To ask Her Majesty’s Government what assessment they have made of the impact on rural communities of the decision by Barclays Bank to end cash withdrawal services from the Post Office.
My Lords, the Government are disappointed by the withdrawal of Barclays from the renegotiated banking framework. None the less, the new banking framework will enable customers to access their cash from 27 high street banks. The Government will continue to ensure that communities receive support and have choice about how they manage their finances.
I thank the Minister for his reply. Rural communities rely on access to finance, but in many rural areas where there is poor broadband or weak mobile signal, online banking is impossible. This is a fundamental issue for our rural areas. What representations have Her Majesty’s Government made to Barclays Bank, and what will we do if other banks decide to follow its lead?
The right reverend Prelate asks an important question: does this set a precedent? I certainly hope not. I would like to think that customers affected will reflect carefully on whether they should continue banking with Barclays. I am fully aware of the issues faced by those in the rural communities of which he speaks.
My Lords, is the noble Lord aware that other countries, including France, the Netherlands and New Zealand, have saved much of their rural post office network by supporting their role as deliverers of financial services? Is he further aware that there are now more post offices in rural England than all the banks put together? In some areas of rural England, only post offices are serving the financial needs of local traders. Will the Government please offer some financial or fiscal incentive for Post Office Counters Ltd and all the banks to work together to ensure that the future of their local traders and communities is safe?
The noble Lord is correct. Since 2010 we have invested £2.3 billion in the Post Office network, stabilising the number of banks. There was a 27% decrease in the 10 years before 2014. The decrease since then has been only 1%—the money is making a difference.
Baroness Bryan of Partick (Lab)
My Lords, does the Minister agree that the idea of changing a bank is a bit more daunting than he has suggested? Particularly if you are struggling on a daily basis to stay out of the red, the idea of going to a new bank can be intimidating. It seems that some banks are interested only in big cashless customers who have large deposits and not really anybody else. Will the Minister raise these concerns with Barclays Bank and ask it to think again? The banks are making life difficult, not only for people in rural communities but for those in inner cities and the peripheral schemes where paying cash machine charges is extortionate.
The noble Baroness and the right reverend Prelate asked what representation we have made. My right honourable friend the Secretary of State for Business, Energy and Industrial Strategy has spoken to Barclays in words of only one syllable, I am afraid. She has made this point very clear to them: this behaviour is not acceptable. This is not about corporate banking; this is about rural communities and, sometimes, these are the most important aspects of rural communities.
My Lords, I understand that some of the major banks are making it extremely difficult for small organisations to retain their bank accounts when, for instance, they change their bank mandate. Can the Minister tell the House whether the banks have a responsibility to serve their communities in this way, or will these accounts be treated in the same cavalier way that Barclays has treated them in rural communities? If they are, where will these organisations go for their banking?
The noble Baroness puts her finger right on it. Banks are not just about serving customers; they are about serving communities as well. When small organisations are unable to secure that banking, they will struggle. If she has specific examples, I welcome them being raised with me and I will raise each of them directly with the individual bank concerned.
My Lords, would it be possible for the Prime Minister to write to the chairman of Barclays Bank on this matter—perhaps with his signature at the bottom of the letter this time?
My Lords, does this Question not also raise the problem about access to cash more generally? I am sure the Minister is familiar with the Access to Cashreview. I wonder whether the department is in a position yet to respond to that. In that excellent review were six recommendations, which focused on the fact that new fintech is often designed for mass markets and does not reach out to the poor, those who live in rural communities and the vulnerable. Of the recommendations, the fifth and most important was for a clear government policy on cash, supported by a joined-up regulatory approach that treats cash as a utility, which I think is what the noble Lord was saying at the end. Is this in progress?