Bank Closures: Rural Areas

Debate between James Murray and Jim Shannon

Monday 24th February 2025 Commons Chamber

[The Exchequer Secretary to the Treasury (James Murray)]

I commend the hon. Member for North Dorset (Simon Hoare) for securing this debate. He has ensured that the views and concerns of his constituents have been heard by Ministers this evening, and he has set out the particular dynamics of the role of banking hubs in rural communities. The fact that he received so many interventions from other hon. Members underscores how important this issue is to constituents across the country, and I thank him for securing this important debate.

It might be helpful if I outline some of the context around this issue. In recent years, people across the UK have reaped the benefit of the transformations of the UK’s banking sector, particularly the enhanced accessibility and convenience afforded by remote banking. For example, in 2017 40% of UK adults regularly used a bank branch, but by 2022 only 21 % of UK adults did so, and almost nine in 10 banked online or used a mobile app. Notably, that includes 65% of the over-75s. However, the Government recognise that those changes have presented considerable challenges for others.

Bank branch closures can have a particular impact on rural communities given the distances to alternatives—indeed, we heard examples of that from the hon. Member for North Dorset, and other hon. Members who intervened to highlight specific cases and to draw the House’s attention to the challenges facing their constituents. I assure hon. Members, and the people they represent, that this Government understand the importance of face-to-face banking, and banking access, to local communities and high streets. Our objective is to ensure that people and businesses have access to banking services, supporting local communities and local economic growth. Work on that is well under way, and we are working closely with banks to open 350 banking hubs by the end of this Parliament. My right hon. Friend the Chancellor marked the opening of the 100th banking hub in December, and more than 200 hubs have been announced in total.

[Jim Shannon]

The hon. Member for North Dorset referred to 14 banks closing, and I referred to 11 closing. When it comes to the criteria for agreeing where those bank hubs will be, will the Minister reassure me that those constituents who have lost the most banks will be those who get more banking hubs when the opportunity comes through?

[James Murray]

The hon. Gentleman highlights how this issue affects communities right across the UK, and in a moment I will turn to the criteria by which the locations of banking hubs are decided—hon. Members have raised that important issue, and put on record their concerns and feelings about it.

Banking hubs offer counter services provided by post office staff, which allows personal and business customers of more than 30 banks and building societies to withdraw and deposit cash, deposit cheques, pay bills and check their balance. They also, crucially, contain rooms where customers can see community bankers from their bank to carry out wider banking services, such as registering a bereavement or help with changing a PIN. As the hon. Member for North Dorset pointed out, banking hubs offer more than just access to cash—that is an important point regarding why such hubs can bring so much to an area that has otherwise lost its local banks.

Community banking hubs can clearly contribute a great deal to local areas where existing banks have closed, and decisions over the opening of a hub are guided by the Financial Conduct Authority’s regulations. In response to the question from the hon. Member for Strangford (Jim Shannon), it may be helpful for me to briefly outline how the FCA’s process works. When a bank announces a closure, Link, the operator of the UK’s largest ATM network, conducts an impartial assessment of a community’s access to cash needs. Link considers criteria such as population size, the number of small businesses and levels of vulnerability, as well as the distance to the nearest branch, and the cost and time taken to get there via public transport.

Should Link recommend a banking hub, Cash Access UK, a not-for-profit entity funded by major UK banks, will implement it. Crucially, a bank branch cannot close until any recommended services are in place. Additionally, individuals, including Members of Parliament, can directly request an access to cash review via the Link website. In collaboration with industry, the Government remain committed to advancing the roll-out of these hubs.

It is worth pointing out that customers have alternative options for accessing everyday banking services. Notably, 99% of personal and 95% of business banking customers can conduct their banking, including taking out and depositing cash, at over 11,500 Post Office branches nationwide. The Post Office, as several hon. Members have mentioned, has a duty to serve rural communities, with the Department for Business and Trade requiring that 95% of the total rural population across the UK be within three miles of a Post Office. Therefore, where communities might be too small for a banking hub, as may be the case for some of the rural communities we are focusing on this evening, individuals and businesses can still access essential services at their local Post Office.

Crown Estate Bill [Lords]

Debate between James Murray and Jim Shannon

Report stage
Monday 24th February 2025 Commons Chamber

[Jim Shannon]

I seek assurance that the ambitious net zero targets will not detrimentally affect the fishing sector. I remember some years ago there was talk of a wind farm just off the coast of Kilkeel, and the fishermen were concerned that it would be in one of their prime fishing sectors, where scallops were plentiful. If that continued, the fishing sector could lose out because the Government decided to push for net zero. I sought reassurance that Northern Ireland MPs would be able to contact the Northern Ireland commissioner directly, but I ask specifically for a wider assurance about the fishing sector in Northern Ireland—for Portavogie, Ardglass and Kilkeel.

[James Murray]

I thank the hon. Gentleman for his intervention about the impact on the fishing sector, and I can reassure him that the Crown Estate is committed to the sustainable management of the seabed. As with any developer, the Crown Estate’s proposals go through the standard planning approval process, which includes the relevant environmental assessments. Under the Crown Estate’s strategy, it has an objective to take a leading role in stewarding the natural environment and biodiversity. Key to delivering on that aim is managing the seabed in a way that reduces pressure on, and accelerates recovery of, our marine environment. Of course, the Bill will not impact directly on how much commercial fishing takes place in areas managed by the Crown Estate.

I pointed out that the inclusion of clause 6 in the Bill in the other place provided for the appointment of commissioners responsible for giving advice about England, Wales and Northern Ireland. The requirement to give advice to the board about Wales will be alongside the commissioners’ existing duties. That change will strengthen the Crown Estate’s ability to deliver benefits for the whole UK.

Hon. Members may not agree with the points I have made, but I hope that I have set out clearly why the Government believe that the existing structure remains the best approach, and I hope that hon. Members will feel that they do not need to press their new clauses to a vote.

New clause 2, which was tabled by the hon. Member for South Cambridgeshire, would require the Crown Estate to ensure that any decisions about marine spatial priorities are co-ordinated with the priorities of the Marine Management Organisation, and to consult any communities or industries impacted by the plans, including fishing communities. I confirm that the Crown Estate and the Marine Management Organisation already have well established ways of working together to ensure effective collaboration for marine spatial planning and prioritisation.

Agricultural and Business Property Reliefs: OBR Costing

Debate between James Murray and Jim Shannon

Thursday 23rd January 2025 Commons Chamber

[James Murray]

I am not going to tell the hon. Gentleman what he should say to his constituents, but what I can tell him about the Government’s policy is that we have reserved generous inheritance tax reliefs for people in the situations he describes. I encourage anyone who is concerned to seek advice, to understand exactly how the new rules might apply to them.

[Jim Shannon (Strangford) (DUP)]

Sometimes I am absolutely flummoxed—we probably all are—by the Chancellor’s intent to tax working family farms, which we all know will result in the loss of small farms, the sale of the land and a reduction in food security. Now it seems that the OBR agrees that it will not make savings. Will the Minister commit to meeting Cabinet colleagues urgently to remove the sword of Damocles that is hanging above small family farms and hurting the agrifood sector as a whole? I say to the Minister that there is a way forward: increase the threshold from £1 million to £5 million, and family farms will be saved.

[James Murray]

I thank the hon. Gentleman for his question, but I think it was based primary on the OBR publication yesterday. I reiterate the point I have made several times now: that OBR publication reiterated the costings and figures set out at the Budget, it reiterated the level of uncertainty associated with the measure, as published at the Budget, it provides more detail behind that, but the conclusion is the same as it was on 30 October.

Non-Domestic Rating (Multipliers and Private Schools) Bill

Debate between James Murray and Jim Shannon

2nd reading
Monday 25th November 2024 Commons Chamber

[James Murray]

The hon. Gentleman raises a crucial point about ensuring that the tax system is fair and that it supports the behaviour that we seek to incentivise.

That leads me neatly to my next point. As part of the discussion paper on transforming business rates, we have committed to consulting on adopting a general anti-avoidance rule for business rates in England. Although that might not necessarily address the exact problem the hon. Gentleman highlights, it speaks to the general issue of avoidance in relation to business rates.

We will also look at how the burden adjusts with the economic cycle, and we will assess the merit of a further increase in the frequency of re-evaluations. I look forward to working closely with businesses and representative organisations to deliver a business rates system that is fit for the 21st century, and that work begins today with the powers in this Bill to deliver our permanent tax cut for high streets.

As I said earlier, the tough decisions that the Chancellor set out in the Budget to deliver economic stability and fix the public finances enable us to give businesses the confidence they need to invest, and to get public services back on their feet. One public service that is crucial to breaking down barriers to opportunity is the education system, which is why the Government have prioritised ensuring that every child has access to the high-quality education that they deserve.

[Jim Shannon (Strangford) (DUP)]

Like others, I have repeatedly raised the need for exemptions for religious schools. For the Free Presbyterian Church in Northern Ireland, for example, the expression of its faith and treasured beliefs does not sit comfortably with mainstream schooling, and it is the same for many other faiths. If the Government are determined to press ahead, does the Minister agree that exemptions must be made, at the very least, for such schools? On behalf of those Churches, those faiths and those people, I have to say that the Government must think again.

[James Murray]

I thank the hon. Gentleman for a rare intervention, but this Bill is about business rates in England. Some of his wider points may relate to the removal of the VAT exemption for private school fees in other countries and nations of the UK. Those provisions will be debated as part of the Finance Bill on Wednesday and, if he repeats his comments, I might be able to address them more specifically.

Today, we are addressing the business rates system that applies in England. This is important because every parent aspires to get the best education for their child, and we as a Government are determined to ensure that those aspirations are met. At the Budget, the Government announced a real-terms increase in per pupil funding, with a £2.3 billion increase to the core schools budget for the financial year 2025-26, including a £1 billion uplift in high-needs funding.

This funding increase needs to be paid for so, to help make that happen, the Government are ending the tax breaks for private schools, as set out in our manifesto. This includes ending charitable rate relief eligibility for those private schools in England that are charities. This Bill will do that, and its measures operate alongside the ending of the VAT exemption for private school fees, which is being delivered through the Finance Bill that I will be moving on Wednesday. Together, these measures will raise £1.8 billion a year by 2029-30.