Tomorrow, May the fourth, is Star Wars day. I was going to write about it, but I notice that rather like the planet Alderaan, our banks are disappearing. Any similarity between Darth Vader and bank bosses is purely coincidental.
South Leeds Life carried the story last week that Yorkshire Bank plan to close their branch in Middleton next month. We’re also hearing that NatWest plan to close their Hunslet branch. HSBC closed their Beeston Hill branch last year. In fact if you think back a few years a lot of bank branches have closed in South Leeds. It is a trend that is repeated across the country.
As a regeneration professional, I was taught that one indicator of an excluded community, was the lack of a bank. Installing a free ATM (hole in the wall, cash machine) could therefore be a radical act that improved people’s lives. At least most of the banks have left an ATM when they’ve closed their branch in South Leeds recently.
There is a very simple business case for branch closures. Most customers don’t go into their local branch, or at least not very often. You can do most things – check your account, pay in cheques, draw out cash, etc – by post, by telephone or now over the internet. This is convenient for most customers and very convenient for the bank. The bank can now employ fewer staff in one place, rather than a few staff in a lot of places. That’s easier to manage and they can sell off the buildings.
So what’s the complaint about bank branch closures?
Banks aren’t just businesses, they have become a service that we can’t do without. It was Margaret Thatcher (her again) that repealed the Truck Acts, which gave workers the right to be paid in cash. Successive governments have encouraged, then required pensions and benefits be paid into bank accounts. This process will be completed by the introduction of Universal Credit. The wage packet and the Giro are gone, we all have to have a bank account.
If banks were just a business they could move their operation where they like – they can take the risk that they will lose customers. But if they have become a service, don’t they then have a responsibility to serve?
We have lost a lot of our Sub Post Offices, but at least that was planned. 90% of people, I think, live within so many miles of a Sub Post Office. It seems we need similar regulations that state that bank branches must be located within a certain distance of where people live. Of course we have competing banks, so this responsibility will have to be shared out – Yorkshire Bank can have Middleton, NatWest can have Hunslet …
I don’t know about you, but I’m seeing a bigger picture here.
Society is currently organised on business lines, the market decides, in this case that Yorkshire Bank should close its Middleton branch. The business makes more profit, which must be good, right? On no, hang on, that goes to the shareholders and the bosses. But we get jobs right? Oh no they’re closing the local branch.
The market is brilliant isn’t it? The former HSBC on Beeston Road is being converted into a pharmacy. Very useful, except that it’s next door to Boots and across the road from an independent pharmacy. I know we have poor health in Beeston, but that’s ridiculous!
Alternatively, we could organise society so that businesses serve the majority of people. Essential services like banks and shops could be located where we need them, rather than where they want to be. I think it’s called planning, or possibly even (whisper it) Socialism. It’s pretty radical, but isn’t it worth a shot?
I’ll be back next week with more of my views from South of the River. If you’re on Twitter, you can follow me: @BeestonJeremy.