Financial Exclusion: Access to Cash

Gavin Newlands Excerpts

Tuesday 21st May 2019 Westminster Hall

[Mr Paul Sweeney (Glasgow North East) (Lab/Co-op)]

Thank you for calling me to speak, Sir Henry. I congratulate my hon. Friend the Member for Feltham and Heston (Seema Malhotra) on securing this critical debate at a time when our financial system is in flux. A decade ago, six of every 10 purchases were made in cash, but that figure has now halved and in a few years’ time it will be only one in 10, so there is a clear transition. Sometimes it catches me out; when I was in church a couple of weeks ago, I realised as the collection plate came round that I did not have any cash on me. The fear suddenly struck me that I would be humiliated in front of the congregation, so I am heartened to see that the Church of Scotland proposes to introduce cashless collection plates, which will save me that embarrassment in future. That is just one example of how the transition to a cashless society can catch us out suddenly and at the most unexpected moments, in a very public way.

The picture in my constituency is of a rapid removal of banking services. I represent one of the poorest constituencies in Scotland, which has seen a disproportionate decline in the number of bank branches and free-to-use ATMs. Indeed, one in five of Scotland’s 6,000 ATMs will soon be fee-charging, while ATMs are closing at a rate of one day. That significant decline is disproportionately affecting the poorest communities in Scotland, so it is critical that we address the issue.

[Gavin Newlands (Paisley and Renfrewshire North) (SNP)]

I raised that very point in the main Chamber just a few weeks ago. Ferguslie Park is the most deprived community in Scotland, yet it has two ATMs, which charge 95p and £1. That goes to show that LINK’s financial inclusion programme is not worth the paper that it is written on. I am still awaiting a reply from LINK after a month. Does the hon. Gentleman agree that its inclusion programme needs to be improved?

[Mr Sweeney]

I completely agree. My constituency, like the hon. Gentleman’s, has had a disproportionate number of closures. I commend and thank the Select Committee on Scottish Affairs, my hon. Friend the Member for Rutherglen and Hamilton West (Ged Killen), and the hon. Gentleman for their work on the issue. The LINK cut is critical, but we need legislative backing to safeguard provision. Many small businesses, including postmasters, are saying that they will not pay punitive business rates to maintain free cash access.

The discussions about credit unions are pertinent, and I commend the hon. Member for Glasgow East (David Linden) and my hon Friendfor Harrow West (Gareth Thomas) for speaking about their work on the issue. As a result of the closure of the Greater Milton and Possilpark credit union, 4,212 members have had that facility taken away. Santander is threatening to close and remove its ATM, just as in Parkhead. This is a critical issue, because banks do not feel any sort of obligation to maintain their provision. In America, Santander has a £1.9 billion community reinvestment fund because the American Government have forced it to do that in poorer communities, but there is no equivalent legislative obligation in the UK.

We need legislative teeth to back up the provision of banking services in our poorest communities. I urge the Minister to recognise that urgent need in our communities, particularly in Glasgow North East.