Covid-19: Government Support for Business

Margaret Ferrier Excerpts

Thursday 16th December 2021 Commons Chamber

[John Glen]

As ever, the hon. Lady makes a reasonable point. We have to look at the range of interventions and ways that we could support the economy at this time. She raises an interesting area for us to focus on, and I am sure that will be a substantive area of considerations with the Chancellor.

[Margaret Ferrier (Rutherglen and Hamilton West) (Ind)]

The music industry has been hit hard. The industry trade body LIVE—Live music Industry Venues and Entertainment—has concerns that while venues can technically stay open, they are haemorrhaging money and that will lead to permanent closures. Will the Chancellor maintain the current rate of VAT beyond March 2022? In addition to support packages, will the Government fix the insurance scheme for cancelled events to include pandemic-related cancellations?

[John Glen]

I thank the hon. Lady for her question. The Government worked very closely with the sector in the determination of the parameters of the live events reinsurance scheme—I was involved in it myself—over late summer. That £800 million scheme will give events across the country confidence, but I obviously recognise that that needs to be kept under constant review, as all the measures do.

Financial Services: UK Economy

Margaret Ferrier Excerpts

Thursday 9th December 2021 Commons Chamber

[Margaret Ferrier (Rutherglen and Hamilton West) (Ind)]

It is a pleasure to follow the hon. Member for Wimbledon (Stephen Hammond).

I thank the Backbench Business Committee and the three sponsors of today’s debate for bringing this topic to the House for discussion. The UK’s financial services are a huge asset and truly world class. The UK’s sector is the third largest of the OECD countries in terms of its economic output. Recent rankings put London’s financial market as the second most competitive in the world, only narrowly beat out by New York. It is therefore unsurprising that even within the UK London holds the lion’s share of the glory. The city’s contribution to the UK economy for the sector accounts for 50% of the sector’s economic output, but, interestingly, Scotland ranks just behind London and the south-east; it is a very well-established financial centre. So while London might sit firmly centre-stage, contributions from across the UK should also be celebrated.

In fact, Scotland has a rich history as a thriving financial hub, one that spans over 300 years. The Institute of Chartered Accountants of Scotland was the world’s first professional accounting body, established in 1854. The Chartered Banker Institute—or as it was originally known the Institute of Bankers in Scotland—was established in 1875, making it the oldest banking institute in the world. Today there are around 84,000 jobs in the sector in Scotland, and around 2,000 businesses. The FinTech industry is growing too, with many firms looking to establish homes in Glasgow and Edinburgh. Many cite the excellent provision of local skill and talent as the reason for wanting to do so. It is attractive to foreign direct investment, too.

Like so many of the UK’s industries, the financial sector has not escaped unscathed from the realities of Brexit. Financial services were largely overlooked in the trade and co-operation agreement, so provisions are relatively sparse. According to the Financial Times, there are 90 mentions of financial services in the agreement, but variations of the word “fish” appear 368 times. In December last year the sector lost passporting rights and we moved into market access determined through equivalence. The deal we came away with was not a good one and, as expected, many businesses moved to other European financial centres where they have access to the single market. Jobs and business have been lost and perhaps still will be, but we will not know the true impact for a long while yet.

The sector’s economic contribution is substantial, as we know. A recent study showed that Scottish businesses had an average profit margin of 7.5%, above the UK average and second only to London. Financial services are a big part of the reason that average is so high. The sector’s profit margin in Scotland is 13.6%. Its tax contribution is impressive too, at £28.8 billion in income tax, national insurance, corporation tax, bank payroll tax and the banking levy last financial year. That is 4.1% of all taxes collected last year.

What is next? How do we build on what we have and mitigate the impact of leaving the single market? The Government’s answer seems to be deregulation, although industry experts seem to be not wholly in agreement about the impact that will have. I would be interested to hear what discussions the Minister has had with the sector about deregulation, and how that has informed the Government’s strategy. Have the Government considered the argument for reregulation—a reshaping of the current framework so that it is more suitable—rather than deregulation?

Financial services policy remains reserved to the UK Government, and I urge them not to overlook the sector’s prominent Scottish presence as they review and reform their policies in a post-Brexit context.

Community Debt Advice Services

Margaret Ferrier Excerpts

Wednesday 1st December 2021 Westminster Hall

[Emma Hardy (Kingston upon Hull West and Hessle) (Lab)]

I beg to move,

That this House has considered reductions in community debt advice services.

It is a pleasure to serve, even if very briefly, under your chairship, Ms Fovargue. I thank my hon. Friend the Member for Kingston upon Hull East (Karl Turner) and my right hon. Friends the Members for Kingston upon Hull North (Dame Diana Johnson) and for Wentworth and Dearne (John Healey), who have supported me on this issue from the very beginning and who are all here today.

I will start by giving a brief outline of the cost of living crisis and then go into the importance of face-to-face debt advice, before looking at the potential model that the Money and Pensions Service will introduce and finishing with my specific requests for the Minister. For brevity, I will refer to the Money and Pensions Service as MaPS; otherwise, we will end up spending an awfully long time just on the title.

A survey by the Joseph Rowntree Foundation in early October this year showed that the number of UK households that are behind on rent, bills or debt repayments has trebled since the pandemic hit, and now stands at nearly 4 million. The pandemic has dragged families who were previously just about managing into arrears on essential bills, and we know that economic pressures are getting worse. Those in receipt of universal credit are beginning to feel the effects of the £20-a-week cut—a cut that Labour, of course, opposed. The ban on evictions has ended, domestic fuel prices are rising and the collapse of providers means that many people have already been transferred to new companies on higher tariffs. As fixed-term plans end, more people will face increased energy bills, and that is before the energy cap is uplifted in April. The Chancellor has it in his powers to reduce VAT on fuel but has chosen not to do so. Workers also face an increase in national insurance. Inflation is rising and is now around 4%, and many expect it to remain at that level until mid-2022.

This is all creating a cost of living crisis, and an increasing number of people will find themselves needing advice and support with debt—many for the first time. Currently, debt advice is provided by a network of local providers and national charities such as Citizens Advice, and they are funded through nine regional grants from MaPS.

[Margaret Ferrier (Rutherglen and Hamilton West) (Ind)]

Outside the usual services, a number of charities I have met recently have reported that people are approaching them for debt advice or asking to be signposted. The third sector is already struggling to obtain funding in my constituency. Does the hon. Lady agree that it is unfair to expect charities to shoulder most of the burden?

[Emma Hardy]

I absolutely agree. As I have outlined, we expect more people to seek debt advice, and the burden will fall on those who provide it at the moment. I pay tribute to all those who currently provide support and debt advice. Some are volunteers, but they often deal with complex cases and they work with sensitivity and compassion to help people at extreme times of personal crisis. Over 100,000 people attempt suicide each year because of debt, so the services that these organisations provide can literally be life-saving.

Lots of people need face-to-face debt advice for a huge a variety of reasons. There is the obvious reason—that they do not have the technology or the internet—but it is not just that. Debt advice clients are often vulnerable. For many, this is due to personal factors such as disability, language barriers, alcohol or substance abuse or mental health conditions. In fact, debt advisers tell me that 82% of their clients have concerns around mental health. But many others are vulnerable due to a change in circumstances—to quote the famous phrase, “We are all just two pay cheques away from being in the same situation.” People get into debt because of bereavement, loss of employment, poor health or domestic abuse. Face-to-face advice provides a safe, supportive environment for a person to seek help.

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[Yvonne Fovargue]

I thank my hon. Friend for that intervention, and I will be moving on to discuss the wraparound provision, which does not just cover debt advice. We cannot just see debt as the problem: the important thing is the person who has the problem, and we have to deal with all their problems through that person-centred approach. It is no good just dealing with a person’s debt if they also have an employment problem or a housing problem that needs to be solved. We have to look at everything in the round.

[Margaret Ferrier]

Understanding how to manage our money effectively can be really hard, as well as support after debt has been accrued, so does the hon. Member agree that real-life money management education should be provided much earlier in life?

[Yvonne Fovargue]

I do agree, but I do not think there is a silver bullet. Some of the problem is that there just is not enough money to go around, and it does not matter how well a person manages their money if they do not have enough to go around. Money management education is one of the tools of the trade, but it is not a silver bullet.

As I was saying about the new MaPS contract, it is good to look at the wellbeing of the advisers. I have heard that the debt advice peer assessment scheme has caused advisers considerable strain, with people having to do two web chats at once, which is really not feasible: they have to concentrate on the individual. This focus on wellbeing is acceptable, but I worry about the nine regional branches for debt advice going. About half of the money will go to the three national digital and phone-based services centres in the north, the midlands and the south, which will largely be at the expense of face-to-face provision, and providers can bid for only two of those. That element of competition worries me a bit. We all know that advice agencies are competitive: we have had to be, because we are competing for a limited pot of money. However, setting people up against each other is not the way to do it. Collaboration is the key with advice agencies, and we need to see more of that. I do not disagree with contracts—I think they are a way forward—but I do think we need to look at the way in which the contract is tendered and, in particular, how it can promote collaboration.

The 50% cut in the regional services is another worry. As my hon. Friend the Member for Kingston upon Hull West and Hessle said, it is vital that there is partnership between the local agencies, and those partnerships are often built up on the ground with local knowledge. As my right hon. Friend the Member for Kingston upon Hull North (Dame Diana Johnson) mentioned, it is the wraparound casework support; the writing and phoning creditors; the knowledge of bailiffs in the area and how the local authorities work; and having those personal contacts that are vital. We know that people who have mental health issues often need the comfort of a face-to-face service. They may well be able to move on to a telephone service at some point in future, but an experienced adviser will be able to say when that point is.

I am also concerned about the nature of the contract. A number of smaller agencies are being put off from bidding because payment in arrears is a real problem. Advice agencies cannot cope with payment in arrears. They need to know that the money is there up front. They are not paying their advisers and rent in arrears; they are paying for everything and it is a month-on-month worry. The full responsibility for the TUPE arrangements is a problem, as is clawback, which needs to be specified as to the quality targets and the amounts.

I am pleased that in my discussions with MaPS it said it would not be a month-on-month target, because all of us in the advice field know that December sees a drop in cases, whereas January and February see a big rise. The demand for debt advice is not stable month on month; it goes up and down. I would also like to see time targets, not numbers. Number targets encourage short, easily dealt with cases, whereas the people who need face-to-face support need time to deal with complex debts and the emotional and other associated issues.

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[Jim Shannon (Strangford) (DUP)]

It is a pleasure to speak in this debate, Ms Bardell. I congratulate the hon. Member for Kingston upon Hull West and Hessle (Emma Hardy) on setting the scene and thank her for that. This is a massive issue, not just in the hon. Lady’s constituency, but in my own. In our office, we deal with those who have extreme financial difficulties every day and every week. I will give a couple of examples, without mentioning any names.

In Strangford, the CAB, Christians Against Poverty, church groups and other groups provide community debt advice services; those are the groups that I work with on most occasions. There has been an increase of at least 30% in gas, electricity and oil prices in Northern Ireland, and cold weather and an extreme winter are predicted. Food prices are up by as much as 20% in some places and there is the additional pressure of Christmas, with the expectation that many families feel forced to live up to. We all know about that because we talk to our constituents. When children see something at school that their friends have, there is almost an onus on the parents to make sure their children get the same thing. That is not a criticism; it is the nature of how we live in our lives, but it adds a huge burden to low-income families, with recent reports citing that families will spend an average of £300 per child. That does not include spending on other family members.

For me, Ms Bardell, Christmas is a time to enjoy being with family. I have three boys who are 32, 30 and 28, three daughters-in-law and five grandchildren, so for me Christmas is time to spend with my grandchildren. The good thing about being a grandparent is that at 7 o’clock at night I can give them back. We have all had those joys as parents; when they have a tantrum, or they get a bit tired but they do not want to go to bed—or they do want to go to bed.

[Margaret Ferrier]

A lot of people are not aware that Christmas spending is something that can be accounted for in income and expenditure forms when dealing with debt. Does the hon. Gentleman agree that the need for better awareness when dealing with debt does not mean losing that quality of life as well?

[Jim Shannon]

We do not want to lose quality of life, but we do need to deal with the reality of life. The hon. Member for Makerfield (Yvonne Fovargue) outlined in great detail the issues that most families feel—and address. It is easy for me to talk about time with the family, because it is my wife Sandra who chooses the Christmas gifts. She is better at it than me, and knows what the children want. The money we spend is disbursed as she sees fit. However, for other people, it will be a juggling exercise between buying Christmas presents and being able to afford the oil and electric bills. That is the issue and that is why I am here to speak on behalf of those constituents who are under great pressure.

The security is not there for many families. Rather than seeing disappointed faces on Christmas morning, people make purchases and live with the debt for months to come. Last week, in my local press back home, there was an indication that this year in particular, the issue for those who have maxed out their credit cards is that they will turn to payday loans. I have forever cautioned against that, because the reality will be extreme. There will be a pain-free two weeks, but then there will be a very painful month after Christmas. I have extreme concern for those people.

Access to Cash

Margaret Ferrier Excerpts

Wednesday 20th October 2021 Westminster Hall

[Ronnie Cowan (Inverclyde) (SNP)]

I congratulate the hon. Member for Pontypridd (Alex Davies-Jones) on bringing forward this debate.

Of course, most of us still want access to cash. For some, it is still their preferred method to manage their incomes and their outgoings; for many, it is still something they use—less frequently, but it is still required. I read with interest this morning on the BBC that:

“People are taking out more money when they visit ATMs, with the average amount climbing more than £10 to just under £80 in the last two years.”

My immediate thought was, “Cash is making a comeback,” but the next line said:

“But they’re using cash machines 40% less than before and withdrawing £44 a month less.”

I thought, “Is this because there are fewer ATMs? When people find one, are they taking out more money, so that they do not run out before they find another one that is working and is free to use?” However, Nick Quin, head of financial inclusion at LINK, has said:

“Covid has turbocharged the switch to digital”.

While cash usage is down in every constituency in the country, some have seen a 20% drop, while others have seen a drop of as much of 60% over the same time. Different parts of the UK are moving at different rates. It comes as no surprise that the most deprived areas of the country are likely to be using more cash than the wealthiest. Some 5 million people still rely on cash, and as we have heard, and 1 million people do not have a bank account. The average adult withdrew £1,500 in 2020. Cash will remain an important part of life for many people for a long time to come. That is reflected in the UK Government statement that they are

“preserving the long established, traditional services like cash that are integral to people’s lives.”

However, the reality is somewhat different. Access to cash is getting harder.

In my constituency of Inverclyde, the number of free-to-use ATMs has dropped from 87 to 68 in three years. Across Scotland, there has been a 16% reduction, which is compounded by the loss of 400 bank and building society branches, a 34% reduction—which in truth leaves me none the wiser, because I do not know what we are doing as a society. Are we working towards a cashless society? Is it the UK Government’s belief that we are moving towards a cashless society? If so, what is their timescale?

I have a number of issues with a cashless society that have to be addressed. For it to work, we require technology that is robust, secure and available 24/7. Currently, it is not. Only last Saturday, mid-way through preparing a meal for friends, I realised that I was missing a key ingredient. I went to my local convenience store, and there on the front door it said, “Cash only”, with a sign on the ATM saying, “Out of order”. By good luck rather design, I had a fiver in my wallet, and my Nigella Lawson fish curry was a huge success. Cash saved my curry, but what if we had relied on entirely on cashless transactions? What if there was a serious situation, where somebody had to pay a bill to stop the electricity being cut off or needed to pay for a taxi, bus or train to get to a loved one in distress, and cash was a thing of the past and the technology had been compromised?

What I am looking for from the UK Government is a destination and a plan. I remember when we transitioned from old money to decimal. It was a perfectly natural thing for me—as a very young child—but I had to try to explain to my gran, who was used to 12 pence to shilling and 20 shillings to the pound, that, from 240 pennies in a pound, there was now going to be 100. “Where’s my other 140 pennies?” She was baffled by this. To handle these concerns, there was a UK-wide advertising campaign to explain where we were going, what it would mean and how we would get there. If people’s fears are to be allayed and those that require cash are not left behind in a two-tier system, we need to look at a hybrid system that accommodates cash and electronic transfers. To make it work we need a strategy that encompasses a network of ATMs on the high street and in convenience stores with post office services and bank counter services. We need cash without purchase and banking hubs that serve our communities.

[Margaret Ferrier (Rutherglen and Hamilton West) (Ind)]

Will the hon. Gentleman give way?

[Ronnie Cowan]

I am sorry, but I do not have time. Most importantly, the roles of each part of the system need to be clearly defined so that they complement each other, and when technology fails there must be a safety net to ensure that people can still top up their meters, purchase food and access public transport.

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

I begin by thanking the hon. Member for Pontypridd (Alex Davies-Jones) for bringing this debate forward. I share her sincere and passionately held views on the issue; I and many other Members have participated in access to cash debates on umpteen occasions. Despite the huge consensus on what we need to do and what the problems are, I do not see much change, but we all agree that we need direct Government intervention to halt the decline of cash and to protect access to cash for our communities. I echo the words of the hon. Member for Blackpool North and Cleveleys (Paul Maynard): we need to just “get on with it”.

The access to cash Bill will be an important piece of legislation, but we need to see it. Covid has placed our cash infrastructure in an even more precarious situation. We need clear protections for the future of cash payments which, as we have heard, are so important to so many people, including those who simply do not have the option to pay by card and those who simply want to pay by cash for budgeting or other reasons. As my hon. Friend the Member for Inverclyde (Ronnie Cowan) reminded us, more than 5 million people still rely on cash, and that must not be forgotten. Cash transactions are very important for many people, and will remain so for considerable time to come. We have heard as much from every single Member who has spoken today.

Alongside that is the loss of free-to-use ATM cash withdrawals. We know that withdrawals from cash machines dropped significantly at the height of the covid pandemic. My fear, which I know is shared by Members around the Chamber, is that that will feed further closures of free cash machines across our communities. Increasingly, ATMs are charging for access to cash, and I am afraid that the situation is becoming normalised.

[Margaret Ferrier]

Will my hon. Friend give way?

[Patricia Gibson]

I just want to make this point. To help address the situation, we need to make sure that banks pay their fair share so that their customers can get free access to cash. By cutting the interchange fee, banks have saved £120 million, but the financial brunt is being borne by those who live in less affluent communities. That is a disgrace. The more affluent the area in which someone lives, the less likely that they will be required to access their own cash through an ATM. That is unjustifiable by whatever measure we care to use. It is another example of banks expecting others to pay for the so-called service that they want to provide. They do not properly renumerate post offices for taking over basic banking, which they have abandoned in so many of our communities, nor do they properly renumerate the ATM providers.

A pattern is emerging and the banks need to explain themselves. It seems to me that they are simply not fulfilling any social obligation or any duty of care either to those to whom they expect to provide a service or to those that provide that service on their behalf. If the access to cash Bill is to make any real difference, it must hold them to account for their responsibilities.

Of course, it is welcome that the Financial Conduct Authority is to oversee access to cash and provide analysis of what needs to be done where in order to support it. The issue has become more critical because banks have left gaps in our provision. As a result, our sub-postmasters need more financial support. Banks need to stop taking them for granted, given the essential role that they play in our communities, doing the job that banks are no longer interested in doing. It is worth remembering that throughout the pandemic, post offices continued to serve our communities and we relied on them then, as we do now. Many banks closed their doors during the pandemic. So much is expected of our post offices, but sub-postmasters are leaving the service because they are under so much financial pressure. Many are simply shutting up shop, as it is much more challenging to make a living now.

Sadly, post offices have been systematically run down over the years by successive Governments. I remember the 2000s, when the previous Labour Government stripped post offices of many of their functions. Then, in 2008 it was announced that 2,500 small and rural post offices would have to close, with Scotland disproportionately hit with 600 closures, six of which were in my constituency of North Ayrshire and Arran. Since then there have been so many bank closures that seven towns in my constituency—Kilbirnie, Kilwinning, West Kilbride, Stevenston, Ardrossan, Dalry and Beith—have no bank at all.

Now we have an access to cash crisis, with sub-postmasters expected to do so much of the heavy lifting without being properly paid to do so. The threats to our cash infrastructure, with the banks abandoning our towns, with sub-postmasters under intolerable financial pressure, with free access to cash being increasingly difficult to find and with many being increasingly locked out of paying by cash, mean that urgent action is needed if we are to protect our financial infrastructure and ensure that we have a society where financial inclusion matters.

The situation is critical, and the contents of the access to cash Bill will be the crossroads where the Government have a real opportunity to step in to do something to stop the decline. I think we can all agree on what needs to be done, but we need to start with the banks and their responsibility to communities and consumers. I look forward to the Minister’s telling us more today about the meaningful actions he expects the access to cash Bill to provide and when we can get sight of it. The future of our financial infrastructure depends on that Bill, so its content will determine the future of cash.

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

What a pleasure it is to serve under your chairmanship, Mrs Miller. I commend the hon. Member for Pontypridd (Alex Davies-Jones) for her speech and for securing the debate. She set out many of the core issues and gave a very fair assessment of them, which was echoed by the 13 speeches from Back-Bench Members and three interventions that we have heard this afternoon.

I have been the Minister for this issue for quite a long time, and I very much feel the urgency in resolving it while I am still around. I appreciate having the opportunity to update hon. Members on the Government’s efforts to protect cash and, in particular, the recent consultation on legislation to do exactly that.

As a number of colleagues said, many people still rely on cash and the infrastructure that delivers it. It is changing rapidly, but we need to recognise that it is an imperative for everyone’s daily life. That is especially the case for more vulnerable groups, be it in Pontypridd or in my constituency of Salisbury. Just today, we have seen more bank branches close, including one in Amesbury in my constituency. My hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard) once again showed his encyclopedic understanding and depth of knowledge and powerfully expressed the urgency with which we must address the matter.

During the pandemic, there was evidence of access to cash being stretched. However, I am pleased that the Treasury was able to work closely with financial regulators, such as the FCA, and industry to maintain that access while protecting the safety of staff and customers. The vast majority of people were able to get hold of the cash they needed throughout the pandemic. Indeed, the share of the UK population who lost access to a source of cash within three miles during spring 2020 never exceeded 0.1%. In this conversation, I have always been very aware of the fact that—as the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone), with whom I have met separately, said—we have to deal with a very wide range of constituency interests, with very urban constituencies and very sparsely populated constituencies. That guides me as I contemplate what next to bring forward from the Government’s perspective.

[Margaret Ferrier]

With the closure of many high-street bank branches, many communities are finding it hard to get essential access to physical money. A pilot post office bank hub in Cambuslang, in my constituency, provides face-to-face services for customers. Would the Minister agree that the scheme could be rolled out UK-wide?

[John Glen]

I am very grateful to the hon. Lady for raising that point. I visited her constituency last Thursday and saw that facility first hand, and I will say a little bit about it in a moment. It was a great example of banks coming together and working with the Post Office to find a practical solution—one that many colleagues in the Chamber have raised in previous debates.

We are in a strong position to build on our success in meeting the needs of local communities across the country over the long term. Access to cash across the UK remains extensive. Over the last year, the Financial Conduct Authority and the Payment Systems Regulator have undertaken important work to map cash access points across the UK. That has shown that access remains comprehensive, even though it is evolving. As of the first quarter of this year, more than 95% of the population were within two kilometres of a free cash withdrawal point. I would say to the hon. Member for Pontypridd that, as of August 2021, Pontypridd itself had 76 ATMs, 50 of which were free to use.

However, we are in no way complacent about access to cash. I recognise that we need a range of solutions. We understand that cash remains important for millions of people across the UK. That means that we have a responsibility to protect the cash system and ensure that it is sustainable. That means two things: being innovative in the provision of cash while ensuring that we maintain sufficient coverage.

The Government have already taken decisive action in a number of ways to support the widespread availability of cashback without a purchase from shops and other businesses, including legislative changes as part of the Financial Services Act 2021. That is a significant step change, and the industry is really on board with it. We have already seen the success of cashback without a purchase as part of the community access to cash pilots, which are trialling bespoke cash access solutions across a number of areas.

The hon. Member for Harrow West (Gareth Thomas) raised the issue of the role of credit unions. On my visit to Glasgow last week, I was pleased to meet with Glasgow Credit Union and discuss some of the legislative changes required to allow them to expand the provision of services. The notion of a bespoke solution in individual communities is very much uppermost in my mind as we move forward. It was great to hear how well received those pilots have been by the local community in Cambuslang, where I visited the post office bank hub pilot and saw at first hand the impact that innovative industry solutions can have. The hub is a post office counter service, and different bank representatives come there on different days. When a customer’s bank representative is not there, other representatives can also help them.

I am delighted by the industry’s announcement that, following the Government’s changes to the law, cashback without a purchase will be rolled out to thousands of shops over the coming months. When it comes to ATMs, LINK, which, as a number of hon. Members have mentioned, runs the UK’s largest ATM network, remains committed to protecting the broad geographic spread of free-to-use ATMs, and it is held to account against that commitment by the Payment Systems Regulator. The Government also continue to fully support the post office banking framework agreement, which allows 95% of business and 99% of personal banking customers to deposit cheques, check their balance and withdraw and deposit cash at the nation’s 11,500 post office branches. The Access to Banking standard and FCA guidance force the banks to look at their mitigation responsibilities to maintain face-to-face banking services in situations where branches close.

On top of that, the Government are doing more. As several hon. Members have mentioned this afternoon, we have been developing new legislation that will enable us to protect cash over the long term. The most recent step in that process was the consultation on proposed legislation, which closed less than a month ago, on 23 September. That consultation was designed with a simple principle in mind: finding that crucial balance between supporting the use of cash and embedding flexibility as the cash landscape continues to evolve.

At the most fundamental level, that has meant setting out proposals for new laws to ensure that people need to travel only reasonable distances to pay in or take out cash. Through our actions to date and these proposals, we seek to support the continued use of cash in people’s daily lives, including supporting local businesses in continuing to accept cash. The consultation also set out proposals on what sort of organisation should be within scope of legislation to ensure that industry, especially banks, continues to play a key role in supplying cash, be it through their own branches or through funding customer transactions at ATMs or post office counters.

It is crucial, of course, that any legislation is coupled with appropriate regulatory oversight, and that has been another important aspect of the consultation. We want regulators to have appropriate powers and responsibilities, but without imposing unnecessary burdens on businesses. We believe that the FCA is best placed to play the leading role in holding firms to account on access to cash, so that the needs of consumers and businesses are met.

The Government also intend the Payment Systems Regulator and the Bank of England to maintain their existing functions regarding retail cash. As I mentioned earlier, the co-ordinated actions by the FCA, PSR and the Bank of England on cash as part of the covid-19 response have shown that co-operation between the regulators at both strategic and operational levels works well.

For all that the Government are doing to preserve access to cash, it is also worth acknowledging that the trend away from the use of cash towards cards and other digital payments has been both significant and accelerating over the past 18 months. That brings with it many opportunities, such as the potential for cheaper and more tailored payments, as set out in the Government’s recent response to the payments landscape review call for evidence, which was running in parallel.

It is important that digital connectivity is in place to help individuals and businesses to seize those opportunities, as has been mentioned by many hon. Members this afternoon. That is just one of the reasons why the Government are striving to ensure that no one is left behind in the transition to digital. To improve digital connectivity, the Government’s £5 billion Project Gigabit is helping to deliver lightning-fast, reliable broadband, including in Wales and therefore in towns such as Pontypridd.

We are working with industry to target a minimum of 85% gigabit-capable coverage by 2025, and will seek to accelerate roll-out further to get as close to 100% as possible. Action is also being taken to improve mobile connectivity in rural areas, recognising the challenges of getting to that complete coverage. The Government are providing £510 million for the shared rural network, and by 2025 that will expand 4G mobile coverage to 95% of the UK.

Out of respect for the hon. Member for Pontypridd, I looked into what is happening in Wales. The shared rural network programme is helping to reduce partial mobile phone notspots in Wales, and in the South Wales Central area, where her constituency is located, 4G coverage from all four operators will increase from 82% to 90% by the end of the programme.

Our consultation on proposed legislation closed on 23 September and the Government will set out the next steps in due course. I hope hon. Members will understand that it was only three and a half to four weeks ago, but I acknowledge the urgency that has been expressed this afternoon. I take it to heart, and I recognise the determination to get this done as quickly as possible.

I also acknowledge the recognition by my right hon. Friend the Member for Dumfriesshire, Clydesdale and Tweeddale (David Mundell) of the imperative for banks to come forward with proposals. The Government are always open to constructive suggestions from the banks as to what they wish to do in the meantime, but I cannot say much more at this stage. What I will say is that the Government remain absolutely determined and committed to legislate to ensure that people have access to cash over the long term. In doing so, we need to strike a balance between, on the one hand, being open to innovation and, on the other, ensuring that people are not financially excluded by losing access to cash. That is what we will do.

I sincerely thank Members for their thoughtful and constructive advice and contributions, and I can assure them that I will continue to work with Members from across the House. I do not see this as a partisan matter at all. I will continue to hear from them and to work with them to come up with an enduring solution next year and beyond.

Working People’s Finances: Government Policy

Margaret Ferrier Excerpts

Tuesday 21st September 2021 Commons Chamber

[Jessica Morden]

My hon. Friend is spot on. It is indeed a perfect storm, with all those factors coming together at the same time.

Petrol and diesel are also more expensive, costing more than they have since 2013, and the cost of buying a home has skyrocketed in Newport East. Home-Start Cymru has highlighted the huge rise in prices in Monmouthshire, and we have seen the same in Newport. That has put the opportunity to buy beyond many people, particularly our local young people trying to get on to the housing ladder. Housing insecurity has increased, with more mortgage arrears and more people pushed into renting. My hon. Friend the Member for Houghton and Sunderland South mentioned the research carried out by Zoopla, which has reported that rental prices have risen by 5% in the last 12 months, while wages have remained stagnant for many. Average rail fares are rising three times faster than wages, and are 50% higher than they were in 2010. Studies by the Office for National Statistics suggest that those who commute to work are set to experience the steepest increase in rail fares next January. As we heard from my hon. Friend the Member for Reading East (Matt Rodda), it is all coming together in a perfect storm.

There are further problems on the horizon. This week we have seen the crisis in energy costs and soaring prices. Fuel debt is already the third most common type of debt with which people seek help. The energy price cap for October—just as the cold weather sets in, furlough payments end and the universal credit uplift is scrapped—is set at £153, higher than the warm home discount payment, which has been set at the same rate since 2014. As Martin Lewis has said on his website, that payment should be increased in the Budget, and I hope that the Ministers are listening to that too.

The CAB estimates that 2 million households are already behind in paying their energy bills. As I have mentioned the CAB, it is important to note that while demand for debt advice has gone up and up, funding for debt advice services has decreased. If the Government do nothing else as we come into the autumn, they should at least look at properly funding our debt advice services.

The cutting of the universal credit uplift will be the biggest overnight cut to social security, with 8,630 households in Newport East alone seeing their money cut by £20 a week. I know at first hand from my constituents, as many hon. Members do, how the uplift has been a lifeline for those struggling to buy essentials.

[Margaret Ferrier (Rutherglen and Hamilton West) (Ind)]

I have heard from One Parent Families Scotland that single parents are often overlooked and stigmatised, and that an overwhelming number of one-parent families are headed by single mothers. On top of the day-to-day worries of increased energy and food costs, they also worry about providing a happy Christmas or a fun birthday for their children, and will push themselves into debt to do so. The £20 universal credit uplift is a lifeline for single parents. Does the Member agree that it is not enough to be barely getting by, and that it is also about quality of life?

[Jessica Morden]

The hon. Member makes a really valid point. Added to that is the fact that single parents who are under 25 get a lower rate of universal credit because they are perhaps deemed to be living at home, which is deeply unfair. They will also be deeply hit by these cuts and changes.

We know that 40% of those who will be hit by this cut are in work. That is an inconvenient truth for Ministers, who ignore the fact that universal credit is as much an in-work benefit as an out-of-work benefit. A cut of £1,040 a year alongside the increase in national insurance contributions says everything about where this Government’s priorities lie. Action for Children has said that

“you can’t level up the country by pushing down the living standards of some of the hardest working families in the country.”

The Joseph Rowntree Foundation estimates that 300,000 more children will be pushed into poverty. Families who are just about keeping their heads above water will be plunged into poverty.

In the face of this crisis, the Government choose not to help but to make things worse, wasting huge amounts of taxpayers’ money on outsourcing and crony contracts while hitting the same group of people over and over again. I hope that Conservative Members will do better tonight than they have in previous votes. I hope that they will stand up for constituents who need them, and show that they understand what life is like for many in this country.

Brexit: Opportunities

Margaret Ferrier Excerpts

Thursday 16th September 2021 Commons Chamber

[Michael Ellis]

My right hon. Friend makes a very good, apposite point. We will certainly take that back.

[Margaret Ferrier (Rutherglen and Hamilton West) (Ind)]

As the Government look to consult on reform to personal data protection policy, concerns have been raised about the potential removal of article 22, which guarantees that people can seek a human review of an artificial intelligence-made decision, creating cause for concern for data protection campaigners. Will the Paymaster General confirm whether the Government have assessed the impact of this potential removal in relation to negotiating trade deals with other countries?

[Michael Ellis]

Of course, the whole area of AI will open up myriad issues such as the one that the hon. Lady referred to. The Government are alive to those points and will take all those issues into careful consideration.

Oral Answers to Questions

Margaret Ferrier Excerpts

Tuesday 22nd June 2021 Commons Chamber

[John Glen]

I congratulate the hon. Lady on her recent elevation. I take her points on board, but this is a complex area. There will need to be a range of interventions from industry, working with regulators. The LINK scheme already has a £5 million fund to help areas of great deprivation and provide extra access points for cash, but we need to recognise that technology will have to play a significant role. We will also use the extensive network of 11,500 post offices to make good on our pledge to ensure that access to cash remains available across the country.

[Margaret Ferrier (Rutherglen and Hamilton West) (Ind)]

If he will make a statement on his departmental responsibilities.

[The Chancellor of the Exchequer (Rishi Sunak)]

As we have reopened our economy since the last lockdown, we have continued to provide extensive support through our £400 billion plan for jobs, protecting businesses, families and individuals. I am pleased to say that the early data on household incomes, employment, corporate insolvencies and consumer and business confidence all show that our plan for jobs is working.

[Margaret Ferrier [V]]

Following the Treasury’s announcement of compensation to cover up to 80% of the losses of holders of mini-bonds with London Capital & Finance, will the Chancellor now also act to provide full compensation to the victims of another scandal, the collapse of Equitable Life? The vast majority have received just 22% of their losses.

[Rishi Sunak]

I very much appreciate the hon. Lady’s raising the issue. She will know that the matter has been extensively discussed and debated for many years. The matter, after review, has been concluded and closed and is final in all respects.

Future Relationship with the EU

Margaret Ferrier Excerpts

Thursday 10th December 2020 Commons Chamber

[Penny Mordaunt]

We are already out, I would just remind the hon. Lady, but clearly we have prepared for every eventuality. We have a phased approach to the border. We have many pots of work going on into the new year to ensure that there are not those cliff edges that she refers to. We have thought long and hard, and there has been a huge effort by the civil service to ensure that, whatever the outcome, it will be as smooth as possible for our businesses and our citizens. I thank the hon. Lady, who has been consistent in helping us secure a deal, and I urge all Members of this House to follow her example. I think that all Members can, from whichever seat they sit in in this Chamber, help us, and I would ask that everyone does that in the coming days.

[Margaret Ferrier (Rutherglen and Hamilton West) (Ind) [V]]

One of the concessions the Government made this week is on clause 45 of the United Kingdom Internal Market Bill, which would have allowed the UK Government to apply UK state aid rules in Northern Ireland. Given that the UK Government feel comfortable conceding on this clause, will the Minister now also look at deleting clause 50, which reserves the power to Westminster to apply state aid rules in Scotland and Wales?

[Penny Mordaunt]

I refer the hon. Lady to the statement by my right hon. Friend the Chancellor of the Duchy of Lancaster yesterday and just reiterate Northern Ireland’s unique position in the United Kingdom.

Spending Review 2020 and OBR Forecast

Margaret Ferrier Excerpts

Wednesday 25th November 2020 Commons Chamber

[Rishi Sunak]

I know that this is a topic about which my hon. Friend feels passionately, and rightly so. As she will have heard me say, we do this with a heavy heart. It enables us to make progress on our other priorities, and it is indeed temporary. We intend to return to 0.7% when the fiscal circumstances allow.

[Margaret Ferrier (Rutherglen and Hamilton West) (Ind) [V]]

According to the Institute for Fiscal Studies, public sector pay is now at its lowest level in decades relative to that in the private sector. Although the announcement of a pay rise for NHS workers is welcome, other public sector workers will be put in even greater financial insecurity by the pay freeze. Does the Chancellor not feel that, in the context of the great work those people are doing in this pandemic, the public sector pay cap is a dramatic failure to show our appreciation for all their hard work?

[Rishi Sunak]

The hon. Lady mentioned the relative pay premium. It is worth bearing in mind that there still is a pay premium. The latest numbers we have, from 2019, show a 7% pay premium between public and private sector wages. That premium will without doubt have been exacerbated by the growing disparity in public-private sector wages that we are seeing this year. So in the interests of fairness and of protecting public sector jobs, I think it is right that we have taken a targeted approach and prioritised pay rises for those on lower incomes and in the NHS.

Support for Self-employed and Freelance Workers

Margaret Ferrier Excerpts

Thursday 17th September 2020 Commons Chamber

[Margaret Ferrier (Rutherglen and Hamilton West) (SNP)]

Time is of the essence, so I am going to cut to the chase and give a couple of examples from constituents who have been in touch with me because they are ineligible for support because of the timing of when they became self-employed. One email I received was from Steve, a self-employed wedding videographer from Cambuslang, and it sums up the position many newly unemployed constituents have faced with the scheme. He told me:

“I took great comfort in Rishi Sunak’s words that ‘no one will face this alone’. However, because I only became self-employed in December, and despite the huge effect the crisis has had on my business—effectively putting me back to square one—I was unable to receive any SEIS because I hadn’t been self-employed for long enough.” 

Lesley runs a photography business and lives in Rutherglen. She found herself ineligible for support under the scheme because, as a small limited company director, she took her income in the form of dividends. She told me:

“As my husband and I are both full-time directors, we are missing out on over £27,000 of support that we would’ve received had we been considered self-employed and treated equally. That money would’ve been retained in our company to pay for overheads and staff, rather than taken by us personally. It’s criminal that honest taxpayers are paying into a system which is excluding them in a time of crisis. It has gone beyond the issue of dividends, these companies need the same support as the self-employed.”

Lesley’s words not only demonstrate the devastating impact that ineligibility for SEIS will have on businesses; they highlight the mistake of bringing the scheme to an end prematurely. Self-employed people working in industries that are still in recovery from the pandemic, such as theatre, live events and productions, want the scheme to be extended for as long as is needed to protect their livelihoods.

This Government must start listening and act quickly to extend both the availability of grants under SEIS and the eligibility criteria for receiving those grants. Like other Members in the Chamber, I am a member of the APPG focused on the gaps in support. I call on the Minister to listen and to arrange a meeting so that we can discuss ways out of this and give options to the people who have been left behind.