Local Bank Closures

[Joan Ryan in the Chair]

I beg to move,

That this House has considered the Government response when the closure of the last local bank is proposed.

It is a pleasure to serve under your chairmanship, Ms Ryan. I am delighted to have secured this debate, because the closure of our local bank branches in Moray has been an issue of significant concern for some time. I want to start with a roll call. Since 2015, we have seen 16 bank closures in the following towns in Moray: Cullen, Dufftown, two in Aberlour, three in Keith, two in Buckie, Elgin, a further two in Lossiemouth, two in Forres, Burghead and Fochabers. Those bank closures have affected communities in the north, east, south and west of Moray—no part of our area has been unaffected. The issue continues, with growing frustration for my constituents in Moray and constituents across Scotland and the UK.

In the UK, bank branches have reduced from 11,365 in 2007 to just 7,207 10 years later. In Scotland, between 2010 and 2018, a significant number of branches closed. RBS reduced its branch network by 70%, Clydesdale bank by 53% and Santander by 42%. Which? estimates that there are 130 communities in Scotland alone that are described as cash deserts. That means they do not have access to either a local bank branch or an ATM.

The banks have their reasons for doing this. They explain that footfall is decreasing, that more people are taking up online banking and that people can use different methods to deal with their banking needs. I disagree with that for a number of reasons, but an email I received from a constituent summed it up perfectly. The constituent comes from Portknockie, and wrote:

“I support you in calling banks to account. We know that bank closures in Moray have been severe and that banks have not even followed their own protocols when closing branches.”

She continued:

“I use online banking and am fortunate to have both the skills and fast broadband which make this possible, but I think that it is wrong that banks are acting on the assumption that everyone has these and increasingly that they have smartphones and good mobile signals. I have a smartphone but the mobile signal where I live in Portknockie is so poor that SSE were unable to install a smart meter.”

Yes, the banks do have many reasons for suggesting that these closures are the right way forward, but I believe that this constituent and many more who contacted me ahead of this debate are absolutely right. People are not unaffected by these closures. A large number of people in our communities either do not have access to fast broadband, to allow mobile banking, or simply do not want to use it, but wish to continue the face-to-face contact that they value with their banks.

I congratulate my hon. Friend on securing this debate. His constituent also raised the question of the procedures and processes that banks go through before they disengage with a community. In the experience of my constituents and my own experience in Bridge of Allan, that is a tick-box exercise and nothing more.

I endorse and agree with my hon. Friend’s comments. I want to focus specifically on how banks approach this whole process. It could be done far better—indeed, it could not be any worse.

My hon. Friend is making an excellent case for why it is wrong that these banks have been closed. In my own area in the Scottish Borders, we have lost many bank branches, which causes great anxiety to many of the residents. When banks shut a branch, they say that there are mobile or other banking options, but many communities do not have access to mobile phone signals or broadband. Does my hon. Friend agree that the banks should be doing more, before they shut the branch, to ensure that all residents and communities are properly connected? The Government may have a role in supporting that, too.

My hon. Friend’s seat in the Scottish Borders, my own in Moray and many others across Scotland do not have adequate broadband provision to allow a suitable online connection, to which the banks are directing so many people. I will be interested to hear the Minister’s response to the point made by my hon. Friend.

It is right that we should discuss bank closures in the round, but this debate specifically addresses the point at which the final bank branch in a town closes. Sadly, we have recently seen that in Lossiemouth. Lossiemouth is not a small town; it is a growing town. The population is increasing, largely due to the UK Government’s investment there. We are putting £400 million extra in RAF Lossiemouth, which will be the home of the P-8 Poseidon aircraft. With that, there will be at least an additional 400 personnel and their families coming to the town.

It is all the more bizarre and upsetting that now, when Lossiemouth has this huge investment and is preparing for an increase in population, the last branch in the town should have decided to go—it closed last week. This weekend was the first without the branch and, as I will mention later, the ATM was also removed. In the first weekend after the branch closed and the ATM was removed, a town with almost 8,000 residents was left with no cash whatever. The two remaining cash machines in Lossiemouth ran out of money.

I am sure that all of us here now have experience of towns with no banks in them. If a town known to be highly dependent on the cash economy, as many of our tourism towns are—this particularly affects bars and pubs—loses its last bank, people will be aware that cash is being kept on premises. To what extent have the Government considered the security of the towns and the threat of organised crime? Bars and pubs in particular—on bank holiday weekends, say—will no longer be able to deposit cash locally, so that cash will be held on the premises, which are not equipped and not necessarily insured to hold that level of cash. This is an aspect that we have not considered so far.

I am grateful to the right hon. Lady, because that issue came up when I held a public meeting in Lossiemouth, following the announcement that the final branch in the town would close. The local football club, Lossiemouth F. C., said that it had checked with its insurers, who said that they would either increase the premium to a level that it could not afford or simply not insure it at all, because it would now not be able to deposit cash at the end of the night: the cash would have to remain on the premises. I hope the Minister addresses that issue, but we also have to put it to the insurers, because it is no fault of the football club or other operators in these towns that the banks are now closed and people cannot deposit money.

I want to return to Lossiemouth, a huge town in Moray, being left without cash this weekend. Denise Bedson of the Lossiemouth Business Association told The Press & Journal:

“The situation at the weekend was disgraceful. A lot of small businesses can’t afford card facilities. I know there are cheaper solutions but the phone signal isn’t always the best here for them to work properly. We’re trying to get more banking facilities here because the situation is very difficult”.

It was so difficult that there were reports of people going into the local store to buy one tin of baked beans just to get cash back. They had to buy something that they did not want or need, simply to get money from the store, because the cash machines were not working. Councillor James Allan, my colleague, who represents Heldon and Laich, has been a great local champion for this cause for years. We have gone from four banks and seven ATMs down to just two ATMs. In a community the size of Lossiemouth, that is simply unacceptable. This is just the first weekend. We have serious concerns that this will go on further.

Mention was made of tourism and tourist businesses. Lossiemouth is a great attraction for tourists, with whom it is very popular. We have takeaways and taxi firms, which do not accept credit cards or debit payments. They will suffer as a result of this. Lossiemouth Community Council and its councillors Mike Mulholland and Carolle Ralph have been highlighting the bank closures for some time; they also held a public meeting about them, following my meeting. The issue has been of considerable concern since the announcement was made last November. We knew that this was coming, but the banks have deserted Lossiemouth and other communities across Moray, Scotland and the UK. I believe that they have to do more about it.

While I am speaking about Lossiemouth, the area in Moray that is most affected because it has no branch left, I also want to mention post offices. They play a vital role, but there are some limitations. I know how hard Tony Rook, owner of the post office in Lossiemouth, and his staff are trying—as he commented in The Northern Scot this week, they are doing their level best—but when there is a spike in use and they are away for the weekend, there is nothing that they can do to put more money into their cash machine. He has one of the two cash machines in Lossiemouth. It costs his business to have it facing outwards to the street, but he does it as a public service. It is a great service, but even with great efforts from him and his staff, we were still left without money in a Moray town at the weekend. That is something that we need to look at.

The hon. Gentleman is making a most persuasive speech. When a local authority in Scotland wants to close a school, there has to be a proper public consultation process. Does he agree that something similar would be appropriate for proposed closures of bank branches?

The hon. Gentleman makes a valuable point with which I wholly agree. Like him, I have been involved with school closures as a local councillor, and they are not easy decisions to take. When we were proposing to close Cabrach Primary School in Moray, we had to have a full consultation, even though it had no pupils left at all—the final two, a brother and sister, had moved to another school. There has to be a full consultation with the community to close a school with no pupils, but a bank branch with so many customers that is so valuable to the local area can be closed when the bank comes in and ignores every view put to it.

My most abiding memory of Lloyds’s reaction to what it was doing in Lossiemouth and Keith was that it was not even willing to engage. I wrote to it when I quickly assembled the public meetings, which were attended by people from community councils, the post office and business associations. The meetings in Lossiemouth and Keith both had an empty chair for the bank; because it could not even be bothered to turn up and face the public about its decision, I thought it only right to show the public that it was absent by leaving a chair empty.

People wanted to challenge the figures about reducing footfall or the number of transactions. There were several people in the community who did not believe the figures that were put forward. The bank should have either substantiated its claims and stood up to support them, or gone back to the community and said, “This is where we were correct, and this is where you were correct.” That it was unwilling to do that demonstrates its whole attitude to this crisis.

The bank’s next response is, “Well, we’ll put in mobile banking.” A town the size of Lossiemouth, which has gone from four branches to none, now has a mobile bank coming for an hour or two a week. We have a great climate in Lossiemouth, but it is not always sunny and beautiful; it is sometimes cold and wet, and yet we expect elderly bank customers to stand outside and wait while others go in and carry out their business. There are also elements of privacy that a mobile banking service cannot replace. It is wrong that we should keep hearing, “We are closing your branch, but we will continue to have a presence.” That presence is pitiful, and it does not match the needs and aspirations of the community that uses it.

As I have mentioned before in Westminster Hall, in a debate about access to cash, RBS in Moray has a mobile branch van called the Moray Rambler. There have been so many closures of bank branches across the north-east of Scotland that the Moray Rambler now has to ramble into Banffshire and Aberdeenshire to cover areas outwith my constituency. Not only have we a poor service, but it is being stretched further and further and towns are getting less and less time with the mobile bank.

The key thing is that post offices have to be financially viable. If they are to take on more services, they have to be able to make a living from them. That is a fundamental challenge to the existence of many sub-post offices.

I agree wholeheartedly. That is an issue for the Government, but not for the Minister; I know that the Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Rochester and Strood (Kelly Tolhurst), has been discussing it. I want our post offices to be rewarded for doing the tasks that the banks are currently doing, because they are not being rewarded at the same level as banks for the jobs that they do.

My final point about closures goes back to the figures on footfall. In Lossiemouth, we have been told, “Your nearest branch is in Elgin, which is not too far away.” It is not far away in mileage, but getting there can be quite difficult because our bus services are not as good as they once were. People are expected to get the bus from Lossiemouth into Elgin, but ironically the branch there is not as accessible: people cannot park very easily on the high street, so they have to pay to use a car park and then troop round to the bank. Customers of the same bank used to go from Elgin to Lossiemouth because it was easier to park outside, and now we have closed the branch that they actually wanted to go to. Again, that shows how ill thought-out these plans are.

I know that many hon. Members want to speak in this debate, but I will just highlight access to cash. I have already mentioned the scenario in Lossiemouth where there was no cash available over the weekend. There has been a decline in the use of cash, but research undertaken in 2018 showed that 73% of people used cash frequently—that means once or twice a week.

The next figure that I will cite is interesting: 60% of 18 to 24-year-olds use cash frequently—again, that is once or twice a week. I am looking around me in Westminster Hall; before my hon. Friend the Member for Angus (Kirstene Hair) came in, I thought I was the youngest Member here, but she has beaten me to it. My hon. Friend the Member for East Renfrewshire (Paul Masterton) may have a complaint to make about that. Generally, we think that younger people—those in their thirties, or younger—are more likely to use smartphones, other technology or contactless payment, but we are told that 60% of 18 to 24-year-olds still use cash. Access to cash is not just something that affects the older population; it affects everyone in our communities. Industry figures predict that in a decade’s time, cash will still be the second most popular payment method.

A further concern that was mentioned today in a press release from Which? is that 7 million people were unable to use a payment card last year because of IT glitches. We can encourage people to use different payment methods and move away from cash, but people will still be affected if there are IT glitches, and such problems sometimes cost them money. We need to bear in mind that in the last year, 7 million people were affected by IT glitches.

The hon. Gentleman is making an important point. Access to cash machines is also important for people who are on a budget. They like to withdraw small amounts without being charged, to help them to budget, whereas better-off people may make one large withdrawal for the week.

The hon. Lady is absolutely right. Research into the issue shows that some of the lowest paid in our society will be most affected if there is an even greater reduction in access to cash.

My hon. Friend makes an excellent point about the importance of cash. There is a wider economic point, because many of the small towns that he represents, and many of those that I represent in the borders, are absolutely dependent on cash. In Coldstream, Hawick and other towns in my constituency, when the banks have shut and the cash machines have gone, many traders have noticed a significant decrease in footfall and sales. That undermines the economic viability of the high street.

I totally agree with my hon. Friend. As he mentioned Coldstream and Hawick, I am sure he will get two press releases out of that intervention—something he always does well in debates such as this. Our high streets are vital to our communities, but we have seen a reduction in the number of shops on them. If that continues, we will really suffer.

I will briefly mention banking hubs. They are an idea that we have to consider, and I want to hear what the Minister has to say about them. The idea is not a new one; I know that it was suggested as far back as 2002. Last year, I wrote to every bank operating in Scotland about the suggestion of looking further at banking hubs—I know it has been made by several politicians from different parties—and I have to say that the response was disappointing. Some of the banks ignored the suggestion, and others said that hubs were not right for them. Nationwide said that it did not believe it was in the interests of its members to enter into a branch-sharing scheme. Such a scheme might not be in the interests of Nationwide’s members, but it might be in the interests of our constituents and its customers.

We have to do far more to get the banks to work together. They may have some concerns, but if we cannot have the four branches that we used to have in Lossiemouth, let us at least have one hub where the banks can work together to ensure there is still a banking presence.

I thank my hon. Friend for giving way and for bringing this important issue to the House. We have seen the starting up of a pilot business hub in Birmingham, whereby four bank branches have come together to help businesses. Does my hon. Friend agree that that shows that there is a mechanism for banks to do this, and that they just need the will to ensure that they help their personal banking customers just as much as their business ones?

My hon. Friend makes the point that hubs have been created before and there should be no blockage. However, the banks seem unable or unwilling to move forward on the issue, and perhaps the Minister can use either a carrot or a stick to encourage them to do a little more.

I will end by putting some points to the Minister and asking him some questions, and then I will allow others to contribute to this debate. I was interested to read a report from July 2018 by the Scottish Parliament’s Economy, Jobs and Fair Work Committee, which was chaired by my colleague Gordon Lindhurst. The report contained a number of key points, including that there will be an indefinite ongoing need for cash and universal face-to-face banking provision; that the access to banking standard, with its post-closure-decision consultation, is failing and a binding pre-decision consultation is needed; and that there is a need for the UK Government to research the issue properly and come up with binding statutory and regulatory conclusions.

I know that the Minister listened intently and understood the concerns of Scottish Members when he addressed this issue at the Scottish Affairs Committee this morning. I hope that, with some of the asks from me and other Members, the UK Government can make some progress on this issue.

I hope that the Minister will look at the access to banking standard and toughen it up, because some banks are not part of it. As I said when I read out communications from a constituent and others, there are concerns that banks are not adhering to the standard. I also hope that he will engage with the banks about banking hubs; the banks have too easily written off that suggestion rather than engaging properly on it. Although I accept that there are commercial reasons why banks choose to leave towns, I hope that the Minister will accept that the situation is different when a bank branch is the last to leave a town or village, and that that has a far greater impact than earlier closures.

To conclude, there has already been a devastating reduction in the number of branches across Moray, across Scotland and across the UK. We almost always lose ATMs at the same time, and therefore access to cash as well. We need to reverse that trend. Banks can improve their image—it is not always the most positive—by listening to communities and working with them, and not by simply leaving towns and villages. To date, I do not believe that the Government have done enough. We can also improve our image on this issue by working with communities and ensuring that they retain the banking presence and bank branches that they so greatly need.

I intend to start calling Front-Bench spokespeople at 3.27 pm. That leaves roughly between four and five minutes if each Back-Bench Member who wishes to speak is to have an equal share of the time that is left; I leave Back-Bench Members to manage their time themselves.

It is a pleasure to serve under your chairmanship, Ms Ryan, and I congratulate the hon. Member for Moray (Douglas Ross) on securing this extremely important debate.

This is not the first time that I have spoken in this Chamber on this subject area. Last Thursday, we discussed a Treasury Committee report; the hon. Member for Oxford East (Anneliese Dodds), who is the Labour spokesperson this afternoon, also attended that debate. The issue cuts across two Government Departments and I hope that they will soon get their heads together and sort it out.

As has been said, Scotland has lost more than a third of its bank and building society branches in the last eight years. New analysis from Which? shows that 610 branches in Scotland closed between 2010 and 2018, and Santander’s recent decision to close 15 branches in Scotland will have a devastating impact on staff and local firms.

As we have heard, communities are devastated when local bank services close, and when the last bank goes it can have an unacceptable effect on local communities. In its report, the Treasury Committee said that

“there are still large sections of society who rely on bank branches to carry out their banking needs.”

As the hon. Member for Moray said, it is not only the elderly who need cash; everyone seems to need cash at some point during the week. If they cannot access it, there are real problems, and there is a deleterious effect on our local high streets and our local businesses.

The UK Government must step in and act; they can no longer argue that they cannot intervene. They made a similar argument about Royal Bank of Scotland closing branches, but we now know that the Treasury thought that it was okay to force RBS to pull finance from customers through the asset protection scheme.

The view of the Treasury Committee is that

“the Government should make changes to competition law to allow banks to share facilities in order to maintain a sustainable branch network”

I thank my hon. Friend the Member for Moray (Douglas Ross) for having secured today’s debate. This issue is of real concern to my constituents, who have been hit by a number of closures of bank branches in recent years. I am a member of the Scottish Affairs Committee, which has done a lot of work in this space: we have done a bespoke short inquiry into RBS’s significant run of bank closures, and we are going to do another one into access to cash. I am sure the Minister will be sick of the sight of me, since he was in front of the Committee this morning.

I will touch a lot on some of the points that our Committee has drawn out through our inquiry, and focus in particular on the impact of bank branch closures—especially the last bank in town—on the local post office network. That network is often used by banks as a justification for abandoning a community and a high street. It seems to me that banks effectively want post offices to do their work for them, often at a loss, as the hon. Member for Motherwell and Wishaw (Marion Fellows) has explained. From evidence given to my Committee, we know that banks do very little to ensure the longevity and sustainability of the post office network on which they rely so heavily. In East Renfrewshire, half a dozen post offices have closed over the past couple of years for a variety of reasons. Just about every single one of those post offices was included in the so-called consultation documentation produced by a local bank as the nearest place for customers to carry out their transactions.

The Government need to set out a clear policy paper on how to tackle this issue, and reform the access to banking standard from a voluntary agreement into something with more legislative backing. They also need to do more to facilitate genuine alternatives to banks using the post office as a quick fix when closing branches. Post offices are not a replacement for branch services, and their staff do not have the training to act as banking specialists; my hon. Friend the Member for Moray ran through a whole range of things that they cannot do and explained well the lack of awareness about the post office. However, it is crucial to ensure the post office network is receiving adequate funding to deliver banking services, rather than post offices subsidising bank branch closure programmes, which is effectively what is happening at the moment.

It is a pleasure to speak in this debate, Ms Ryan, and I congratulate the hon. Member for Moray (Douglas Ross) on having secured it. While I am always pleased to support any debate that the hon. Gentleman secures, I have a deep interest in this particular topic.

I used to come to these debates and talk about my rural areas and social isolation. As I did that, bankers nodded at me, all the while pushing on with their plans to close rural banks, which succeeded. The last banks in the Ards peninsula in my constituency closed over a year ago, although to give a bit of credit to Ulster bank, I highlight the fact that it provided a mobile bank and a customer adviser on a weekly basis. That has been useful, so some of the banks—one of the banks, anyway—took the opportunity to do something.

These closures mean that much of my constituency has no local branch. When that is paired with the fact that some areas of the peninsula are using dial-up internet, the isolation becomes incredibly clear. However, according to the banks, the numbers did not tally, and the customers could be relocated to another branch—how frustrating it was to watch that. It was fine until the closures started hitting the main town, Newtownards, which has a population of some 30,000 and serves the Ards peninsula. We saw the First Trust bank close, as well as the Bank of Ireland branch. Someone from Portaferry, some 30 miles down the road, has to travel to Bangor or Belfast simply to speak to their local bank.

I thank God for Danske bank, Ulster bank, Santander and Nationwide, which have carried out enhancements to their Newtownards branches. Those enhancements show their dedication to the local area, and I highlight them to anyone who asks me about those banks. I much prefer to work and do business with those who are prepared to have a local branch, paying rents and providing a service. Most people now are doing things online, which is phenomenal for the people whose lives are made easier by doing a lot online. My parliamentary aide is at that all the time—she is always on the app, moving her money around to cover bills, which is great—but at lunch time she goes down to Nationwide to lodge money in the children’s accounts; she has access to the banks and can do transactions there. How much more is this a case of enforced technology for people my age or older?

It is a pleasure to serve under your chairmanship, Ms Ryan, and I thank my hon. Friend the Member for Moray (Douglas Ross) for securing this important debate.

It is all very well for the banks to say that people are required to move with the times, but there is a generation out there who came through school having been taught mental arithmetic, not IT skills. Not all members of that generation will be fortunate enough to have children and grandchildren fluent in IT speak, with a knowledge of apps and so on, to act as trusted advisers and able to direct them through the technological maze. Not all have good memories for the passwords required, and it is a regrettable fact of life that our faculties fail us with age. I am testament to that.

On a brighter note, I congratulate staff and pupils at Kyle Academy in Ayr in my constituency, whose pupils are learning about cyber-crime and passing on that skill to others, including small businesses and the elderly in the Ayr community. I congratulate them.

Online is a modern maze where, on occasion, even the most skilled might fall victim to scams. At a rural crime event in my constituency, it was highlighted how a farmer had been scammed when purchasing and paying via an online bank account for expensive agricultural equipment. Might it have been different had there been a bank branch open to conduct that business? The banks and the Government need to instil confidence in the user of digital banking services, whether that is in relation to the availability and basic reliability of the internet in the first place, or protection from the cruel, heartless scammers who appear to be able to read bank cards or secure an individual’s bank details. Is it any surprise that, until the banks and Governments robustly and timeously minimise, if not eradicate, those known risks, the public will remain averse to bank closures and feel that they are being pressured to move online?

The banks place great emphasis on the fact that shared facilities exist through post offices by virtue of the Post Office banking framework, which is an agreement with around 28 high street banks, supported by the Government. However, stand-alone post offices are virtually a thing of the past as well. Most are incorporated into stores and, again, privacy is often an issue. Worryingly, some postmasters have contacted me, and I am sure many others throughout the UK, regarding the profitability of their business being driven down by the Post Office itself. Thankfully, the Post Office has been listening and in October we should see changes that afford greater support to sub-postmasters, which is to be welcomed.

It is a great pleasure to serve under your chairmanship, Ms Ryan.

I want to draw Members’ attention to the county of Sutherland in the highlands, which is part of my constituency. Since 2005, eight branches have shut. With the recent announcement that the Clydesdale is going to shut its branch in Brora, we will be left with precisely one branch, the Bank of Scotland in Golspie, in a very large county of 2,028 square miles, with a population of some 13,500 who will have only one branch left. For some people that means a 150-mile round trip to get to the bank, if someone lives in Durness in the upper north-west—a three and a half hour bus journey for my constituents. And it gets worse. We have talked about post offices and how the banks say, “Go online or use the post office,” but Clydesdale bank seems to have conveniently forgotten that the post office in Brora has been shut for some time, making a complete mockery of that.

I and other Members have always said that the point of having a real branch is to have a human face behind the counter. Even if people can go online—not a lot can in my constituency—if someone has a big payment coming along but they do not know what it is, which can be a real worry for people, old and young, it would be better if they could go into a branch and see somebody who would say, “This is what it is,” or, “This is a scam.” That is why we want the human face, which is very hard to replace.

In my huge constituency, we are told to use mobile banks, but it is not awful funny going to a mobile bank in Wick if it is sleeting in January. The weather in good old Wick can sometimes be very inclement.

My contribution is short, but the matter of Sutherland serves the purpose of helping all Members here today, because it provides such an extreme example: one branch in a vast county of 2,028 square miles, which is astonishing. However, I give credit where it is due to the Minister. He has met and listened to a cross-party group of MPs, and I think he has taken the issue on board, but I say to him from the bottom of my heart that we have to get something together. The hon. Member for Moray (Douglas Ross) made a superb speech. This is about getting the hubs to work. Where there is a will, there is a way before us. If we could get those hubs to work together that would not solve the problem, but it would make things a heck of a lot easier, so I say to the Minister, “Go and bang the banks’ heads together. Tell them to get off their backsides and get the show on the road!”

It is a pleasure to serve under your chairmanship, Ms Ryan, and I congratulate my hon. Friend the Member for Moray (Douglas Ross) on securing the debate. It provides me with an opportunity to review the position just over a year since the last bank branch closed in the market town of Bungay in my constituency, where there had been a bank branch since 1808 when Gurney’s, the predecessor of Barclays, opened one of its first branches.

Looking back over the past year, I shall highlight three issues. The first is the pace of change in the transition to what I would term an almost cashless society, which has been much quicker than anticipated. Very often when I am in a queue for a sandwich or a newspaper, I feel self-conscious as I get out my wallet. Invariably, particularly in London, I am the only person paying by cash, and I sense that eyes are gazing at me with a sense of bemusement. The transition is happening much quicker in metropolitan areas than in market towns and the countryside. The breakneck pace of change causes difficulties for the elderly, the disabled and, particularly, those on low incomes for whom cash provides the best means of managing a very tight budget.

Secondly, having ready access to cash is the main challenge that has arisen out of the Lloyds bank closure in Bungay last May. There are no longer 24/7 cashpoints available in the town centre. There is a cashpoint in the post office, but it is not accessible all the time, and when the extremely popular Sunday street fairs take place, there is a major drawback for traders without card machines.

It is also appropriate to highlight the emergence of a postcode lottery along the Suffolk-Norfolk border. In Bungay, there are no 24/7 cashpoints. Likewise, 9 miles away in Halesworth in the constituency of my hon. Friend the Member for Suffolk Coastal (Dr Coffey), there are no such facilities. However, if I go 8 miles west to Harleston, in the constituency of my hon. Friend the Member for South Norfolk (Mr Bacon), there are three such cashpoints within 100 metres of each other.

It is a pleasure to serve under your chairmanship, Ms Ryan. I congratulate my hon. Friend the Member for Moray (Douglas Ross), who gave an excellent speech, logically and rationally explaining a situation that we face in many parts of the United Kingdom but which, speaking parochially, is very much an issue for Scotland. If my hon. Friend the Member for Waveney (Peter Aldous) thinks that people look at him strangely when he uses cash in London, I encourage him to try using a Royal Bank of Scotland £20 note. Recently I was refused the opportunity to spend my money in London—an issue that I took up with WH Smith. I got a good apology, which is only appropriate.

Since I was elected to this House, I have been involved in many campaigns to fight unwanted and unnecessary branch closures. In my constituency, Balfron, Bannockburn, Bridge of Allan and St Ninians have no bank branches at all, owing to recent branch closures, and Callander is down to its last branch. When a town is down to its last bank and that bank is threatened with closure, I strongly believe that it is right for the Government to act—and I say that as a Conservative Member of Parliament.

We had an anomalous situation in Bridge of Allan, which may be of interest. Clydesdale Bank and the Royal Bank of Scotland both closed their branches at the same time. Each bank justified its closure by citing the existence of the other branch. How ridiculous is that? They have now both closed leaving the people of Bridge of Allan without a bank branch, despite both banks stating that there would be one. That situation must not be allowed to happen. The Government must be prepared to act to remove that kind of justification, when two bank branches announce their closure at the same time. When Royal Bank of Scotland closed its Bannockburn branch, it justified it in terms of proximity to city centre premises—but guess what: it then moved those premises further from the customers. The branch in question happens to be very plush, but there are a few obstacles to getting there in the first place.

I thank the hon. Member for Moray (Douglas Ross) for bringing this important debate forward. Moments of agreement are rare, so when they happen they should be celebrated in a mighty fashion—[Hon. Members: “Hear, hear!”]—although the debate is not over yet.

I feel that I spend half my time in this place—I do not exaggerate and I know that others will share this view—bemoaning the stampede of banks out of our communities without so much as a backward glance. I represent a constituency where several towns have no bank at all. They are Ardrossan, Stevenston, Kilwinning—a town of 21,000 people—West Kilbride, Dalry and Beith. Kilbirnie’s last bank is having its opening hours reduced, and that is the only bank left in the entire Garnock valley, where there are three distinct towns with a collective population of more than 19,000 people.

My constituency has been hit particularly hard, so I fully appreciate the similar concerns expressed by the hon. Members for Caithness, Sutherland and Easter Ross (Jamie Stone) and for Stirling (Stephen Kerr). In Scotland we have lost one third of our bank branches in just eight years. Research from Which? has shown that 610 branches closed across Scotland between 2010 and 2018. The recent Santander announcement of closures is the latest in a long line of such announcements from banks across the board.

The hon. Member for Stirling talked about consultation on bank closures being a tick-box exercise, and that is true. I remember the same thing happening in 2007-08 when there were, in my constituency anyway, mass post office closures. Perhaps naively and innocently—this was long before I was elected to this place—we had street stalls and went door to door with petitions to move the banks and Post Office, but nothing changed.

This has to stop. The Minister will be aware that the Treasury Committee concluded that

“there are still large sections of society who rely on bank branches to carry out their banking needs. A bank branch network, or at least a face-to-face banking solution, is still a vital component of the financial services sector, and must be preserved.”

It is a pleasure to speak with you in the Chair, Ms Ryan, in this interesting and well-informed debate, and to sit across from the Minister. I was starting to get withdrawal symptoms because there have not been many statutory instruments recently, although I am sure the Government will rectify that.

I congratulate the hon. Member for Moray (Douglas Ross) on securing this debate, as I know that the issue has seriously affected many of his constituents and local businesses. For those without an intimate knowledge of north-east Scotland, let me underline that the communities we are talking about are often far apart. They either have next to no public transport, or it is of poor quality and very expensive. Local facilities are therefore incredibly important.

As the hon. Member for Motherwell and Wishaw (Marion Fellows) rightly said, we had a debate on a similar topic just a few days ago. It was mentioned that in certain circumstances an ATM might close on a high street that still has a number of different facilities. We are not talking about that in this debate; we are talking about situations where few facilities are available. This is not about duplication; it is often about the last services moving away. As the hon. Member for Strangford (Jim Shannon) said, this is about social and rural isolation.

High street banks are an essential part of our financial infrastructure and they help to support local economies and communities. The bank branch network has been shrinking at an accelerating pace. Many statistics have already been given, but the UK has lost nearly two thirds of its bank and building society branches over the past 30 years. In 2018 and 2019, banks and building societies will have closed, or planned to close, a total of 1,080 branches, and 3,318 branches have shut in the past four years. Banks have been closing at a rate of nearly 70 a month. Overall, a fifth of the population lives more than two miles from their nearest branch—and a good deal further away in some of the situations that have been mentioned.

It is a pleasure to serve under your chairmanship, Ms Ryan. I congratulate my hon. Friend the Member for Moray (Douglas Ross) on securing this important debate. I acknowledge the contributions of all who have spoken this afternoon. I have listened carefully to the speeches, and it is good to have seven of my hon. Friends from north of the border here. I will endeavour to answer the points substantively.

I gave evidence to the Scottish Affairs Committee this morning on this very issue. Straight after this debate, I hope to make a speech at the Which? cash summit, where I will set out the work being done by industry, the Government and regulators to ensure that access to cash is safeguarded. I recognise that this is a very important issue for many of our constituents. In my own constituency of Salisbury, I have seen bank branches close and I understand how difficult that is for communities. We have heard some specific examples this afternoon of the distress that can be caused when the process does not go smoothly. I recognise there are different opinions across the House about how the challenge should be met, and I will address those shortly.

Undoubtedly, the fact that the retail financial landscape is changing rapidly, as more consumers and businesses opt for the convenience, security and speed of digital payments and digital banking, is a significant factor. Ten years ago, cash accounted for more than three fifths of all payments in the UK; today, the figure is less than three in 10—and that is anticipated to fall to less than one in 10 in nine years, by 2028. In 2017, debit cards overtook cash for the first time as the most frequently used payment method in the UK.

I am very sensitive to the point made by the hon. Member for North Ayrshire and Arran (Patricia Gibson) that debit cards are not everyone’s choice; it is really important that we keep in focus the need to maintain access to cash. In 2018, two thirds of UK adults used contactless payments, 72% of UK adults used online banking and 48% used mobile banking. How we use financial services is changing and consumers have more choice than ever. It is an exciting time, but it is also a disruptive and potentially confusing time for our constituents.

The Minister says that closing a bank is a commercial decision and the banks are listening to their customers. How can they be listening if they take those decisions prior to any consultation and if, when they are encouraged to engage, they do not even turn up?

That behaviour that my hon. Friend experienced in his constituency is not best practice. It is not acceptable. It is very unfortunate when that happens. My job is to try to ensure that there is a systematic upgrade to the quality of the consultation and engagement from the banks, and I will now set out what is happening.

The access to banking standard has been noted by a number of colleagues today. Since May 2017, the major high street banks have been voluntarily signed up to the standard, which commits them to work with customers and communities to minimise the impact of branch closures. The standard ensures that banks keep customers informed about branch closures, and that the bank sets out its reasons for closure and the alternative options for continued access to services. How meaningful that consultation process is has been raised, on the basis that it happens when a decision has been made and not prior to the decision. I am looking into that. I have written to the Lending Standards Board and will be meeting its representatives to discuss the matter further.

The options for continued access should include specialist assistance for customers who need more help. For example, the Lending Standards Board, which monitors and enforces the standard, has told me it sees evidence of support from firms to assist customers in understanding and using alternative banking options. I recognise that that happens in some, but not all, cases. Such support might include digital experts being placed in the relevant branches to demonstrate how mobile and online banking works and assisting those customers who wish to use that functionality, as well as making introductions to nearby post offices and retained branches.

I continue to be very supportive of the access to banking standard and I value the commitment it places on banks to communicate the next steps for customers when the decision is made to close a branch, but I am aware of the concerns that colleagues have expressed about the standard. I confirm that I recently wrote to the Lending Standards Board to seek reassurances that the access to banking standard remains fit-for-purpose, and I intend to meet the chief executive to discuss matters further, drawing on the meetings I have had with various groups from all parts of the House and on the representations made so forcefully by colleagues this afternoon.

First, I thank you, Ms Ryan, for how you have chaired this debate; there was a subtle change in your demeanour indicating that I had spoken for long enough, and that ensured other colleagues were able to speak.

I am grateful to the hon. Members for Motherwell and Wishaw (Marion Fellows), for Strangford (Jim Shannon) and for Caithness, Sutherland and Easter Ross (Jamie Stone); to my hon. Friends the Members for East Renfrewshire (Paul Masterton), for Ayr, Carrick and Cumnock (Bill Grant), for Waveney (Peter Aldous) and for Stirling (Stephen Kerr); to the hon. Members for North Ayrshire and Arran (Patricia Gibson) and for Oxford East (Anneliese Dodds), the Opposition spokespeople; and to the Minister for a constructive, detailed and hopefully positive debate—not only for Lossiemouth, Moray and Scotland, but for communities across the United Kingdom that have been affected in this way.

The Minister said that the Government have made progress, which is welcome, but we can also agree that there is more to be done after this debate. His constructive response shows that the Government are listening. I have written down the actions that he is taking at the moment and that he will take going forward, but he will be left in no doubt by today’s debate that there are still major issues in all our constituencies that need to be tackled. There was mention of banging heads together and carrots and sticks: we have to use any and all means to find a solution to the problem. Although it is useful to have had this debate, talking only goes so far. We need action, and we need it now. I am encouraged by this debate that that will happen, but the pressure will remain until we can ensure that our communities can continue to be served by the banks they need.

That this House has considered the Government response when the closure of the last local bank is proposed.