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I welcome the chance to speak in tonight’s members’ business debate and I thank Sandra White for securing it.
Bank of Scotland branch closures in the north-east region have—and will continue to have—consequences for many of my constituents; in particular, they affect both Dundee and Kirriemuir, with branches closing in both places.
For clarity, I am a customer of Bank of Scotland and also of the Lloyds Banking Group, which owns Bank of Scotland.
The rate of bank branch closures has been steadily increasing for the past few years. The number of bank branches in Scotland fell by a third between 2010 and 2017, with five banks closing 488 branches between them. Bank of Scotland has shut 87 branches since 2010, going from 293 to 206, which is a 30 per cent decrease. Robin Bulloch, from Bank of Scotland, told members that the 30 per cent reduction in the number of branches was a “measured and gradual approach”, taking into account the changing habits of customers, with people shifting to online banking services.
However, the Economy, Jobs and Fair Work Committee found that closures had left communities and local businesses feeling “abandoned”. In March, the committee opened an inquiry into bank branch closures with the aim of gathering evidence on the effect on local businesses, customers and the economy. On closer questioning of the five banks—Bank of Scotland, RBS, Clydesdale Bank, TSB and Santander—it emerged that none of the banks had held a formal consultation process with local people before deciding to close a branch. Many members have referred to that.
The closure of Bank of Scotland’s flagship city branch on the Nethergate in Dundee is a blow to customers and staff alike. The branch will close at some point between February and June next year. That is yet more bad news for the city. Last year, more than 250 jobs were axed at the Bank of Scotland group’s call centre in the same West Marketgait building after it was closed. Following that closure, some staff were offered voluntary redundancies, while others were offered the chance to transfer to the bank’s Dunfermline call centre, which, of course, is more than 50 miles away. Current customers of the branch that is set for closure in 2019 will at least have their accounts re-aligned to Bank of Scotland’s Fairmuir branch on Clepington Road, which is 2 miles away.
Bank of Scotland bosses have blamed the latest decision on the changing ways in which customers choose to bank, claiming that 79 per cent of Dundee city’s personal customers predominantly use telephone or online banking, or alternative branches. A Bank of Scotland spokesperson said:
“We have made the difficult decision to close the Bank of Scotland Dundee City branch in February 2019 due to the changing ways customers choose to bank with us ... customers can continue to access their banking locally by visiting the nearby Post Office, which is less than half a mile from the branch.”
However, while many people are switching to online banking, there are concerns among many communities—particularly the vulnerable, elderly and disabled—about how the closures will affect them. According to Age Scotland, 37 per cent of people over the age of 60 in Scotland do not use the internet, which is equivalent to the size of Edinburgh’s population. My colleague Gordon Lindhurst MSP has said that members of the Economy, Jobs and Fair Work Committee and the Scottish Parliament were
“in no doubt that the loss of branches has had a negative impact on communities and businesses across Scotland.”
Kirriemuir in the north-east region will have no physical Bank of Scotland branch after the bank announced that it is to close next year. The town has a population of around 6,500 to 7,000 who will be left without a bank. That not only deprives residents of a service but affects shopkeepers and business owners who are already under normal commercial pressures. The nearest bank for those living up Glen Isla will probably be Blairgowrie, while others will have to travel to Forfar for their closest Bank of Scotland branch.
A 2017 report by UK Finance found that 71 per cent of adults used online banking in 2017, amounting to 38 million people. Furthermore, debit and credit cards overtook cash and coins as the most commonly used method of payment in the UK last year. Many people feel as though they have been abandoned by the banks following the closures, and that the alternatives offered do not meet their needs. It is vital that people have access to cash and face-to-face banking services. As the Economy, Jobs and Fair Work Committee concluded, the banks must engage properly with people and businesses on their needs before deciding to close branches in the future.
As we can all see across our constituencies that have been affected by bank branch closures, it is not just the customers who suffer. Jobs, businesses and the high street are also impacted. Job losses and empty buildings on what were once busy shopping streets are proof that there have been and will continue to be many negative impacts of branch closures.