Financial Exclusion: Access to Cash — [Sir Henry Bellingham in the Chair]

Part of the debate – in Westminster Hall at 10:48 am on 21st May 2019.

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Photo of John Glen John Glen Minister of State (Treasury) (City), The Economic Secretary to the Treasury 10:48 am, 21st May 2019

I am always sympathetic and listen carefully to credit union chief executives and their experiences. I have been in the Treasury for 16 months, and rarely does a week pass without my receiving notification of a credit union that could be in difficulty. If we are to loosen the regulatory reform and enable more transactions and more functions of credit unions, we need to ensure that we have the governance in place, so that people do not fall foul of credit unions that go the wrong way. It is a complex area. I am not trying to be patronising, but it is important that we get a joined-up policy solution that pays attention to the sector’s requests.

Although maintaining access to physical banking and cash is important, there is another, equally important side to this story: ensuring that the benefits of new technology are felt by all, and that everyone has the ability to participate. For people who need to keep tight control of their money, and for those who cannot afford to lose a penny, the ability to check their bank balance on the go, or to freeze a card instantly, is critical. We know that too many people are currently excluded from such benefits.

Recognising that the advantages of digitalisation should be felt by all, the Government’s digital strategy commits to enabling people in every part of society to access the opportunities of the internet. We have established the digital skills partnership to bring together the public, private and third sectors to address the digital skills gap in a more co-ordinated and collaborative way. From 2020 we will introduce an entitlement for adults who lack basic digital skills to undertake fully funded basic digital skills training. This new entitlement will mirror existing entitlements for adult literacy and numeracy training.

I want to address the point made by my hon. Friend Bim Afolami. The new Money and Pensions Service will simplify the current public financial guidance landscape and offer a more holistic approach to financial education. I am talking to representatives of UK finance and the voluntary sector to look at how we can get a more co-ordinated approach to financial education, which is always raised in these debates.

The Government recognise that access to the internet depends on being able to connect to it, and we are making progress with this problem. Superfast broadband, providing downloads of at least 24 megabits per second, is now available to 96% of UK homes. Hon. Members will have seen that last Sunday we launched the Rural Gigabit Connectivity programme, a £200 million investment that will enable communities that have not previously benefited from broadband to leapfrog to the most advanced fibre technology. I hope that will be a solution for colleagues who represent the most rural constituencies.

I will conclude, in order to give the hon. Member for Feltham and Heston an opportunity to respond. We all agree that vulnerable customers must not be left behind as digitalisation changes the way we bank and pay for things. Of course, part of that is about ensuring that physical banking and cash remain available to people who need it—the Government, regulators and industry are already taking action to ensure this. However, it is equally important that we redouble our efforts to ensure that all our constituents benefit from new technology. We cannot reverse digital innovation and nor should we, given the benefits they bring to our constituents.

I want to end with a call to arms to industry to think about all consumers—not only when they are considering the future of cash and physical banking, but when they design new digital products and bring new innovations to the market. I will keep pushing industry to achieve this, and I hope hon. Members will join me in doing so.