Banks and Communities

Ged Killen Excerpts

Thursday 11th January 2018 Westminster Hall

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

It is a pleasure to serve under your chairmanship, Mr Gapes. I thank my hon. Friend the Member for East Lothian (Martin Whitfield) for securing this timely and important debate. There is no doubt that how we access banking services has changed in recent times. However, as with any change, there is a balance to be struck between evolving practice—in this case, the rise of online banking—and ensuring that the drive for change does not cause damaging disruption to the services local communities rely on.

The recent round of bank closures by RBS, NatWest and Lloyds has got the balance wrong, as did the previous round of bank closures. The Government’s view is that bank closures are a commercial matter only and that they will not intervene in such issues. As someone who used to run a small business—I refer Members to my entry in the Register of Members’ Financial Interests—I can say from experience that local branches are not just private companies but essential utilities to the communities in which they are based. An easily available, well-run local bank branch has all the productivity benefits of good roads and a reliable internet connection.

The Government cannot absolve themselves of responsibility by claiming that such closures are simply a commercial matter. Research by the Federation of Small Businesses shows that branch closures are damaging to small businesses, with one study finding that lending to small businesses in a given postcode area fell by almost two thirds following a bank branch closure. Lending for small businesses grows on average from one quarter to the next by 2.13%. However, after a closure, growth falls to 0.79%—a reduction of 63%.

In the last round of closures it was announced that six bank branches were closing in a matter of months. Both Blantyre and Cambuslang no longer have any bank branches. I recently asked my constituents what effect the closures were having on them. One respondent, Joy, said:

“My husband is self-employed and he has a lot of coinage to bank. Because of the bank closures, we now have to travel from Cambuslang to Rutherglen, as the branches in Cambuslang and Burnside are now closed. There never seem to be more than two tellers on the counter at any one time and you can wait for over 30 minutes before being seen. This eats into time that could be spent earning.”

RBS says that post offices can provide services in the place of closed branches. However, I have concerns about the capacity of post offices, which have also closed in great numbers, to meet that demand. Post offices do not have the expertise of local branches, which will deprive people of easy access to more complex banking services.

The impact of such closures will be felt hardest by those who struggle either physically or financially to travel, meaning that the elderly, disabled people and the poorest in society will be most affected by the Government’s failure to act. An impact will also be felt by aspiring local businesses. From my experience, I know how important it is to build that trusting relationship with a bank from the beginning, and there really is no better way of doing that than old-fashioned face-to-face contact.

It is likely that small businesses will receive less money for setting up and essential in-branch transactions will take more time and be less accessible to those who find it difficult to travel. Banks draw people to the high street, and retail businesses are already struggling to survive. Any decline in footfall and reduction in availability of free-to-use ATM machines for customers to withdraw cash could well be the final straw for many retail businesses.

It is important that we view local branches not just as commercial enterprises but as essential local utilities that play an important role in supporting local economies. Communities rely on banks, but that relationship is two-way. When the banks got into trouble, it was taxpayers in our local communities who stepped in to save them. What a dreadful way this is to repay that favour.

RBS Rural Branch Closures

Ged Killen Excerpts

Monday 18th December 2017 Commons Chamber

[Stephen Barclay]

As a rural constituency MP, I recognise the importance of bank branches in our communities and, specifically, many of the challenges of travel in rural communities. Of course, RBS will have noted the comments about the staff impact made by the right hon. Member for Ross, Skye and Lochaber, and he will be well aware that RBS has a duty to consult its staff. I expect that it will be keen to respond to him on the specific allegation he made in the House this evening.

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

I am alarmed this evening to hear the number of staff who might be made redundant, but I am also concerned about the staff in the remaining branches. There have been six bank closures in my constituency and businesses are contacting me to say that in the local branches they are now going to they are waiting more than 30 minutes to get to the counter. Obviously, there is now a massive impact on the staff in those branches. Does the Minister share my concerns?

[Stephen Barclay]

The reality is that the picture will be more nuanced, because RBS is investing more than £8 million in its branch network this year. It is investing more than £11 million next year. Indeed, it is relevant to point out in response to the concerns raised that customers will often vote with their feet. The right hon. Member for Ross, Skye and Lochaber mentioned Kyle twice. I understand that there is a branch of Lloyds 0.05 miles from the bank that is closing there, and another branch within walking distance of the one that is closing in Aviemore, which he also mentioned.

HMRC Closures

Ged Killen Excerpts

Thursday 2nd November 2017 Westminster Hall

[Chris Stephens]

I will meet the hon. Gentleman halfway. I do not believe that unpaid taxes are at a new low. In fact, I think the report I referred to earlier, published by Tax Justice Network and PCS, showed a gap of £119 billion. That certainly suggests to me that one of the major focuses of HMRC should be collecting tax and going after the rogues who are registered in the Cayman Islands and other places, shuffling money. I will meet the hon. Gentleman halfway on that.

HMRC faces a number of challenges requiring investment in offices and infrastructure, and no one from HMRC or from the Treasury has so far explained what changes they will make in the “Building our Future” programme to meet these challenges. I will not avoid saying, “We told you so,” because we did, time after time, in this place and elsewhere. We know that UK overseas territories are used to avoid billions of pounds of tax. We know that the uncollected tax avoided by these high-rolling spivs runs into tens or even hundreds of billions of pounds. It beggars belief that, at a time when there is more focus than ever on tax dodgers and their theft from public services, HMRC are shuttering dozens of offices across the country, losing staff and skills that could otherwise be used to target the high rollers who cost our hospitals, infrastructure and schools billions each year.

It is therefore somewhat ironic that Mapeley, to which HMRC’s office estate has been outsourced, is based in Guernsey, a notorious tax avoidance hub overseen by the UK Government. Downing Street confirmed yesterday that HMRC will need up to 5,000 new staff as a direct consequence of Brexit and the UK leaving the customs union.

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

Does the hon. Gentleman agree with me that, with the combination of Brexit and the devolution of increased powers over tax and income bands to Scotland, it is exactly the wrong time for HMRC to consider scaling back its operations?

[Chris Stephens]

I agree with the hon. Gentleman. The next question is rather obvious: “Where are all these staff going to go?” Some will be deployed at the new hard border, which those on the Government Benches seem to believe will have virtually no impact on our economy. At least, I can only assume that they believe it will have zero impact; that can be the only reason for yesterday’s refusal to publish 58 impact assessments that they commissioned. Some will be based in HMRC offices, but what offices? Where in the country will these new recruits be based? Over the last two decades the number of HMRC offices has gone from 700 to, under the Government’s plans, just 13.

Where exactly are the HMRC staff tasked with border duties in the north of Scotland going to work? They cannot work at the Lerwick office, because it is closed. They cannot work at the Ullapool office, because it is closed. They cannot work at the Wick office, because it is to close. They cannot work at the Peterhead office, because—guess what?—it is closed. The only offices left in Scotland will be in Glasgow and Edinburgh. We will have legions of new HMRC staff, tasked with policing the customs border that it appears to be the Government’s wish to create, with nowhere to carry out their office role, in an area of work that is guaranteed to involve more paperwork, more deskwork and more IT skills. I mention those offices in particular because each of those towns is a port, importing and exporting on a daily basis—the very places where, one would assume, HMRC staff are needed most. The lack of joined-up thinking on the issue would be laughable were the consequences felt across the country not so serious.

We also found out in July this year that only 399 staff are employed by HMRC in enforcing the national minimum wage, less than one full-time staff member for each constituency represented in this House. I simply do not believe, and neither do HMRC staff members, that the number of exploitative and criminal employers is so low as to allow for that low level of staffing. Indeed, the Government confirmed to me in a written answer in June that it would not, and had no plans to, fill the 83 current vacancies in the HMRC minimum wage compliance unit.

In the last financial year, HMRC closed 2,600 cases of non-compliance with the national minimum wage. That such a small staff team managed to bring so many criminals to book is incredible, and a tribute to their tenacity and hard work. However, I simply do not believe that that is even the tip of the iceberg. There are many thousands of other criminals out there, exploiting low-paid staff and pocketing profits for themselves. These individuals must be rooted out and dealt with, but what hope do 399 staff have of policing the full gamut of employer exploitation when 2.67 million businesses are registered for VAT or pay-as-you-earn? How can an office in Edinburgh properly and sustainably investigate employer criminality in Islay or Caithness? HMRC’s cuts agenda is putting the poorest and most vulnerable employees at risk of exploitation by crooks and gangsters the length and breadth of these islands.

The hon. Member for Ochil and South Perthshire talked about the closures in the round. I mentioned earlier that the proposal for the Welsh language unit in Wales means there will be a relationship with the Department for Work and Pensions, but what is that relationship? It is time for the Government to produce a map of office closures for all Government Departments, because we will find ourselves in the farcical situation of an HMRC employee having to take redundancy because they cannot travel hundreds of miles to the new regional centre, only to find that the jobcentre has been removed from their town as well and they will have to travel further to sign on, never mind go to work at HMRC. I hope that the Government will produce a map of office closures across the United Kingdom.

I will touch on the roll-out of universal credit and HMRC’s role in how this is paid to claimants. Universal credit fundamentally depends on the ability of HMRC to provide real-time information to DWP about an individual’s earnings from work. The entitlement to UC for the following month is calculated from that, based on the Government’s own formula. It is therefore vital that the information provided by HMRC is 100% correct and accurate. Any errors in the processing or transfer across to DWP of the employee’s salary information could be catastrophic for someone relying on universal credit to top up their low salary.

We all know the carnage being wrought by the roll-out of universal credit; but I fear that the cuts to HMRC’s capacity could result in further devastating implications for people receiving in-work benefits. If things go wrong with the flow of real-time information to DWP, if errors are not identified before universal credit payments are calculated or if the data is provided to DWP late, the consequences for the worker pile up, with fewer staff and fewer offices within HMRC to correct these errors and ensure that the correct payments are made.

Improvements in digital services are welcome, but not at the expense of the capacity for human intervention and expertise to fix problems and resolve issues. I fear that the Government have not properly recognised these new, massive interactions between DWP and HMRC in its “Building our Future” programme, and that the price to all of us, particularly those who need help the most through universal credit, will only become apparent when people’s finances and lives are devastated through no fault of their own. The landscape has changed immensely since the “Building our Future” programme started. Customs barriers could be erected in a little over 18 months. Thousands of new HMRC employees will be recruited, after years in which we were told that job losses were the inevitable result of progress. I hope that the complexities of universal credit, with all the potential for human disaster that they entail, are now becoming apparent to those on the Government Benches.

There are growing demands for tax justice from across the political spectrum. It is surely time for HMRC and the Treasury to hold their hands up and admit that they got this one wrong. It is time to admit that the world has shifted on its axis since “Building our Future” commenced and that the burden on HMRC staff, both current and future, represented by the programme is unsustainable, unjust, and cannot be a rational way to run a taxation system. It is time for HMRC to go back to the drawing board and begin planning the next generation of accommodation for HMRC staff and services, serving communities and the people in them, rather than the bureaucratic nonsense that my constituents and others have to endure.

The plans to close HMRC offices will be extremely damaging to HMRC’s operations. They fail to understand or take into account the diversity of the needs of the Scottish or, indeed the UK, economy and have the potential to seriously compromise the ability to collect tax, enforce compliance and close the tax gap. They also create massive uncertainty about jobs and locations across Scotland and the UK. With Brexit looming on the horizon, the Government must now urgently review their plans for the future of HMRC and ensure that it is fit for purpose.

Economy and Jobs

Ged Killen Excerpts

Thursday 29th June 2017 Commons Chamber

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

I am grateful for the opportunity to give my maiden speech in this lively debate. It is an honour to be standing here, representing the good people of Rutherglen and Hamilton West as their Labour and Co-operative MP. It is a pleasure to follow excellent maiden speeches across the House, particularly those of my hon. Friends the Members for Gower (Tonia Antoniazzi) and for Warrington South (Faisal Rashid), and the hon. Member for Chichester (Gillian Keegan).

I begin by paying tribute to all those affected by recent events in London and Manchester, painful and shocking tragedies that were truly felt right across the country. One of my constituents, Piotr Chylewska, was seriously injured in the Manchester bombing, and is one the last survivors to be discharged from hospital. I am pleased to say that Piotr is making good progress and I am sure that Members across the House would like to join me in wishing him well. [Hon. Members: “Hear, hear.”] I thank Father Paul Morton, the St Bride’s parish in Cambuslang and the wider community for the support they have shown Piotr. It is that coming together in times of adversity that is a testament to our shared values—values that I see examples of every day in my wonderful constituency of Rutherglen and Hamilton West.

In my home town of Rutherglen, coffee shops such as the Black Poppy collect and distribute toiletries for the homeless. In Blantyre, we have public houses like the West End Bar supporting generations of families affected by Chernobyl. We have community councils; proud Lanarkshire institutions that give generously to charity, like Equi’s Ice Cream in Hamilton; social enterprises like R:evolve Clothing; residents’ associations, churches and community development trusts like Healthy n Happy: and too many more organisations to name in the time I have. We have a diverse mix of decent people, all coming together and helping to make our communities better places to live, one small act of kindness at a time. They are the everyday heroes, and I thank each and every one of them for the job that they do.

My predecessor, Margaret Ferrier, was a strong advocate in this House for human rights across the world. I have no doubt that she cared as deeply for my constituency as I do. In her maiden speech, she spoke of working together in a spirit of collaboration, and although it will not be surprising that I have few fond memories of previous Conservative Governments, let me say, as the first gay married man to represent my constituency, and in that spirit of collaboration, that I welcomed the equal marriage legislation passed under the 2010 coalition Government. I look forward to the continued advancement of lesbian, gay, bisexual, transgender and intersex equality in this place and across the whole United Kingdom.

In reading the speeches of my predecessors, I was struck that the occasion of a maiden speech is an opportunity to leave a message for the future. I hope my successors and I will be able to look back and have at least one fond memory between us of the current Government. Unfortunately, initial impressions suggest I may be disappointed. Having served as a local councillor, I have seen at first hand the effects of Government austerity on the communities in my constituency—real consequences for jobs, services and the local economy. When I hear stories of people using candles to heat and light rooms in their home, of disabled people unable to put on their own socks and shoes losing Government support and being found fit to work, and of siblings in their 20s sharing a bedroom because they have nowhere else to go—stories not from the pages of history, but from real life in my constituency in 2017—I wonder, where is the deal for them? If Conservative Members are truly to be a Government of all the nations and regions of the United Kingdom, it is time to start acting like it. It is those individual lives—the everyday heroes—that I want to focus on in this place.

It has been an exciting and somewhat unexpected journey for me, from Gorbals boy to Member of Parliament via Rutherglen and Blantyre. In this era of fixed-term Parliaments, the great irony is that I have no idea how long I will have a seat in this place, but my pledge to the people of Rutherglen and Hamilton West is that I will make every day count.