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Banks: Vulnerable Customers

Volume 767: debated on Monday 21 December 2015

Question for Short Debate

Asked by

To ask Her Majesty’s Government whether they have any plans to ensure that retail banks treat their vulnerable customers fairly.

My Lords, the story begins with a letter, out of the blue, to a 93 year-old woman, just two days out of hospital, from her bank, giving her, after 60 years with it, “formal notice” that her account,

“will be closed and our contact with you ended”—

allegedly a decision “not taken lightly” though, in fact, it was made after no attempt to contact her, no problem with the account and no reason for any such action, all of which the bank later admitted. Furthermore, the unsigned, computer-generated letter went on to say that, once the account was closed,

“no further standing order will be paid”,

and,

“any cheques presented ... will be rejected with the response ‘account closed’”,

and—the story does not end there—

“should we receive any request for a status report about you … we will reply that we are unable to express an opinion. Lastly, we will not be prepared to offer you any new banking services”.

So an active account, held over a lifetime, was to be closed, and the customer rendered unbankable.

A flurry of exchanges followed, sadly demonstrating a lack of truthfulness by the bank which said that it did not know of any vulnerability about her or her husband. The latter was in a home with Alzheimer’s, the fees were paid through the same account, and the bank held a power of attorney for him and was aware of the lady’s age. All of this the bank later admitted, including that no contact had been made prior to the letter. The bank rectified this case with a bouquet of flowers and with compensation of £750 being given to Alzheimer’s and stroke charities. I fear that it was the intervention of a Member of your Lordships’ House that may have made the difference.

But this is not an isolated story. We have read of Daniel Head with Barclays, the Langleys with HSBC and Barclays again with power of attorney problems, and I have heard of many other examples around this House and elsewhere—so my follow-up is about the wider issue, not this specific case, though the bank remained unhelpful, refusing to say how many such letters were sent, why they went direct from a computer with no personal signature and no senior sign-off despite the gravity of the letter, or whether this happens for an active account held for 60 years.

We have a systemic problem which breaches the legal duty of care under which banks must ensure that they put the interests of their customers first. Indeed, with the support of the Financial Services Consumer Panel, we on this side of the House tabled amendments to require the FCA to make rules on the duty of care which the Government rejected. Will the Minister now revisit this decision?

The Consumer Panel has also identified problems over forced bank account closures and wants banks to be more transparent about them. It is claimed that they are about suspicions of money laundering, but they have dire consequences for customers, leaving them with no current account and no ability to open an account elsewhere as they are effectively blacklisted.

The Financial Conduct Authority’s recent paper on vulnerable consumers rightly says:

“Vulnerability can come in a range of guises, and can be temporary, sporadic or permanent in nature”.

However, many banks use a very narrow definition of “vulnerable”. For example, the BBA focuses mainly on mental health, a tiny part of the picture. Vulnerable customers are not a fixed group. Life events like job loss, bereavement, divorce and illness can render any of us temporarily vulnerable. My own view is that while vulnerable consumers are those especially susceptible to detriment, such detriment actually arises, as the FCA admits,

“when a firm is not acting with appropriate levels of care”.

As the FCA wrote:

“Most problems relate to poor interactions ... systems that don’t flex to meet needs … failure of internal systems … where firms fail to communicate … internally … plus … over-zealous implementation of rules”.

So systems are the problem, not the client.

The FCA says:

“Fair treatment of all customers is central to core conduct”—

and this is the lesson I want to draw. Banks must sort out the problems. It should not be for consumers to tell a bank that they are vulnerable. Banks should be treating all customers fairly. Some banks and regulators seem to think that all we need is “full competition”, in the words of the TSB, for,

“consumers … to see a change in an industry that’s been stacked against them for far too long”.

But I do not accept that customers should have to wait for that competition before they get a fair deal.

Contrary to the CMA’s view, customers should not have to switch banks in order to drive up standards. Regrettably, despite evidence of poor customer care, the CMA fell back on the hoary old “competition” let-out: if only there were competition and consumers switched, banks would have to improve. That will not do. Banking is virtually an essential service and customers should not have to put up with poor service, let alone be threatened with the forced closure of accounts.

The Financial Conduct Authority must act to clean up banks’ poor service. If it does not, the Government must tell them to. This is for all clients, not just the vulnerable. Indeed, in the case with which I started, although my aunt—for it was she—is in her 90s, she has every marble and more and is not in debt. However, she had just had a stroke, and did not need her blood pressure raised by finding her bank account closed and being rendered unbankable, possibly even without even access to her funds that the bank held. So for her, and for others, I ask the Government whether they have any plans to ensure that retail banks treat their vulnerable customers—indeed, all their customers—fairly.

My Lords, I am grateful for the opportunity to hear from the noble Baroness, Lady Hayter, about the experience that she has described. It is certainly the case that banks need to look at how their systems work regarding vulnerable customers. I was hoping today to raise the wider issue of financial exclusion in the UK, which has been of concern for some time.

The Parliamentary Commission on Banking Standards estimated that 3 million people are financially excluded—that is, excluded from or unable to engage with the financial services necessary to play a full part in modern life, to manage money to absorb financial shocks, and to plan and provide for the future. Information from the Community Investment Coalition states that 9 million people are overindebted; 13 million people do not have enough savings to support them for a month if they experience a 25% cut in income; and 56% of the poorest households do not have home contents insurance. Citizens advice bureaux in England and Wales dealt with 4,907 new debt problems every day during the quarter ending September 2015.

Access to basic banking facilities is an essential part of modern life, as employers and government agencies move away from cash and cheques towards electronic payments. Small and micro businesses are also affected by difficulties in accessing basic affordable financial tools. This impacts on their sustainability and opportunities for growth. Effective tools for savings, payments and accessing credit and insurance can help people to climb out of poverty or get through a crisis or emergency without falling into debt. It can help businesses to survive and grow and not slide into bankruptcy should a crisis occur.

While there is a rapid move to mobile banking, many older people, cash-based businesses and people in poorer communities are still dependent on access to bank branches to manage their money, yet there was a net loss of nearly 7,500 bank and building society branches between 1989 and 2012—more than 40% of all branches.

The coalition Government undertook a series of measures to tackle specific barriers to financial inclusion, including a £38 million investment in the credit union advancement project, while the previous Government provided £74 million for credit unions and community development finance institutions to lend to deprived and excluded communities. Finance education was put on the national curriculum for secondary schools in England, and the regulation of high-cost short-term credit and auto-enrolment for workplace pensions were introduced. Local authorities and housing associations are trialling ways of supporting financial capability and tackling indebtedness.

However, more needs to be done to address financial exclusion. Every adult, household and business should have access to a basic package of fair and affordable finance tools to actively participate in the economy through employment or entrepreneurialism. These should include a basic transactional bank account; a savings scheme; access to credit; physical access to banking facilities; insurance; and independent money management advice. Clear action from government must include an examination of community finance provision across the UK to identify where communities have the potential to be well served by existing providers and where there are gaps, and an evaluation of existing affordable finance tools—what the take-up is in poorer communities, whether available products are meeting demand and how these products can be offered more widely.

The Government should give regulators clear direction on the value and importance of the community finance sector and the need to regulate to encourage stability and growth. There should be a scaling-up of the community finance sector to increase investment and access to capital with the creation of a banking licence tailored to this sector. This would include permitting co-operatives to hold banking licences and investing in suppliers of central services to all local community finance providers, such as access to payments, infrastructure and regulatory compliance.

Although progress has been made in reducing financial exclusion, radical change in such areas as digital technology, finance systems, benefits and pensions means that a strong lead must be taken by government if the poorest and most vulnerable in society are to be protected from financial disadvantage and the disastrous outcomes that may result. I very much hope that the Minister will consider these proposals and perhaps be able to describe what the Government are doing to reduce financial exclusion and enable everybody to participate in the modern world without the disasters that we know have befallen many vulnerable citizens.

My Lords, I congratulate the noble Baroness, Lady Hayter, on securing this important debate. For clarity, perhaps I should point out that although my name is Cashman, I am not a banker.

I have been concerned for some time, as someone who lives in a part of London that is both extremely rich and extremely poor, about the disparity in access to banking services—namely, ATMs. Often when people cannot get to bank ATMs, they have to pay an additional charge when they use them in places such as newsagents. Branch access is another big issue, and the need for clear and jargon-free accounts and information from front-line staff who are properly trained. Equally, as one who has known the concept of vulnerability both personally and within my family, I recognise, as my noble friend Lady Hayter pointed out, that there is a wide definition of “the vulnerable”. Indeed, even those who would be described as vulnerable do not see themselves as being in that category.

However, lots of excellent work has been done. Once again, I congratulate and commend the House of Lords Library service and the documentation it has produced on this issue, which highlights the need for much more to be done—if necessary, with the force of legislation.

I welcome the moves by the European Commission, following its consultation and recommendation, for a directive that would create a right—I repeat, a right—for European citizens to open a payment account with basic features, irrespective of their financial circumstances. The directive specifies minimum standards that include: transactional services, direct debit, a payment card, ATM access and the absence of any overdraft. This directive must be supported by all member states.

The banking industry generally has spent more than £300 million, which is to be welcomed and recognised. However, retail banks are not matching minimum standards and many are on a race to the bottom as they seek to freeze out those who require the most basic account in order to function in the modern world, and indeed to gain access to internet services and the competitive processes and prices on the internet, such as low-priced energy deals or telecom deals when paying by direct debit or standing orders.

Banks that have shown real commitment—it is worth mentioning them—are: Barclays, which still remains the only retail bank that will open accounts for undischarged bankrupts; the Co-operative Bank; and Lloyds. The latter two also carry the largest number of basic accounts and thereby the biggest burden, which should be shared more equitably. The Nationwide Building Society has a good record in this area, too, as does Metro Bank, which prides itself on accessibility and welcoming new business.

Here I will address a related issue, of start-up charities and the appalling hurdles and almost insurmountable obstacles that are placed in their way when trying to open an account for a newly established charity, foundation or trust. My own experience is that building societies and virtually all high street banks do not want to open new accounts for charities. The one and only bank that facilitated the process and welcomed this new business was Metro Bank, which complied with all aspects of law and due diligence and showed how it can be done. It is shameful and shocking that other high street banks have turned their backs on such business. I can only surmise that it is because this is an area of work that causes them to work.

To return to the main issue, the vulnerable in our society are being let down by the majority of banks, which will have a tremendous negative impact on the poorest and most needy in our society, especially when we see universal credit rolled out and increasing reliance on payments into and out of banks. People are undoubtedly going to suffer unless something is done. In the Library document there is an appalling catalogue of poor services, poor information, sharp selling, phone lines which cost the user an additional fee by the minute—0845 numbers, and others—continued interdepartmental referrals where people already under stress have to repeat the issue and their circumstances again and again. There is a catalogue of pre-tailored responses to people who are trying in all good will and faith to notify their banks of potential financial problems due to ill-health, bereavement, redundancy, and so on. The catalogue of complaints which have been upheld by the Financial Ombudsman does not make pleasant reading.

Quite frankly, it is shocking that people in need of basic services, let alone basic understanding and compassion, are left sadly and badly wanting, and often with nowhere or no one to turn to. Yet I must recognize the tremendous work undertaken—often with much reduced resources—by Citizens Advice, the Money Advice Trust, National Debtline and many other charitable organisations. So, too, the work by the FCA, the Financial Ombudsman, the Financial Inclusion Commission, and the work of your Lordships’ House and the other place in the report of the Parliamentary Commission on Banking Standards. In particular, I will refer to the recommendations of the commission, most notably paragraphs 290 and 291, which can be summarised:

“The Commission believes that banking the unbanked should be a customer service priority for the banking sector. It should be a right for customers to open a basic bank account irrespective of their financial circumstances. The Commission expects the major banks to come to a voluntary arrangement which sets minimum standards for the provision of basic bank accounts. The failure of the most recent industry talks and the apparent unwillingness of some banks to engage constructively in coming to an agreement is a cause for concern … In the event that the industry is unable to reach a satisfactory voluntary agreement on minimum standards of basic bank account provision within the next year, the Commission recommends that the Government introduce, in consultation with the industry, a statutory duty to open an account that will deliver a comprehensive service to the unbanked, subject only to exceptions set out in law”.

I note that the British Bankers’ Association vulnerability task force, under the chairmanship of Joanna Elson, will report in March 2016. Notwithstanding that, I look forward to the Minister’s reply and in particular to hearing not what we should or must do but what we are going to do, and when, to address this major problem which disadvantages so many people from so many different backgrounds and perspectives and which, as I know only too well, could affect any one of us.

My Lords, my comments will follow those of my noble friend who has just sat down and of my noble friend Lady Hayter. I have been concerned for some time about the poor standard of service to many people from the banks. I want to say first of all that I know that improvements are in the pipeline; my noble friend has just referred to some of them, and I am aware of the Practitioners’ Pack that has been issued by the Financial Conduct Authority—all of which are welcome steps. I have also seen one or two improvements on banking websites just recently.

I will focus my remarks on one area which is a growing problem. It is the issue of power of attorney for vulnerable people. I speak partly from my own experience of having to manage the finances of a relative for whom I have power of attorney. The experience is not a good one and is very difficult to deal with. A very important point here links into what some of the things the Financial Conduct Authority needs to look at as well, which is the relationship between the banks and some of the other financial institutions which persuade people to part with their money, often by direct debit and other means, to pay for services of one type or another.

I will start simply with the example which brought it to my attention—that of my own relative. When I discussed it with other Age Concern-type groups they told me that this was fairly common. When I took power of attorney I started looking into what banks, including the bank I was dealing with for my relative, had an easily searchable site for power of attorney. Generally, it was bad news. Barclays has just improved very considerably, and now, if you type “power of attorney” into the search engine you get a number of options. When I typed it into the NatWest website I got no answer, and no answer from the frequently answered questions either. When I typed it into HSBC, which I have never rated very highly for any of these services, the site just told me what power of attorney was—a power that is given to someone else—but did not tell me what to do about it or how to use it, or anything like that.

The worst experience was with Barclaycard. Unfortunately, I had taken the card myself, but it took me about two months to close it down. First of all I went to Barclays Bank, as most people would do, only to be told, “Barclays Bank is different from Barclaycard”. I rang Barclaycard and had a couple of phone conversations, during one of which I was told to go to Barclays Bank. I therefore went back and told the people there, and again they said, “No, we can’t do it here”, and I said, “Well, I was told on the phone that you can”. The response was, “No, we can’t”. I made a major effort to close down the card. I got through to a very helpful person on the phone and eventually the situation was sorted out. But the fact that there is nothing on the website about power of attorney is bad. When you search through the terms on a bank’s website, you should be able to type in “power of attorney” and get the information you need.

On the Barclaycard website, I found my way to a part of the site which said, “We help vulnerable people”. There was a picture of an elderly lady called Alice whom the company was helping, but there was absolutely nothing about power of attorney for her; it just said, “We will help Alice if you phone this number”. It said that it could not give any details about a particular person but that, if you told the company who it was, it would look into it. It is so ill thought through that it is almost impossible to imagine anything worse.

People’s experiences of dealing with banks vary immensely. My experience with Barclaycard was particularly bad but others which I have talked to have been quite good. It depends very much on whom you get to speak to. But the evidence that I have picked up generally both from my own experience and from talking to other people is that, by and large, many of the staff do not know what to do at first and often have to refer the matter to someone else. With the increase in the incidence of dementia and related conditions, power of attorney is now so common that we ought to see it as a primary factor.

Similarly, companies should provide an address to write to. I am pretty familiar with the internet and computers—I can use them—but we should bear in mind the people who cannot. What would someone of my age who may not be familiar with the internet and computers have done in the situation that I have described? They would have gone to the bank but I am not sure how that would have worked out, and in many cases there is no address to write to.

The other thing that I was particularly struck by—I want to draw this to the attention not only of the Minister but of the Financial Conduct Authority—was the linkage between banks and financial organisations. On my relative’s account there was a regular payment for a freezer. It was obviously an insurance payment, although it did not say so sufficiently clearly on the bank details for me to find out what it was for. Eventually I found out that the payment was for insurance on a freezer and it had been going on for at least five years as far as I could make out, although I am still waiting to hear the details. I stopped the direct debit as there was no point in making the payment—I had moved my relative out and was selling the house.

However, about two months later I looked at my relative’s account again and found that the direct debit had restarted. When I visited the house, which at that time was empty as I waited to sell it, I came across an unopened letter. It said:

“Your … Fridge Freezer Protection Plan is due to expire on”,

14 July,

“but there’s no need to worry—we’ll renew it automatically”.

I wrote to the company, Domestic & General, and got a reply in which it apologised, saying that it regarded that seriously and did not think that it should have happened. In fairness, I must give it more time to deal with the matter, but it said that it does not think that a direct debit should be restarted without direct permission. I do not think that it should either. The problem is that I really do not know whether the fault lies with the insurance company or with the bank. What I do know, with great clarity, is that if I stop a direct debit and the bank agrees to stop it, I do not expect it to start again without my permission. I suspect that this has happened in other cases. People have said to me, “Oh yes, they can restart it automatically”. I suspect that this is partly down to a payment being restarted at the end of a term, but in the middle of a term it is not justified.

I have come across a number of situations of this type. Another one concerned the broadcaster Sky. My relative was paying £80 a month for the full service, and this was someone who had never watched sport in her life. She had the full package and the payments went on, although eventually I managed to stop them. Therefore, there is a very real problem here for vulnerable people and for the person who has power of attorney. I can find my way through the problem but an awful lot of people will not.

Finally, banks have to get a lot better at dealing with things such as direct debits. The one that I bank with mostly is the Co-operative Bank and it is often very hard to work out the name of the organisations that my direct debits are going to. They often have coded names, which is fine if you can remember what they are. In my case, I have about 30 direct debits. I sometimes wonder what they are for and have to look them up. Every direct debit should be listed with the name of the organisation that it is going to, and it should be a proper name and not one that leads you off down the highways and byways of the internet. It must be recognisable.

So there is a gap here between banks and financial institutions generally and other organisations that take money off people through regular direct debits without any real clarity. I am very pleased that a Practitioners’ Pack is now available from the Financial Conduct Authority, and I am very pleased that there are other changes in the pipeline. It is obviously starting out on a journey but it has a very long way to go, because the standard of service is very poor. I could also talk about the charity issue to which my noble friend Lord Cashman referred. I started a not-for-profit company but HSBC seemed more interested in getting it closed down than in helping me to manage in a difficult area.

But my key point is about vulnerable people. That is what the debate is about and I welcome it. The power of attorney issue is becoming increasingly important. If I were to make a simple plea to every financial institution and insurance company, it would be, “Make sure that you have ‘power of attorney’ in your search engine so that people can link into it. Then start thinking about what you do for the older person who is not familiar with using computers”. If an older person has power of attorney for a wife or a husband, for example, how on earth do they manage? It is not like the old days when you popped down the road to see your bank manager. There should be one person in every bank to whom you are referred if you have problems of that type.

My Lords, I thank all noble Lords who have spoken today and I especially thank the noble Baroness, Lady Hayter, for securing the debate and giving me this opportunity to explain how the Government try to ensure that retail banks treat their vulnerable customers fairly.

I have to say that I agree with nearly everything that all noble Lords have said. I, too, have had personal experience of these issues, including the power of attorney issue—my mother died last year of Alzheimer’s, so there were other issues that I will not bore noble Lords with. Interestingly, my father was a director of Barclays Bank for 20 years and worked for them all his life—some time ago, I hasten to add, before the latest troubles occurred. In those days, there was a greatly different approach to individual customers. That is something that banks need to think about. They certainly knew their customers a lot better than they do now. Incidentally, my father was a director of both Barclays and Barclaycard.

The Government are determined that banks, and the wider financial services sector, should work for everyone, at every stage of their lives. We want to improve access to financial services for all—I will come back to the remarks made on that by the noble Baroness, Lady Janke—including the elderly, the vulnerable and rural communities.

The UK does have in place a strong regulatory framework to protect customers. In 2012, the Financial Conduct Authority was set up to regulate the conduct of all financial services firms. The FCA requires banks and building societies to provide a prompt, efficient and fair service to all their customers, and that includes the vulnerable. The FCA is, of course, accountable to Parliament, and its annual report sets out progress on its operational objectives. The handbook requires firms to identify particularly vulnerable customers and to deal with such customers appropriately. The first of its three operational objectives is to secure an appropriate degree of protection for customers.

The FCA also engages actively with the industry to ensure that firms consider the needs of their vulnerable customers. As many noble Lords have mentioned, earlier this year the FCA published an occasional paper on Consumer Vulnerability and a Practitioners’ Pack to help industry create and implement appropriate strategies to address the needs of vulnerable customers. This work captured findings from a number of third sector organisations. What was shocking to me in that report was the sheer scale of consumer vulnerability in the UK, particularly in literacy and numeracy. However, it also highlighted the success of partnerships between retail banks and charities such as the Alzheimer’s Society. These partnerships have helped banks and building societies, and in particular front-line staff, to better understand the needs of customers. The clear message from the FCA research is that we can all become vulnerable.

Many commentators, including the Financial Services Consumer Panel, of which the noble Baroness was a distinguished vice-chairman, think that firms can still do more. Since the FCA research was published, the British Bankers’ Association has set up the financial services vulnerability task force, in September. This will look at how institutions can improve the experience of customers who may be in vulnerable circumstances. The FCA is involved in this work, alongside a number of charities and financial services trade groups.

The objectives of the task force are to identify good practice and the gaps where policy, systems, products and implementation could be improved, and to make recommendations within six months to see that best practice is adopted across the industry. In particular, it will consider opportunities for retail banks to deliver more consistency in key processes, such as firms’ requirements of consumers in bereavement notifications, access to power of attorney accounts, which the noble Lord, Lord Soley, referred to, and identification requirements. I can tell the noble Lord, Lord Soley, that the power of attorney issue will be covered by the BBA task force. It is clear that this is something that members of the industry have started to recognise and are looking to address.

The aim should be that vulnerable customers are treated fairly from the outset. If that is not the case, it is of course possible for the customer to complain to their bank. Again, the FCA’s rules require the banks to properly investigate all complaints, and it monitors complaint-handling processes. If the customer is unhappy with the way the bank has handled their complaint, the Financial Ombudsman Service may be able to investigate. It provides a free, independent dispute resolution service for bank customers, and would consider the emotional or practical impact on a customer and not just financial loss.

The Government are also working hard to ensure that all customers can access the banking services that they need, which the noble Baroness, Lady Janke, and the noble Lord, Lord Cashman, referred to. The regulation of the consumer credit market has been fundamentally reformed by transferring responsibility for consumer credit regulation, including the payday market, from the Office of Fair Trading to the FCA, which has much stronger powers. The Government have legislated to require the FCA to introduce a cap on the cost of payday loans to protect consumers from unfair costs.

The noble Baroness, Lady Janke, mentioned also financial literacy, which has been introduced into the secondary school national curriculum.

The Government also recognise the difficulties customers may have in accessing a bank account, which relates to the points made by the noble Baroness, Lady Janke, about exclusion. To address this, the Government have reached a landmark agreement on basic bank accounts. It makes clear the groups of customers who should be offered a basic bank account, including those who have no bank account, have a bank account elsewhere but want to change provider, or have a bank account but are in financial difficulty and want their bank to open a new, functional account for them.

Until now, basic bank account customers have risked incurring charges for failed payments, meaning financially vulnerable customers could be pushed into serious debt. From the end of this year, basic bank accounts offered by the nine major current account providers in the UK will be truly fee free, including for failed payments. In September 2016, the Payment Accounts Regulations—to which the noble Lord, Lord Cashman, referred—will come into force, and I had the pleasure of taking them through this House with the full support of the opposition parties. That will create a firm legislative framework for continued access to basic bank accounts in the future.

The noble Baroness, Lady Hayter, asked about the Competition and Markets Authority. Its provisional findings were published at the end of October and they still need to be consulted on. The CMA will issue a final report next spring but the Government stand ready to take action as appropriate once we have the CMA’s final recommendations.

The noble Baroness also referred to bank account closures. The supervisors in the FCA may well use account closure as an example to explore how a bank treats its customers. If they receive specific intelligence on an issue at a specific firm, they may consider whether it is appropriate to pursue the issue. As I have said, individual cases should be pushed through the official complaints process.

The noble Baroness, Lady Janke, referred to credit unions as part of her remarks on exclusion in financial services. We have encouraged the growth of the credit union sector, but I will not go into the detail of that.

The noble Baroness also asked what the Government are doing to ensure that the vulnerable, the elderly and the rural communities have access to banking services. We are committed to improving access for those groups. Banks and building societies are required by the FCA to provide a prompt, efficient and fair service to all their customers. Very importantly, each of the major banks offers some level of service through the Post Office network, which the majority of the banks’ customers can use in 11,500 branches across the UK.

I mentioned financial literacy at school, but financial literacy and numeracy among adults in this country is also quite shocking. The coalition Government established the Money Advice Service to enhance consumers’ understanding and knowledge of financial matters. Recently, we launched Pension Wise, which offers free and impartial guidance to those aged 50 or over on their retirement options.

On basic bank accounts, I mentioned the payment accounts directive and the agreement that we had reached. These negotiations to improve basic bank accounts have been aimed at preventing practices such as limited access to ATMs and the charging of significant fees.

The noble Lord, Lord Soley, referred to the power of attorney. It is an issue which will be covered by the BBA task force. That is a very important aspect that it needs to cover. On auto-renewal, the FCA has launched a consultation, which was published on 3 December. I feel that there has been a sea change in the sense that the FCA has been very clear in what it has written and what it expects from companies. The BBA task force, which covers all financial services, has a wide group involved in it, including charities, and will report in six months. As I have said, the Government stand ready to come in but we will see what it comes up with in a relatively short space of time.

In conclusion, I assure all noble Lords who have spoken that the Government are committed to ensuring that retail banks treat all their customers fairly. This includes vulnerable customers. I hope the Government’s actions that I have outlined today provide noble Lords with some reassurance on this point.

Sitting suspended.