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Banking in North Ayrshire

Volume 637: debated on Wednesday 14 March 2018

Motion made, and Question proposed, That this House do now adjourn.—(Mike Freer.)

I am delighted to have secured this debate on banking in North Ayrshire, although I really wish it was not necessary. I should apologise in advance for my croaky voice as I struggle through this speech. I have been trying to secure this debate since November, when the closures of RBS branches in Kilwinning, Kilbirnie and Saltcoats were first announced. I have the fortune, or misfortune, to have secured this debate on the very week when I have lost my voice—make of that what you will.

Since November, I have spoken in three debates on bank closures, written several letters to Ross McEwan, the chief executive of RBS, and raised this matter with the Chair of the Scottish Affairs Committee, which has summoned the chief executive of RBS. I have also held street stalls with SNP local councillors, activists and volunteers on countless Saturdays in the affected towns since Christmas, collecting signatures for a parliamentary petition protesting against these closures, which I will be presenting in this place in the coming weeks.

The reason for all this activity is the real anger and betrayal felt by the people of Kilwinning, Saltcoats and Kilbirnie at the loss of these banks in their towns. RBS is a bank that they own via the Government—a bank bailed out from its own mistakes and mismanagenent by their taxes.  Now this same bank is leaving these communities without a backward glance or any sense of social responsibility towards the very communities on whose taxes the bank’s very continued existence relied.

Although many communities in Scotland will be left without a bank following the latest announcement of closures, in my own constituency what has happened brings the total number of towns with no bank to a staggering six.  The towns of Dalry, Stevenston, West Kilbride, Ardrossan and Beith no longer have a bank; should the latest round of closures go ahead, we can add Kilwinning to that list. Kilwinning will be a town of over 16,000 people with no banking facilities—it would be funny if it were not so appalling and ridiculous. I honestly do not think any other constituency in the UK has been so adversely, cruelly hit. Indeed, the banks are stampeding out of Ayrshire at an alarming—a staggering—rate.

I salute my hon. Friend’s courage in getting through the debate. Does she agree that rural areas are particularly badly hit by bank closures? I am thinking of those in North East Fife, where RBS closed all but one, leaving a huge commute for those who need banking services the most.

I do. I will come later to the fact that no cognisance has been shown of the consequences for communities that the banks are supposed to serve.

I congratulate the hon. Lady on her timely debate about the whole issue of banks, which affects not only Ayrshire but the whole country. There is a trend for banks to make closures, particularly in countryside areas. People are left to their own devices, with no way of getting money, their giro cheques or other services. This is a national issue. This is the thank you that the public get for bailing the banks out in the first place.

The hon. Gentleman has put his finger on the real source of the anger: people’s sense of abandonment and being left to their own devices with no other facilities on which to rely, despite the fact that the bank exists because the taxpayer made sure that it did.

I congratulate the hon. Lady on securing the debate and thank her for giving us a chance to participate in a small way. Given that banking is increasingly moving online, it is hard for urban and rural communities that are geographically isolated from physical banks if they are also limited by the provision of broadband services. Does the hon. Lady feel that that issue should be clearly considered before any proposed bank closures take place?

Indeed. I thank the hon. Gentleman for his comments, which go to the heart of the issue of financial inclusion, social exclusion and digital exclusion. These things have to be worked out together in some kind of organised fashion.

At one point in its history, RBS championed vowing not to close the last bank in town, but now it is twisting itself into all sorts of shapes to dissociate itself from that promise. I suppose the PR men for RBS found the appeal of that vow attractive, but now it seems that RBS is embarrassed by it and is no longer holding to it. We have heard a little tonight about banking online. We hear about this a lot, and I accept, as we all do, that many people now choose to bank online. There is no dispute about that. If it suits the lifestyle and needs of those who choose to bank online, good luck to them, but many do not bank online, for a variety of reasons. As the hon. Gentleman said, many choose not to do so because they are digitally excluded; this is a choice that they are not able to make.

The hon. Lady raised a very interesting point, because there is an issue with broadband, particularly in the countryside. A lot of people have problems with BT and broadband, and that denies people the opportunity to go online, if they so wish.

The hon. Gentleman is absolutely right about that. The banks talk about online banking as though it is a choice, but for many people it is not a choice, as they are digitally excluded. Many people may not be digitally excluded but may simply decide that online banking is not for them, for whatever reason. For the record, I put myself in that category, as I choose not to bank online. The point is that it should be up to the customer to choose how and when they bank, and it is not up to the banks to make that decision for us. But what we have now is a situation where the banks have decided, most cynically, that those of us who have chosen not to bank online must be herded into that particular pen, despite our will.

I congratulate and commend my hon. Friend on securing the debate and on the way she is strongly presenting her argument. Will she comment on the strength of feeling in North Ayrshire about the footfall figures that have been released—or have not been released—by RBS on the branches there? There is certainly a feeling in Airdrie, where RBS is trying to close one of my local branches, that it has not provided sufficient or accurate information on the justification for those closures, which is very concerning.

My hon. Friend is absolutely correct about that. We all know, as we have all seen in our own constituencies, the jiggery-pokery that has taken place in the presentation of these figures, which do not reveal—[Interruption.] I am hoping that this is the first time “jiggery-pokery” will appear in Hansard.

I have heard the term used previously by the hon. Member for North East Somerset (Mr Rees-Mogg).

Thank you for that clarification, Mr Speaker. We do know that there has been jiggery-pokery and all sorts of nefarious goings on as to how these figures are presented. [Hon. Members: “Sleekit.”] My colleagues are shouting the word “sleekit” to me, which may well indeed cover the particular practice that is going on. The point is that it is not right for customers to be herded into the pen of online banking, a place where they have up to this point chosen not to go or have been unable to go. We are being forced down this road by banks as they shut up shop. If we insist that we do not want to bank online, the attitude we see from too many banks, including in conversations I have had with banking officials, who shall remain nameless, is that they collectively shrug their shoulders and more or less say, “Suit yourselves, but we are still shutting your bank.”

I thank the hon. Lady on several counts. I thank her for securing the debate, for the good work that she and her fellow councillors have done in her constituency to hold RBS to account and for using the word “jookery-pawkrie” —the “jiggery-pokery” that I can understand.

I am left-handed and I am from a different party as well. Will the hon. Lady join me in expressing dismay that none of the 10 banks that was given that reprieve was from Ayrshire? Indeed, the 10-month reprieve is simply a stay of execution and it is derisory for the people of Scotland. RBS could do better for the people, who have been customers for generations. It was a world leader and it has let down the people who made it.

The hon. Gentleman is right that giving 10 banks a reprieve is not enough, and I am of course disappointed that none of them is in Ayrshire. I wish the banks that have been reprieved well, but I wish that we could add to that list the other 52 in Scotland that are earmarked for closure. If we could give a reprieve to the banks in my constituency, I am sure that we would make every effort thereafter to persuade RBS that the reprieve should be permanent. Obviously, the goal would be to save every bank, but I shall come back to that later because the Minister is looking at me with a bit of alarm.

I would throw one question out there in respect of digital exclusion. The banks are fond of telling us that we do not need to have branches and that we can bank online. I would particularly like to know what RBS’s advice would be to digitally excluded customers. Where do they go when the last RBS in their town closes? How do they access banking services?

My hon. Friend is making an excellent speech. RBS likes to talk about the mobile vans that are going around, one of which comes into the rural part of my constituency of Dundee West. They often stay for a very short period; they have steps to get in, so those who are infirm or disabled cannot get in; and when it is raining people often have to stand waiting for half an hour to get service, so get soaked to the skin. Does my hon. Friend agree that the people who are digitally excluded are the very people who come for that essential service?

My hon. Friend is absolutely correct. RBS has informed me that in my constituency, North Ayrshire and Arran, it will replace the branches in Kilwinning, Saltcoats and Kilbirnie with mobile banks. That is completely unsatisfactory. The mobile banks are delayed by the weather and by traffic and they are not disability compliant. Apparently, the advice is that if someone is disabled, immobile or has a mobility impairment and cannot access the mobile bank, the banking teller will come out and they can do their banking in the middle of the street. Well, that’s okay, then! It is absolutely shocking.

My hon. Friend is making an extremely passionate speech. The all-party group on disability, which I chair, is going to launch an inquiry into community banking for people with disabilities and mobility problems. My constituents who have mobility problems and live in Strathaven and Lesmahagow, where RBS plans to close the banks, feel particularly let down. They feel that no appropriate services will be available.

Indeed; I shall come in a little while to the importance of providing accessible and sustainable banking services in all our communities and for the needs of all our communities, including for those of us who cannot get to the next town because of lack of our own transport or of public transport, or because of other mobility issues.

My hon. Friend has spoken about the impact of bank closures in rural areas, but does she agree that they also have a real impact on small businesses on the high street in outlying village areas of a cities, such as Juniper Green in my constituency, where the Royal Bank of Scotland shut its branch last year? If the auto-teller is taken away, people will drive to the supermarket to get their cash out and spend their money there, rather than in the many vibrant small businesses that exist in places such as Juniper Green in Edinburgh.

My hon. and learned Friend leads me smoothly to my next point, although of course we are not just concerned about rural areas—Kilwinning could hardly be called a rural area, by any stretch of the imagination. Her point about the effect on small businesses is extremely important, because we all know that small businesses, which are the backbone of our communities—the lifeblood of our communities, keeping the heart of our high streets beating—work in an extremely challenging retail climate. If local businesses cannot bank their takings at the end of the business day, they incur additional insurance costs. They can either take their cash home with them at the end of the business day—because if the bank goes, there is no night safe—or they drive to the next town to bank their takings. Either way, their insurance costs go up. With businesses already struggling on the edge of survival, that could well be enough to tip several of them over the edge. For that reason, the support of banks in our towns often proves critical for small businesses. Let us not forget that, regardless of their political views, everyone in this Chamber understands the importance of small businesses to keeping our high streets alive.

I welcome this Adjournment debate because three banks are shutting down in my constituency in Chryston, Bellshill and Tannochside. Tannochside has one local bank, built by the community. When those banks opened, it was local workers who built them, and the hon. Lady is spot on about local businesses. The staff of small businesses usually have to take large sums of money, and if the alternative is to go to the post office, post offices are not equipped to take them. This is a very good subject for debate and I thank the hon. Lady for introducing it.

I thank the hon. Gentleman for that intervention. I now need to make some progress, because I know that the Minister is keen to respond.

As for those living in the towns affected by the closures, Kilbirnie customers have been advised that the nearest RBS following the closure of their branch is in Largs, a round trip of 18.8 miles; Saltcoats customers have been directed to Irvine, a round trip of 12.8 miles; and Kilwinning customers have also been directed to Irvine, a round trip of 6.8 miles.  That is simply not good enough when one considers that many of those customers do not have access to private transport.  They will be at the mercy of local public transport in all weathers. So the elderly and infirm will be left to fend for themselves as financial and social exclusion—that is what we are talking about—bites in their towns.  The bank closures will mean that the affected communities no longer have access to day-to-day essential banking services. We have heard about the problems of mobile banks. They are not a solution to the problem of the closure of the last bank in town. They are a poor substitute and the people of Kilwinning, Saltcoats and Kilbirnie expect and deserve better.

Banks have shown, and are showing increasingly, that they have no sense of service to our communities. Tonight, I call on the Minister to establish and enforce a guaranteed minimum level of service provision for essential banking services, recognising the importance of continued access to banking for our communities.  Surely, it is now time, given that banks are riding roughshod over our communities with no sense of service or responsibility, for a guaranteed minimum level of service provision for essential banking services to be put in place.

I know that the Prime Minister has said repeatedly that branch closures are operational matters for the banks, but that is not good enough. RBS is still almost 73% owned by the taxpayer, so this is a bitter pill to swallow.  In addition, the UK Government retain all legislative and regulatory powers in respect of financial services, so the UK Government have the authority to call a halt to this devastating round of closures while banks, stakeholders and the UK and Scottish Governments consider how best to take account of the obligation to banking customers and our communities.  Whatever the banks may say, they have an obligation to our communities—a service obligation, a financial obligation and a moral obligation.

The UK Government argue that these are “operational decisions” for banks, but there is a precedent, as the Minister knows, and George Osborne, the former Chancellor, let the cat out of the bag. He confirmed that during his time as Chancellor his consent was sought by RBS about the departure of the former chief executive officer, Stephen Hester.  The UK Government could right now reject any RBS branch closures unless and until impact assessments have been carried out, and should require RBS to ensure that practical and sustainable alternative banking services are put in place before any closures are signed off.

It really is time to call on RBS management to reverse these planned closures.  The Minister tonight has a responsibility to demonstrate that the UK Government are standing up for our communities on this most important issue. The SNP Westminster leader, my right hon. Friend the Member for Ross, Skye and Lochaber (Ian Blackford), has persuaded RBS to reprieve 10 branches across Scotland until impact assessments have been carried out.  I wish those communities well, but it does nothing to soften the hammer blow for the towns in my constituency that face losing their banks and for Kilwinning in particular which will lose its last bank branch.  In the past, the Minister has suggested that customers who are not happy can move their accounts to another bank.  What does he suggest that the people of Kilwinning do, when there is no bank for them to move to within a reasonable distance?

Of course customers are also advised to move their accounts to the post office.  Well, 10 years ago I recall collecting petition signatures to save post offices in my constituency when swathes of them were being closed down in my constituency under a previous Government. Post offices bolted on to the back of the local Spar simply do not provide the range of services or privacy that customers need and deserve.

I appeal in good faith to the Minister to ensure that these closures are halted—that RBS is ordered to halt these closures and carry out full impact assessments on the communities affected. All the communities affected want nothing less, and the people in the towns of Kilwinning, Kilbirnie and Saltcoats deserve nothing less.  Is the Minister going to stand with RBS management, or is he going to stand with the communities affected and the communities of Kilwinning, Kilbirnie and Saltcoats in particular?  I urge him to do the right thing and stand up for our communities.

I sincerely commend the hon. Member for North Ayrshire and Arran (Patricia Gibson) for securing this debate. She has once again spoken very powerfully on behalf of her constituents, and I know that she is passionate about this issue. The RBS executives will note that there are more than 20 Members of Parliament here and that a number have spoken. They will also want to reflect on the views that have been expressed.

Since becoming Economic Secretary on 9 January, I have had the privilege of responding to a number of debates on the closures of bank branches across the UK and in specific local areas. In each, I have heard important stories about what the local bank branch can mean to the community, as I have heard again this evening. It means a great deal in terms of practical access to services. I will return to that point in more detail. Banks can also be at the heart of how people feel about their local high street and the future of their community. Putting my Treasury responsibilities aside, I visited a bank in my constituency that is facing closure in exactly the same way that the hon. Lady set out. I had to sit down with the bank manager and go through the same sorts of arguments, but these are commercial decisions. I will say a little bit more about that.

No, I am not going to give way because I have only eight and a half minutes, and I want to do justice to all the points that have been raised.

This Government are very aware of the issues. I will talk about the challenges facing the banking sector and our communities. I think that the hon. Lady has said in a previous debate that she does not bank online, and that is her choice, but whatever our personal preferences, banking is going through a period of unprecedented technological change and consumer behaviour is changing significantly. Banks are having to adapt to those shifting patterns of behaviour. The decisions that they are making are sometimes not popular and I understand why, but the hon. Lady will be well aware that those decisions are not for the Government.

The hon. Lady made a point about the former Chancellor, the former Member for Tatton, signing off on the chief executive post. There is a big difference between signing off on strategic leadership and getting involved in day-to-day commercial decisions.

I am not going to give way; I am just going to continue.

Each bank’s branch strategy, including whether to open or close individual branches, is for the management of that bank to determine. I understand that that is frustrating. It is frustrating to all of us who face this issue. The Government rightly do not intervene in these commercial decisions, nor do the Government manage the RBS Group. RBS is headed by its own board, which is responsible for strategic direction and management decisions. All businesses strive to deliver for their customers, but they also need to be able to plan for the future and to make changes where they are needed. These are complex commercial decisions. RBS has made its decisions in line with its commercial strategy.

No, I will not.

The hon. Lady and her colleagues are entitled to ask questions, as they have done very effectively this evening, and to press RBS on its rationale. Although I do not agree that the Government should or could cancel RBS’s decisions, I am certain that the hon. Lady’s views, expressed here again this evening on behalf of her constituents, will have been heard by RBS.

I turn to the Government’s role with respect to the Post Office. The hon. Lady has previously said that the Government have “not lifted a finger” to help. I beg to differ. The Government are taking action, and I welcome the opportunity to reiterate that. For those who still need or want to bank in person, we have helped to expand and improve face-to-face banking services at the Post Office. There are 11,600 post office branches in the UK, 24 of them in the hon. Lady’s constituency. There is a post office in each of the three towns that she mentioned—Kilwinning, Kilbirnie, and Saltcoats. Indeed, across the UK, 99% of personal customers and 95% of business customers can do their day-to-day banking at the post office.

In response to the hon. and learned Member for Edinburgh South West (Joanna Cherry), who was concerned about—

I am going to response to the points raised. I have five minutes.

On the concern about small businesses and cash lodgements, RBS offers cash courier services, while the post office can accept up to £2,000 without prior notice, and further arrangements can be made on a case-by-case basis. As the hon. Member for North Ayrshire and Arran has mentioned previously, this might not be a service that people are yet fully familiar with, but I believe that it offers a valuable alternative and that people are adjusting to the reality of what can be obtained from a post office. It is important that the people who can benefit from these services know about them, so I will keep pushing the banks and the Post Office to do more to raise awareness of the expanded services that they jointly offer. It is important that they make this case proactively and publicly. We should spread the message far and wide. We can all do our day-to-day banking at the post office. We in this House can help to reassure people who may be worried about this issue.

On the oversight of banks, where they do decide to close branches, the Government’s ongoing support for the industry’s access to banking standard is making a real difference. All the major high street banks have signed up to the standard, which commits banks to a number of outcomes when a branch closes: first, that they will give at least three months’ notice—I think that RBS, certainly in some cases, has given six months’ notice—secondly, that they will consider what services can still be provided locally and communicate clearly with customers about alternative ways to bank; and thirdly, that they will ensure that there is support available for customers who need extra help to bank online or to access services at the local post office.

The standard is not just a list of outcomes—it has teeth, because the Lending Standards Board monitors and enforces it. It is actively monitoring how RBS Group and other banks fulfil their obligations to their customers when branches close. It has a range of tools and sanctions at its disposal should a bank fall short. I know that it is very open to talking to Members on behalf of their communities, and I encourage the hon. Lady—


I encourage the hon. Lady—and her colleagues—to talk to the board if she has concerns about the steps that RBS is taking, or not taking, in her constituency. The access to banking standard is the practical way to shape a bank’s approach to local areas. I encourage all Members in all parts of the House to ensure that their community is aware and able to engage with the bank directly.

Several Members have mentioned access to cash. The Government continue to work with industry to ensure the provision of widespread free access to cash. In December, LINK, the organisation that runs the ATM network in the UK, committed to protecting all free-to-use ATMs that are 1 km or more away from the next or nearest free-to-use ATM. This is a welcome strengthening of its financial inclusion programme, and one that I hope will reassure members across the House.

The hon. Lady fights hard for her constituents in North Ayrshire, as do a number of other Members who have spoken, and I am sure that their concerns have been heard. We all understand the frustration and disappointment caused by bank closures, but these are not Government decisions. The Government’s policy remains clear: RBS is responsible for these decisions, and RBS must defend them.


Banking is changing rapidly—we cannot deny that reality—but the Government believe that banks must support communities across the UK when their local branches close. That is a dialogue that we are all deeply engaged with in trying to find the best solution for communities. In this place, we can help to draw attention to these issues and work constructively to help our constituents to access the services they need. For my part, I will keep pushing for everyone to be able to access the banking services they need, wherever they live.

Question put and agreed to.

House adjourned.