Community Bank Closures

Peter Aldous Excerpts

Thursday 8th February 2018 Commons Chamber

[Peter Aldous (Waveney) (Con)]

I congratulate the hon. Member for Stoke-on-Trent North (Ruth Smeeth) and my hon. Friend the Member for Hazel Grove (Mr Wragg) on securing the debate.

This matter is of specific interest to me. Early in December, Lloyds bank announced the closure of three branches in the Waveney Valley area of north Suffolk: in Bungay, in my constituency, and in Halesworth and Southwold in the constituency of my hon. Friend the Member for Suffolk Coastal (Dr Coffey). I should declare an interest at this point, because I am both a personal and a business customer of the Halesworth branch. Shortly after the Lloyds announcement, NatWest announced the closure of its branch in Beccles, which is also in my constituency.

My main concern is that, if Lloyds proceeds with the closure of its Bungay branch, there will be no bank left in the town, and I believe that we need policies to prevent that from happening. Some may say that I am a luddite and that we cannot hold back the inevitable march of the internet and modernisation, but what concerns me is that some banks are closing branches in an indiscriminate, non-strategic way that will have an adverse impact on the elderly, the disabled, those without their own transport, small businesses, and the economies of the towns and hinterlands that will be left with no bank standing. In the last two years, Barclays and Norwich and Peterborough building society have closed their branches in Bungay. If Lloyds proceeds with its branch closure in May, there will be no bank left in the town. That has upset many people who transferred their accounts to Lloyds following the previous closures, and it will have a particularly negative impact on the elderly and disabled and on small businesses.

I have three specific concerns. First, if Lloyds proceeds with its closure, there will be no cashpoint machine with 24/7 access in the town centre. Bungay has three street fairs a year, which bring a significant amount of business into the town. Last Christmas an estimated 1,200 to 1,500 people came along, and there were long queues at the Lloyds cashpoint. Many of the traders who go to the street fairs only handle cash, and there is a real worry that, if it is not available locally, the fairs—which add so much to the vibrancy of the town—will suffer.

Secondly, it is important to emphasise that many businesses, both in the towns and in the countryside, still use cash and cheques. The lack of immediate access to cash and deposit points will, at least in the short term, cause considerable inconvenience and added expense. On the basis of my experience as a partner in a local family farm, I know that for several farmers the easiest way to handle payments from the grain merchant is still via cheques, and that quite often the rents paid by small businesses for farm buildings and workshops are still paid in cash. It should also be borne in mind that the change to internet banking in rural areas will require considerable improvement in broadband connectivity, an issue about which we have heard throughout the debate.

Thirdly, the lack of a bank in Bungay will affect the town’s ability to draw in customers from the surrounding area. Lloyds is redirecting its customers to its Beccles branch. That may mean that people who came into Bungay once a week to go to the bank, to do their shopping and to have a coffee or a meal may now do all that in Beccles. I met Lloyds representatives on 4 December, when I put those points to them. I asked them to reconsider their decision to close the Bungay branch. It is disappointing that I have not yet had a response from them, although I hope that that means they are giving the matter serious consideration.

With regard to NatWest’s closure in Beccles, I had a meeting with the bank’s representatives last month. I am disappointed with their decision, but they took me in some detail through why they reached the decision to close the branch and how they are now engaging with their customers. They are prepared to work with the local community. As well as a mobile bank and closer working with the post office, they have plans for a community banker who will have a base in the town at set days during the week, possibly in the library and the town hall.

I have mentioned that the closure of Lloyds in Bungay would result in there being no ATM accessible 24/7. With this in mind it is necessary to ensure that there remains a good network of cashpoints across rural Britain, where consumers and small businesses use cash to a greater extent than in urban areas. I thus urge the Government to support the Which? and Federation of Small Businesses campaign to get the Payment Systems Regulator to ensure suitable measures are in place to guarantee that consumers can easily access their money without charge.

It is important that measures are introduced that can help to avoid a situation where towns are left without a single bank. That could be done in a variety of ways, in particular by building on the post office network, which generally has a better rural reach than that of high street banks. The policies put in place, first by the coalition Government and then the current Government, have been successful in making the post office network more resilient.

In Bungay, the post office is in the newsagent and there is a drawback of lack of space. In towns at risk of having no bank, consideration should be given to providing additional funding to put in place a more substantial post office branch. Ultimately, I would look for this to be funded by the banks. Alternative options that could be considered are mutual societies or pop-up banks, where the high street banks join together to sustain a presence in the town.

Bungay was a pioneer of provincial banking, with Gurney’s, a precursor of Barclays, opening one of its first branches in the town in 1808. Some 210 years on, it will be a very sad day if the town no longer has its own bank and we must do all we can to ensure that that does not happen.