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Automated Teller Machines

Volume 485: debated on Thursday 18 December 2008

Following the March 2005 Treasury Committee report on ATM (Automatic Teller Machine) charging, the Treasury invited the Chairman of the Treasury Select Committee, the right hon. John McFall, to chair a working group on ATMs to take forward work on key issues. The working group, which included banks, independent ATM operators and consumer groups, published its report on 13 December 2006.

The Government are pleased to report that the industry has, over the 24 months following publication of the ATM Working Group’s report, made excellent progress towards its goal of placing around 600 non-charging machines across 1,707 low-income areas within the UK, which were identified as lacking convenient access. Around 2 million individuals on low incomes should stand to benefit. Since the publication of the working group report, LINK has assessed that around 10 per cent. of the identified low-income areas are unsuitable for an ATM location, as there is no centre of population.

As of 21 November 2008, sites for 560 of the 600 new ATMs required have been identified. Of these, 527 new free machines are already in use and issuing cash to the public. In March 2007, a market-based financial incentive—known as a “financial inclusion premium”—was introduced, to encourage ATM operators to place or retain free ATMs in deprived areas with a low expected volume of transactions. Some 67 per cent. of these ATMs that are based in the target deprived areas receive the “financial inclusion premium”. Encouragingly, 26 of these new cash machines have proved so popular that their level of withdrawals means that they have now graduated from the “financial inclusion premium” scheme, 17 more since July 2008 statement.

Banks, building societies and independent ATM operators have all contributed new free-to-use cash machines; independent ATM operators have provided or are in the process of supplying around 34 per cent. of the confirmed new non-charging ATMs. The UK ATM network, LINK, is continuing to work with its member banks and ATM operators to identify suitable sites in the remaining target areas, and is engaging closely in this exercise with Members of Parliament, local authorities, consumer councils and retailers.

The benefits in terms of financial inclusion are clear. Data from LINK suggest that the new ATMs currently in operation or under contract will enable over 1.4 million residents in the target low-income areas to access cash more conveniently and manage their money more effectively.

The working group further agreed to implement improved transparency rules for charging cash machines. Operators of cash machines that charge users for withdrawals and that can upload screens remotely, have met by the end of June 2007, deadline to improve the on-screen standards of “at a glance” signage. This means that it is clear to a consumer when a charge is applied when withdrawing cash. Good progress was also made by operators in enhancing external signage by the end of December 2007.

The ATM Working Group report of December 2006 further recommended developing a joined up policy approach to planning permissions. On 24 November 2008, the final report of the Government commissioned independent Killian Pretty review on ‘Planning applications: A faster and more responsive process’ was published. The review put forward proposals to deliver a planning system that would be more customer focused, fair, proportionate and transparent. The Government have signalled that they supports the broad thrust of the report. In the new year, the Department for Communities and Local Government intends to publish a fuller response to the recommendations, together with an implementation plan.

One of the recommendations in the report included revising and expanding the existing simpler consenting system for certain types of development—known as prior approvals. Research published alongside the Killian Pretty report proposed that the prior approval process might include ATMs.

A review of information requirements for the validation of planning applications was also published alongside the Killian Pretty report. This review included consideration of design and access statements, which accompany planning applications, including those for externally located ATMs. The review recommended that existing guidance on design and access statements should be updated, in particular to provide advice on how crime should be addressed.

The Government are encouraged by the substantial progress achieved, and would like to take this opportunity to thank all of those involved in extending free access to cash to those who need it the most.

Full details about progress made are available on the LINK Internet website: http://www.link.co.uk/atm/access_to_cash. Proposals for additional ATM sites can also continue to be made to LINK.