Local Bank Closures

Jamie Stone Excerpts

Wednesday 12th June 2019 Westminster Hall

[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.

--- Later in debate ---

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

It is a great pleasure to serve under your chairmanship, Ms Ryan.

I want to draw Members’ attention to the county of Sutherland in the highlands, which is part of my constituency. Since 2005, eight branches have shut. With the recent announcement that the Clydesdale is going to shut its branch in Brora, we will be left with precisely one branch, the Bank of Scotland in Golspie, in a very large county of 2,028 square miles, with a population of some 13,500 who will have only one branch left. For some people that means a 150-mile round trip to get to the bank, if someone lives in Durness in the upper north-west—a three and a half hour bus journey for my constituents. And it gets worse. We have talked about post offices and how the banks say, “Go online or use the post office,” but Clydesdale bank seems to have conveniently forgotten that the post office in Brora has been shut for some time, making a complete mockery of that.

I and other Members have always said that the point of having a real branch is to have a human face behind the counter. Even if people can go online—not a lot can in my constituency—if someone has a big payment coming along but they do not know what it is, which can be a real worry for people, old and young, it would be better if they could go into a branch and see somebody who would say, “This is what it is,” or, “This is a scam.” That is why we want the human face, which is very hard to replace.

In my huge constituency, we are told to use mobile banks, but it is not awful funny going to a mobile bank in Wick if it is sleeting in January. The weather in good old Wick can sometimes be very inclement.

My contribution is short, but the matter of Sutherland serves the purpose of helping all Members here today, because it provides such an extreme example: one branch in a vast county of 2,028 square miles, which is astonishing. However, I give credit where it is due to the Minister. He has met and listened to a cross-party group of MPs, and I think he has taken the issue on board, but I say to him from the bottom of my heart that we have to get something together. The hon. Member for Moray (Douglas Ross) made a superb speech. This is about getting the hubs to work. Where there is a will, there is a way before us. If we could get those hubs to work together that would not solve the problem, but it would make things a heck of a lot easier, so I say to the Minister, “Go and bang the banks’ heads together. Tell them to get off their backsides and get the show on the road!”