The Rates (Exemption for Automatic Telling Machines in Rural Areas) Order (Northern Ireland) 2024

Part of Executive Committee Business – in the Northern Ireland Assembly at 3:30 pm on 14 May 2024.

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Photo of Matthew O'Toole Matthew O'Toole Social Democratic and Labour Party 3:30, 14 May 2024

Again, I speak for the Committee for Finance about our scrutiny of the statutory rule. I thank the Minister once again for her comments.

The Committee spent considerable time discussing the policy proposal to reinstate a micro-policy in the rating system, giving a rates exemption to ATMs in a designated rural area. The policy was first considered by the Committee on 6 March 2024. At that time, members agreed to seek clarification from the Department of Finance on recipients most likely to benefit from the rates exemption. At the Committee's meeting on 20 March 2024, members noted information from the Department that highlighted the fact that the majority of recipients of the relief are banks or electronic money services companies. The Department indicated that that has been the case since the scheme was first put in place and that one aim of the scheme is to encourage banks and money services companies to keep the ATMs in their current locations.

Some members expressed concerns that a number of recipients of the exemption are banks. The majority of members, however, indicated that the proposal has merit. The Committee agreed that it was content with the proposal for the statutory rule. SR 2024/88 was laid in the Business Office on 4 April. At the Committee's meeting on 17 April, members noted that the Examiner of Statutory Rules (ESR) had not drawn any matters to do with the rule to the attention of the Committee. While members agreed to recommend that the rule be affirmed by the Assembly, further information was requested from the Department on a number of issues relating to rural ATMs, including statistics on the number of rural ATMs over the past five years, on the current location and operators of rural ATMs and on whether the Department has considered ways in which to publicise the availability of a rates rebate for rural ATMs. The Committee also agreed to request information on how many current recipients of the rates rebate for rural ATMs charge for the use of those ATMs — ie which are the kind that charges people £1 or £2 to withdraw cash rather than the free ones.

In Committee on 8 May, members noted the geographical distribution of the current ATMs that are valued as separate rateable entries and are exempt from rates under the scheme. Members noted that the valuation approach to ATMs has significantly altered following a Supreme Court ruling in Cardtronics UK Ltd and others versus Sykes and others, and, as a result, the number of ATMs valued as separate entities in the valuation list has significantly reduced. However, that does not mean that the ATMs are no longer in place but that they are no longer valued separately. The Committee also noted that the rate exemption for rural ATMs is not a rebate. It is applied automatically before bills are issued according to rural wards set out in legislation and known to the Department. Therefore, it is felt that publicity is not required.

Finally, members noted that the Department does not hold data on which operators charge for ATM services. During the Committee's consideration of the rule, members noted with concern the more general decline of banking institutions and ATMs in rural areas. Members have agreed to look at the issue more closely as part of a piece of work around banking services. The Committee supports the motion to affirm.

I will now make some brief remarks in a political capacity. We obviously support what is, in cash terms, an extremely small measure but is useful nevertheless. It is vital for rural communities to keep hold of ATMs because access to cash is extremely important in all areas but particularly in rural areas. Those cash services help to support such things as small, charitable, community, sporting groups and clubs in all their activities, endeavours and fundraising. It would be unthinkable to see a further decline in the number of ATMs.

Some of what we learned in the Committee suggests that it is important that the Department, having taken this step and the fact that we are debating the legislation today, does all that it can. I welcome the fact that the Minister met UK Finance and the banks, and I would welcome an update from her on the contents of that conversation. As much as is possible should be done to really dig into the locations of rural ATMs and to be absolutely blunt and direct with all of those institutions about the availability of the rate relief. It is not a huge measure. It is a self-described micro-measure, but the fact that it exists means that it should be communicated loudly and publicly to all of the banks so that any excuses for removing services — whether full-blown branches or ATMs — are removed. I would welcome the Minister updating us on that, including on whether there is some kind of partnership with UK Finance or some way of communicating that.

I would also suggest that, given that some of those people will be members of retail bodies, such as Retail NI or the Federation of Small Businesses (FSB) — often ATMs in rural areas are in the forecourt of the Spar garage, Vivo or whatever — any communication that can be given to those entities, whether they are a bank or retail premises that might not already be availing themselves of an ATM service or might be thinking of closing one, is critical, given that the amount of money does qualify. I do not want to be too flippant about this: it is a trivial sum of money, even in constrained times, but it is not a trivial issue for rural communities.

I would also just make a point about financial services. I welcome the fact that the Minister is reaching out to organisations such as UK Finance and banks in general. We will have a debate on related matters later, around insurance services. It gets to a broader point that the Committee has agreed to look at around financial services here. We are in a particular, unique position, and we have never quite grasped it in the devolution era. Financial services are a reserved matter; they are a matter for the Treasury. I think that the Minister would agree that, in the Treasury — this is not to impugn the officials working in financial services there — as is the case with lots of things, the needs of Northern Ireland and the specific financial services picture here, including the rurality of our society, are not well understood or, frankly, a priority. We cannot expect financial services policy to be designed and tailored for this region, so we need to think hard about how we, as an Assembly and an Executive, can be front-footed and even proactive, even if the policy matter is, technically, reserved. That would involve communication with the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA), so I genuinely welcome the fact that the Minister has already started that engagement. It is vital that she and the Finance Committee do as much as they can in that space.

Banking here is regulated by the PRA, the Bank of England and the FCA, but, obviously, our banking market is structurally different. We know that it is much more all-island, which means that it has been affected by Brexit. We also know that we have a much more rural society and that small business is a bigger part of the economy than it is across the water. It is really critical that, in what is left of the mandate, we try, at the least, to agree a set of interventions that we can take to the people in London who make the decisions about financial services in this society and what they mean for our economy.

I wanted to make those broader points, but we support the order.