. I am encouraged by this debate that that will happen, but the pressure will remain until we can ensure that our communities can continue to be served by the banks they need.

Question put and agreed to.

Resolved,

That this House has considered the Government response when the closure of the last local bank is proposed.