Monday 16 April 2018
NatWest bank closures
The petition of residents of Penistone and Stocksbridge,
Declares that the proposed closure by the NatWest Bank of its local branches in the town of Penistone and Stocksbridge should be reconsidered by the bank; further that the closure of these branches will leave both towns without bank services; further that the bank claims electronic banking will still allow customers to access services; further that the petitioners believe for many customers that this will not be possible and further that petitioners maintain that the closure of these branches could have a detrimental effect on many small business in the area.
The petitioners therefore request that the House of Commons urges the Government to recommend that the NatWest bank reconsiders the closure of these two branches.
And the petitioners remain, etc.—[Presented by Angela Smith , Official Report, Tuesday 6 February 2018; Vol.635, c.1463.]
Petitions in the same terms, objecting to the closure of bank branches were presented by the hon. Member for Southampton, Itchen, (Royston Smith) [P002110]; the hon. Member for Linlithgow and East Falkirk (Martyn Day) [P002111]; the hon. Member for Glasgow East (David Linden) [P002118]; the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry) [P002125], [P002131]; the hon. Member for Perth and North Perthshire (Pete Wishart) [P002121]; the hon. Member for Argyll and Bute (Brendan O’Hara) [P002126], [P002129]; the hon. Member for Paisley and Renfrewshire North (Gavin Newlands) [P002127], [P002130] and the rt. hon. Member for Ross, Skye and Lochaber (Ian Blackford) [P002128].
Observations from the Economic Secretary to the Treasury (John Glen):
The Government thank all Members of Parliament who have recently submitted petitions on bank branch closures on behalf of their constituents.
The Government are sorry to hear about residents’ disappointment at the closure of their local bank branches.
All banking service providers will need to balance customer interests, market competition, and other commercial factors when considering their strategies. Decisions on opening and closing branches and agencies are taken by the management team of each bank on a commercial basis, without intervention from Government.
Where closures are being carried out by RBS group, the Government are clear that their stake in RBS Group is managed at arm’s length by UK Financial Investments (UKFI). UKFI are wholly owned by the Government and are responsible for managing the Government’s stake in the assets acquired during the financial crisis. UKFI are not responsible, however, for managing the assets themselves. RBS retains its own board, which is responsible for strategic and management decisions and decisions relating to branch closures are solely within the remit of the bank.
However, the Government do believe that banks should act in the best interests of their customers and is committed to increasing competition to deliver better financial products and services for all bank customers. The Government continue to engage actively with the banking industry and consumer groups on these issues on an ongoing basis.
In May 2017, the major high street banks signed up to the Access to Banking Standard, committing to work with customers and communities to minimise the impact of branch closures and put in place alternative banking services. The Standard commits banks to ensure customers are well informed about branch closures, the bank’s reasons for closure and options for continued access to banking services. These options should include specialist assistance for customers who need more help. The operation of the Standard is monitored and enforced by the independent Lending Standards Board, ensuring that banks are held accountable for the way they treat their customers when a branch closes.
In addition, in January 2017, the Post Office announced that it had reached an agreement with the banks that will allow more banking customers to access a wider range of services at the Post Office than ever before. The new arrangement allows individual and small business customers to withdraw money, deposit cash and cheques and check balances at more than 11,600 Post Office branches in the UK. While the range of services offered by the Post Office may be more limited than that offered in a traditional bank branch, the services provided through the Post Office’s extensive network ensures that essential banking facilities remain available in as many communities as possible. The Post Office estimates that 99% of personal and 95% of business customers will be able to carry out their day to day banking at a Post Office as a result of the new agreement.
Both initiatives have the Government’s full support, and banks are aware that the Government expect their involvement to be genuine and unqualified.
Should constituents decide to switch banks, the Government have made it easier to do so than ever before using the Current Account Switch Service (CASS). The switch service is free to use, comes with a guarantee to protect customers from financial loss if something goes wrong, and redirects any payments mistakenly sent to the old account, providing further assurance for customers. This means that customers are more able than ever to hold their banks to account by voting with their feet, and that banks are incentivised to work hard to retain their existing customers and attract new ones. More information about CASS is available at: www.currentaccountswitch.co.uk.
The Government cannot reverse the changes in the market and in customer behaviour; nor can it determine firms’ commercial strategies in response to those changes. However, the Government will continue to take positive action to maintain access to vital banking services and ensure banks support communities across the UK when their local branches close.