Santander Closures and Local Communities

Paul Scully Excerpts

Thursday 14th February 2019 Westminster Hall

[Paul Scully (Sutton and Cheam) (Con)]

It is a pleasure to serve under your chairmanship, Mr Davies. I add my thanks to the hon. Member for Glasgow East (David Linden) and congratulate him on securing this debate. I am delighted to support him. As my hon. Friend the Member for Angus (Kirstene Hair) said, bank branch closures affect the constituents of hon. Members on both sides of the House. It is important that we stick together to represent people and stand up for the most vulnerable in our society.

In 2016, not long after I was elected, I was faced with a couple of bank closures in my constituency, in Cheam. The high street there thrives on independent shops. First, Lloyds Bank came to the end of its lease. I would give the constituent of the hon. Member for Heywood and Middleton (Liz McInnes) the same counsel that I gave my constituents who were upset about losing Lloyds Bank: vote with their feet and go to HSBC up the road. Unfortunately, just a few months later, HSBC decided to close, too. Constituents can be pulled from pillar to post, continually having to move, to chase the exodus from the high streets. Banks do not want to be the last bank on the high street, because all the focus would be on them when they eventually respond to a changing market.

I retain a good relationship with my local Santander branch in Sutton, which looks after customers of the two that are now closing. I remember a tweet that I sent to a constituent on 19 May 2016, in which I said that I had had a chat to Santander, which was closing quite a small branch in North Cheam, but was committed to its main Cheam branch. Fast-forward only three years: that branch is now closing. The last bank in Cheam will have gone.

When Lloyds Bank and HSBC were closing, residents set up petitions, but petitions only have so much value. Yes, they can show the weight of opinion and ask the banks to please be considerate, but when a banking chain has made a corporate decision, a petition will generate heat but not a lot of light, so we need to look at other ways to respond. Can we encourage customers to move elsewhere? Can we work on the post office network, despite the restrictions on that, which we heard about from other hon. Members? Are we putting an unfair burden on the post office network and the Government in relation to decisions made by corporate organisations?

In the case of the Santander closure in Cheam, three local councillors, Elliot Colburn, Holly Ramsey and Eric Allen, have taken a different tack. Metro Bank is looking at expanding its network in other areas, so they have made a direct approach to Metro Bank, saying, “Here’s a space. There are no banks. It is an area where there are a lot of independent shops. Metro Bank takes a different tack in its approach to attracting customers—it is a bit of a disruptor bank—so why don’t you come in and consider Cheam as an option?”

What more can we do? We have talked about the pressure being put on to post offices. In Sutton, it looks as though our Crown post office will be moved to WHSmith, which will cause angst and concern to a number of people there. On the other hand, not far away in Belmont, a village to the south of my constituency, a post office has just been opened at the back of a pet shop, and it is one of the best-used post offices. It won an award from the network as one of the best new post offices in London, coming second only to one on Oxford Street. That is pretty impressive. If it is put in an imaginative place, it will be used.

What more can we do? Should we look at the banking hubs and a return to the ’70s, or some form of technology to move banks from making corporate decisions to making marketing decisions, which can go a totally different way? If the bank takes a marketing decision to look at innovation, its corporate social responsibility will move the decision away from just being a box-ticking exercise for its shareholder report to being something that can actually add value to the high street and tackle the issues such as loneliness mentioned by my hon. Friend the Member for Angus. By making the high street a hub and a community centre and bringing in other businesses to work with the bank, the bank can become the centre of the high street, which has to be good for that bank.

[Albert Owen (Ynys Môn) (Lab)]

The hon. Gentleman makes an interesting point about hubs, as have other hon. Members. What role does he think the Government should play in that? We have heard about the closure of Crown post offices, which the Government own, but surely hubs could be there, because they are well located and owned by us. We are the taxpayers and our constituents need those services.

--- Later in debate ---

[Paul Scully]

The hon. Gentleman makes an interesting point. We have talked about how moving Crown post offices into WHSmith branches across the country will limit their structure, because they have some big buildings at the moment. The massive floor space of the one in Sutton is well used, so I am not sure how it will cope if it is restricted at the back of somewhere. It might be a regressive move. There is a limit to how much the Government can direct the Post Office and banks, but they must have a significant influence. They should treat the issue holistically as they look at the future of the high street in general.

We have talked about the access to banking standard. At least Santander now has to go through the process of mitigating the results and looking at who the most vulnerable people are—I hope it would want to do that anyway. The people using bank branches these days tend to be older people, who do not necessarily have access to technology or are not as good at using technology as others, and retailers, especially the independent retailers that I was talking about that are still cash-heavy and need to bank their cash.

For the two branches that are closing in my constituency, the alternatives to Cheam are 1.3 miles and 3.3 miles away, and the alternatives to Worcester Park are 1.8 miles and 3 miles away. For a small business that wants to pay cash in at the end of the day, if there is no post office near enough, that is some distance to go with what might be quite a lot of cash, which is not very secure.

[Matt Rodda (Reading East) (Lab)]

I support the hon. Gentleman’s point about the distance for small businesses. We have that issue in my constituency with the post office closure, which relates to the bank closures. There is a village a mile away from Reading town centre, a separate entity, where three banks and a post office have closed. That is a considerable amount of travelling time for a small business trying to bank cash. We have lost other banks in locations near Reading University and we have lost further facilities in other areas too.

The hon. Gentleman makes a good point about the need to look holistically at the whole parade of shops, the needs of vulnerable local people, particularly the elderly, and the needs of local small businesses. I urge him to raise with his hon. Friends in Government the possibility of an area-based approach, whereby those different needs are taken into account as part of banking or post office regulation.

[Paul Scully]

In Reading, as in Sutton, the difference in mileage is relatively small, but congestion and extra traffic mean that it represents significant travel time. We cannot compete with the 15 miles that people have to travel in the constituency of my hon. Friend the Member for Angus.

I will make a final point and then let other hon. Members speak. When banks decide to close, we have to make sure that there is still access to a cashpoint network, so people who rely on cash—although that is dying down a bit—have access to it. When I was a local councillor in the neighbouring constituency of Carshalton, I spoke to a baker who had been badly affected when Barclays and its cashpoint closed there. That village relied on its independent shops, but after the cashpoint closed, people tended to turn left, towards the larger supermarkets, rather than right, where the smaller independent shops are. Previously, people had walked past the independent shops to get their cash and would spend money in the bakers and the other smaller shops on their way to do their main shop. Branch closures have a detrimental effect and we need to look at the issue holistically to make sure that we have a thriving, albeit changing, high street.