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Chamber and committees

Meeting date: Tuesday, June 14, 2016

Meeting of the Parliament 14 June 2016

Agenda: Time for Reflection, One Minute’s Silence, Topical Question Time, Greenhouse Gas Inventory 2014, Colleges and Universities, Decision Time, Royal Bank of Scotland (Prestonpans Branch)


Contents


Royal Bank of Scotland (Prestonpans Branch)

The Deputy Presiding Officer (Linda Fabiani)

The final item of business today is a members’ business debate on motion S5M-00113, in the name of Iain Gray, on the closure of the Royal Bank of Scotland’s Prestonpans branch. The debate will be concluded without any question being put.

Motion debated,

That the Parliament notes with concern the proposed closure of the RBS branch in Prestonpans on 9 August 2016; understands that this will leave RBS customers without a branch in the town and with a trip to either Tranent or Musselburgh for their nearest branch; is unaware of any effort made by the bank to consult the local community and that RBS cites an increase in online and mobile transactions as a contributing factor to the closure; believes that this is unfair to many customers who have been loyal to RBS over the years particularly older customers and those without access to the internet who will be most affected by the closure, and notes calls for the bank to reconsider this decision and put the needs of its customers first.

17:07  

Iain Gray (East Lothian) (Lab)

I confess that this is not the first time in my time as an MSP that a bank has closed a branch in one of the communities that I represent, but it is the first time that I have brought a closure to Parliament through a motion and debate. The reason for doing so is very straightforward: the RBS branch in Prestonpans is the last bank branch there and when it closes—the closure is planned for August—there will be no banks in the town. That rather brings home a truth that we in the Parliament sometimes forget: Scotland is not a country of half a dozen cities, but is much more a country of hundreds of small towns. We should guard their sustainability and viability with great care.

There are certain institutions in any town that make it viable: a school, a post office, a doctor’s surgery, a police station and a bank. To lose the last bank in a community is therefore a serious matter. Indeed, the banks themselves understand that, because they had, until recently, an agreement that wherever a branch in a community was the last bank, whichever bank ran it would not close it. That agreement has simply been binned.

The closure has provoked such a reaction in the town of Prestonpans and the county of East Lothian because of the seriousness of the matter and the threat to the community’s sustainability and viability. That is why the local Labour Party—Prestonpans branch Labour Party—has mounted a petition against the closure and has been out on the street in front of the bank collecting signatures for some weeks now. It is also why the first signatory to that petition was one Jimmy Yule, who is the chair of Prestonpans community council. The council has also made clear its concern about the closure of the bank.

I understand that the institutions that I listed that make our communities viable—schools, post offices and so on—are largely public sector, or partly public sector, or were once public sector, and that RBS is a commercial operation. I cannot deny RBS’s case that fewer of its customers are using branches directly, with more customers banking online and so on. However, RBS must understand that that does not mean that no one uses that bank branch. In fact, a number of people sent their experiences to me; all are in a similar vein. Here is one person’s experience:

“Unbelievable experience in the bank this afternoon, queues constant, average waiting time 20/25 minutes, the reaction from members of the public was amazing with people constantly coming up and wishing us good luck with the campaign. A few old ladies were explaining to me that they don’t have computers so don’t bank online,”

and there were

“people opening the door and saying, ‘oh hell the queues are out the door again’ and leaving.”

It is not a branch that has no customers. The customers who use it do not understand why they are now expected to go to RBS branches in Tranent or Musselburgh; those communities are not easy to reach and have several branches of different banks themselves. Customers are also reluctant to trust RBS because they remember that branches close by, in Port Seton and Longniddry, were closed many years ago, and that commitments that were made then about ATMs and alternative facilities were not kept.

Above all, the closure will not suit elderly or disabled customers. One person who signed the Labour Party petition made that clear when she said:

“My aunt is disabled and can’t get any further than the Prestonpans branch due to her disability and panic attacks when she gets on the bus to go further afield this local branch is needed for the disabled/elderly”.

Another said:

“I work as a care worker with the elderly in Prestonpans. They are all so worried and stressed with the thought of the bank closing. Since receiving the letters last week”

their conversation is about nothing else.

The closure does not suit small businesses, either. A number of people who work in small shops on Prestonpans High Street have expressed concern to me because part of their duties when they close in the evening is to take cash to deposit in the drawer in the branch, which is just across the road. They certainly do not want to be asked to get on a bus and travel to another town altogether while carrying the day’s takings.

Curiously, however, it is also a closure that does not suit children. One signatory to the petition said:

“I use the bank regularly to pay in my account and also my 4 year old son likes to go weekly and pay in ... his ... savings account book”.

They added that he loves

“his weekly routine of banking for him then lunch from bakers straight from nursery, which he will miss if I have to travel ... to another branch”.

That is the nub of it; that four-year-old boy is RBS’s customer of the future and he is one of the people who is losing faith in that branch.

RBS is a bank that often spends time trying to promote a very positive image. In another campaign that I am involved in with Grace Warnock—the “Grace’s sign” campaign—RBS has been very supportive of that new sign for disabled toilets and has installed Grace’s sign in its own offices. However, in the end it is how RBS treats its customers that matters and there are customers of many years’ standing who are angry with the bank. They are angry, too, because they know that not so long ago the bank looked to them, as taxpayers, to bail it out when it was on the point of collapse. The bank promised then that it would return to doing the things that we expect our banks to do. One of the things that we expect our banks to do is to be there on our high streets when we need them. That is why RBS should change its mind about the decision.

17:14  

Bruce Crawford (Stirling) (SNP)

As is customary, I begin by thanking Iain Gray for lodging the motion. He has effectively set out the position in Prestonpans on the proposed closure of the bank there. As members might imagine, the story that Iain Gray has just told could be told about small towns in many parts of Scotland; indeed, two banks are due to close in my constituency, in Stirling and in Callander. It is not good that the one in Stirling is closing, but at least there is another Royal Bank of Scotland and other banks for people to choose there. However, the closure in Callander could have a real impact, which I want to come back to.

Iain Gray rightly reflected on the reality of new technology such as online banking. Of course, more and more young people are doing their banking online. I do not know whether I am still classed as young, but I certainly do my banking online—I am not so chronologically challenged that I cannot achieve that. However, many people who are a generation older than I am are not as able to access online banking. I know that there is potential for post offices to be involved in banking for older people, but older people want banks on their high streets.

Iain Gray is right about the issues for small businesses. There is a particular issue about cash at night when businesses close; there is a real security fear for some small businesses if the cash that they have raised during the day cannot be taken care of effectively.

Obviously, closures are about the bottom line, how the bank works and whether it can be a profitable organisation following some of the challenges that it faced a number of years ago after the crash in 2008. However, I believe that the majority of the shares are held by the Government; therefore the shareholders are the people who are being affected by the closures—whether they are in Prestonpans, Stirling or Callander. I have stressed to RBS that although there might be a bottom-line issue and the market might be changing, it has social responsibilities to the customers whom it has served over a long period. The bank has taken financial resources out of the communities in which it has operated and has used those in its own way to make profit, so it has a bit of responsibility back the other way in those communities.

That is particularly true in Callander, which has had challenges in Main Street in the recent past. I spoke to the bank and tried to persuade it not to consider closing the branch there, please, because of the potential impact on the town as it begins to try to readdress its place in the marketplace. That is probably a forlorn hope of mine—as Iain Gray’s hope is probably forlorn—but I have asked the bank to consider at least extending the life of the branch until a better outcome is found for Main Street in Callander.

Iain Gray talked about other issues in the Prestonpans area and about what holds the community together. Alongside issues in small rural towns throughout Scotland such as lack of connectivity or the fact that public transport is becoming more and more of a difficulty, a bank closure becomes a really significant issue in people’s lives.

I am delighted that Iain Gray has provided us with the opportunity to speak on this important matter. The debate allows members to highlight not only Prestonpans but the particular challenges in their communities, which I am sure they will do. I thank Iain Gray again.

17:19  

Rachael Hamilton (South Scotland) (Con)

RBS continues with its savage cuts—closing down more branches on our Scottish high streets, this time in Prestonpans. Only in banking could a company post a loss of £2 billion, hand out £370 million in bonuses to staff and then continue with its ruthless foray into branch closures. Banks should think more about their social responsibilities to vulnerable people and less about profit margins.

I am not sure whether anyone remembers that back in 2010 RBS pledged never to close a branch that was the last branch in town. So what has changed? RBS says that low footfall is to blame and that a significant shift to digital services has happened. However, a large proportion of Prestonpans residents are pensioners and are not all—contrary to the belief of RBS senior management—adept with an iPad. Over-the-counter banking should still be available to those for whom internet banking is not an option.

Business customers are equally important. They require daily banking services and change orders, for which the bank charges handsomely. Competition from out-of-town centres is fierce, and small shops and businesses require essential services to survive and compete.

Sadly, a similar and irretrievable pattern of closures has emerged in the Borders. The RBS branch in Newtown St Boswells shut recently, shortly followed by the Earlston branch. The RBS website does not mention lunch-time closures at the Melrose branch, but the branch religiously continues inconveniently to take a lunch break. Perhaps it is covertly but purposefully weaning its loyal customers off its services.

I remember when my old man enjoyed a whisky at the kitchen table with, and was on first-name terms with, his bank manager, who knew the business inside out. Banks have lost the plot, and I urge RBS to reconsider its proposals.

That brings me on to another contentious subject in East Lothian; service-supply issues are not associated only with banking there. More than 10,000 homes are expected to be built there by 2024, and communities have repeatedly raised concerns about the impact that additional housing will have on the county’s infrastructure. Fears that schools and doctors’ surgeries will be unable to cope, and concern about the potential for there to be thousands more vehicles on the roads and overcrowding on trains are topped by the on-going closure of high street banks, which is unacceptable. I hope that the Scottish Government will set out its plans for how best to deliver that growth.

It is important that residents of East Lothian receive the best possible deal on infrastructure, and the implementation of a strategy that will best mitigate the impact of population growth. There is an underlying assumption that the A1 and the east coast main line can accommodate the growth, but that is untrue: both are at capacity. Our local train services are full before they reach Wallyford, and car parks are overflowing. Abellio has said that it will be years until it increases capacity to meet current demand, so how can we have any confidence that it will be able to meet demand? Peak-time rail services between Edinburgh and North Berwick are woefully overcrowded and we are still waiting for the long overdue reopening of the East Linton and Reston stations and for the dualling of the A1 trunk road to the English border.

The pressures on East Lothian continue. Many residents require a car to travel beyond Edinburgh, yet the trunk road network is grinding to a halt, and that is before the massive cumulative predicted growth of Midlothian and Edinburgh. Old Craighall, Sheriffhall, the Edinburgh city bypass and beyond all need massive amounts of investment and planning, but nothing has been done to address that.

I ask Transport Scotland and the Scottish Government not to fail East Lothian as RBS has failed it and I urge them to outline how they will address the infrastructure issues. I also ask RBS to reconsider the Prestonpans closure.

The Deputy Presiding Officer

I remind members that members’ business speeches should address the motion in hand and that the minister will respond only to the motion.

17:23  

Jackie Baillie (Dumbarton) (Lab)

Like others, I thank Iain Gray for securing the debate. It is clear that a number of communities are affected by RBS’s latest round of closure announcements. Many of us will remember the television adverts that boasted about the Royal Bank of Scotland’s commitment to local communities; I ask members to forgive me for feeling slightly bitter about that and wondering whether that breached the trade descriptions act, as the claim was clearly not the case.

August seems to be the designated month for closures. Following Prestonpans, Callander and Stirling, the impact in my local community centres on Alexandria. The proposal there is to use the post office and ATMs. If people want face-to-face consultations, they will need to travel 4 miles to Dumbarton. However, I think that no matter how accessible the bank attempts to make some of its alternative solutions, the reality is that this is about our towns and town centres. I should state for the record that every time that I have been in the Alexandria branch it has been enormously busy.

There is of course the UK Government protocol on branch closures that all of the banks signed up to last year and which commits them to finding suitable alternative provision for individual communities and to putting in place alternative banking services where a branch has closed. I accept that RBS has tried to do that, although what it has done is not adequate.

However, in my view, the principal provision of the protocol—that banks should work with local communities to establish the impact of the branch closure, prior to its closure—has not been met. People have not been consulted in advance; the bank announced the closure of the branch and then said, “We’ll talk to you about it.” In my book, that is not consultation but a fait accompli, and I do not think that it is in the spirit of what was intended in the protocol.

Local people are rightly concerned, and I will share two comments with the chamber. First, someone said:

“I’ve been a customer at the RBS Alexandria branch for over 10 years and I doubt I’ll ever switch to online banking because I don’t even use cashline machines.”

I will introduce them to colleagues in the chamber after the debate for instruction.

Meanwhile, someone else said:

“I’ve banked there since I was a child and if it closes I will be moving to another bank. It’s not always suitable to go to Dumbarton. No consultation with clients, just a letter yesterday saying it was closing and we would be kept informed.”

The proposal is so short-sighted, given the regeneration plans for Alexandria town centre and the £6.5 million that is being pumped into the local high street and Mitchell Way, where the bank branch is situated. I also note that the council has already invested just shy of £1 million to improve signage, including improvements to RBS’s premises.

The one thing that makes me absolutely convinced that this is the wrong thing to do is not just the regeneration plans for the town centre but the fact that RBS’s actions have managed to unite the Labour and Scottish National Party groups on West Dunbartonshire Council. That does not happen too often, but the groups have come together to urge RBS to think again. They are absolutely right to do so.

The Deputy Presiding Officer

Thank you, Ms Baillie. I should say well done—you do not sound too well.

Jackie Baillie

Thank you for your concern, Presiding Officer.

17:27  

Bob Doris (Glasgow Maryhill and Springburn) (SNP)

Like others, I start off by thanking Iain Gray for lodging the motion, making it available for debate and giving members right across Scotland the opportunity to put on record their deep concerns about local RBS closures affecting their constituencies.

Two branches in Glasgow Maryhill and Springburn are set for closure: Possilpark on 9 August and Maryhill on 17 August. I recently met RBS officials to ask them to review and halt that decision, and I will say more about that in a moment. However, I note that the meeting included representatives from Maryhill and Summerston community council; Possilpark community council; Parkhouse community council; Lambhill and district community council; NG Homes, which represented the social housing movement in the constituency; some of our councillors and Patrick Grady MP. I apologise for not mentioning the many more who were involved, but that gives the chamber a sense of the range of the individuals and citizens who are concerned about the closures.

RBS has put on record the low usage numbers, but when we met its officials to discuss the matter and I asked, “Do you know how many people in the area actually have bank accounts?”, they did not have that information, and I do not know whether they knew it before they made their decision. When I then asked whether they knew how many people were connected to the internet, they did not have that information either. They had not done the very basics to identify the impact of the closures, not just on those who currently use RBS in Possilpark and Maryhill, but—and this makes me just as, if not more concerned—on those in areas such as Possilpark who do not have bank accounts in the first place. As RBS is the only bank in town, it is their only hope of accessing mainstream financial services—and now RBS wants to take that away from them.

That approach directly contradicts RBS’s corporate social responsibility policy. In its “RBS Sustainability Report 2015”, RBS talks about people who

“find themselves at risk of financial exclusion: being unable to access the basic financial services they need for day-to-day living”,

and goes on to say:

“One risk is that people can end up borrowing from payday loan companies or doorstep lenders, which pushes them even further into difficulty as they struggle to pay back high interest charges.”

I asked RBS whether it knew the levels of indebtedness in Possilpark and Maryhill and how many people were seeking alternative lending arrangements such as payday loans, but RBS did not have that most basic information. Its decision was based on a business model that paid no regard to the social consequences, and its consultation is about mitigating the worst effects of its decision, as Jackie Baillie said. That is deeply worrying.

Other organisations have contacted me to express concern. Ruchill Credit Union provided a detailed submission in which it explained how the decision will impact on its organisation, but given the time constraints I will not read out what it said. A local church leader told me that the decision will devastate the local community.

I have to say—after all that—that I had a pretty constructive meeting with RBS in Possilpark about trying to save the branches. We thought about alternatives, such as co-location of branches with other organisations. We had met in a brand new building, in which NG Homes is the anchor tenant and which Jobs and Business Glasgow runs. The building has capacity for an RBS branch, if such blue-sky thinking about co-location can be entertained. RBS said that it would consider alternative co-location options in Maryhill and Possilpark, as well as other suggestions that we were keen to make.

However, RBS cannot possibly consider such options by 9 August, in the case of Possilpark, or by 17 August, in the case of Maryhill. We insist on continuity of banking services across the constituency. RBS has pledged to consider giving a stay of execution to the Possilpark and Maryhill branches, on the basis that we are coming up with alternative solutions. The consultation was flawed, but the meeting was positive.

I know that RBS will be listening to this debate. I urge it to give branches, not just in Possilpark and Maryhill but in all our communities, a stay of execution, so that it can go back to the drawing board and think again. I hope that the minister will back that call.

17:31  

Rhoda Grant (Highlands and Islands) (Lab)

I congratulate Iain Gray on securing the debate. I understand that the RBS branch closure is a big problem for his constituents in Prestonpans.

I share Iain Gray’s concern, because RBS is taking similar action throughout the Highlands and Islands, which is causing problems for my constituents. Most recent is its decision to reduce opening hours in the branches in Campbeltown, Bowmore and Scarinish. The two island branches are open only two days a week, and access to an alternative branch involves a ferry journey. People in Campbeltown and Prestonpans might not be on islands, but they too cannot easily access an alternative branch.

Those service reductions by RBS follow last year’s closure of branches in the Highlands and Islands—in Lochinver, Stromness, Invergordon and Lybster. However, the problem is not just to do with RBS; many high street banks, including the Bank of Scotland, are following suit and closing branches in remote areas.

It is simply wrong of the banks to take a wholly business-focused approach and ignore the needs of their customers, who are the very taxpayers who bailed them out not so long ago. It is simply wrong that banks are ignoring their duty to repay their debt of gratitude and are cutting services.

Banks cite internet banking as the reason for the reduction in services, telling us that there is reduced footfall. In my area, that adds insult to injury, because banks are targeting service cuts at places where internet access is patchy at best. Areas that have an unreliable internet service and no branch have no banking services at all.

In addition, elderly people are less likely to bank online and are more vulnerable to fraudulent activity through telephone or email banking scams. The needs of the most vulnerable people in our communities are being ignored. If we are to help to protect such people, we need to ensure that they have access to information and services at local branches of their banks.

We perhaps also need to think about how we support credit unions to open branches in small communities, to enable elderly people, people who do not use internet banking and people who do not have bank accounts to access financial services. It seems to me that banks have altogether given up that role in the community and we need to look at alternative provision.

Banks have a duty to the customers who bailed them out. It is time for Government to intervene on behalf of customers to try to stop the closures.

17:34  

Neil Findlay (Lothian) (Lab)

The Royal Bank of Scotland, like the banking sector in general, is going through a mass evacuation in its branch network. Across the country, a cull of branches appears to be going on, and that cull is clear evidence of a complete failure of planning and absence of managerial competence.

On the one hand, we have a marketing strategy that is aimed at moving people away from branches and on to telephone and internet banking because, as well as it being promoted as convenient for the customer, it also cuts costs. On the other hand, we have a policy that, when it was launched, stated:

“We pledge to stay open for business if we are the last bank in town”.

Since that policy was announced, we have witnessed bank after bank close—600 since 2010—and many of them were the last bank in town.

How on earth can senior banking executives have got it so spectacularly wrong? Is it not obvious that, if a company drives a policy that leads people away from banking in person towards using and relying on technology, it will inevitably run down the branch network? To promote a “last bank in town” policy at the same time was either complete incompetence or a policy that deliberately sought to mislead customers and the public. RBS has never declared which of those is the case.

Many branches have closed in my region, such as at Fauldhouse, Armadale, South Gyle, Tollcross, the royal infirmary, North Bridge, Balerno, Goldenacre and Newtongrange, and more closures are planned at West Calder, Broxburn, Fairmilehead, Colinton and Heriot-Watt. Indeed, there may be more.

This is a bank that we control, with a 73 per cent stake. As a shareholder in the bank, I do not give my authority for the closure of branches; I hope that none of us does. We are indeed the shareholders. Maybe the Conservative member who is here in the chamber could have a word with the chancellor, because he has a bit of influence over what goes on in this situation.

This is a bank that we had to bail out and a bank where successive corporate failure has been rewarded, with £17.4 million being awarded in shares to 10 of the senior management team. The chief executive is on a salary of £3.8 million and £2.6 million-worth of shares, and all the time banking staff are lucky to get 1 per cent increases. That reinforces the view that there is one law for a certain group of people and another law for the rest.

The closure programme is just another example of RBS’s failings. There has been no discussion with loyal customers and no consultation—just corporate diktat from the boardroom.

RBS could do one thing to try to get its way out of things, or to gain some credibility with communities. Of course, it could stop the closures, or at least some of them, but it could also think about how it could give something back to the communities that it has profited from over the years. Where there is a desire for it and where it is practical to do so, it could transfer the asset—the building—to the community. That would at least do something to reward those loyal communities. I have asked for that in my area, and RBS has refused. Even though the bank closed about 18 months ago, the building still lies vacant. That is just another example of poor management by RBS. Members of the public deserve much better.

Bob Doris said that RBS did not have basic information such as the number of people with bank accounts or the number with internet access. It does not have that information because it does not care. It does not want to have it. It has a programme of closure and it is going to ram it through come what may. That is the reality.

I have requested a similar meeting to the one that Bob Doris had. Unfortunately, I am still waiting on a reply.

The Deputy Presiding Officer

I call Paul Wheelhouse to wind up the debate.

17:39  

The Minister for Business, Innovation and Energy (Paul Wheelhouse)

I thank lain Gray for lodging his motion. I am not sure whether I have congratulated Linda Fabiani on her appointment as Deputy Presiding Officer since we returned to Parliament, but I do so now.

The Parliament has previously debated the closure of bank branches, which is an extremely important issue. I appreciate that members have raised genuine concerns as the Royal Bank of Scotland and other banks continue to close branches, not only in Mr Gray’s East Lothian constituency but, as we have heard, across Scotland. I have made a rough tally—I apologise, as it may not be accurate. In the current year, nine Clydesdale Bank branches, 13 Bank of Scotland branches, eight TSB branches and 13 RBS branches have closed. That gives a sense of the scale of the change that is happening at the local level.

I am aware of a number of closures in East Lothian and the Scottish Borders, including the loss of the historic branch in my own village of Ayton, which was hard felt locally. Concerns have been raised again today about the impact of branch closures on our local communities, and members have made very important points. Many members highlighted branches that appeared to be busy on recent visits. Sometimes it is difficult for us to understand the business driver for branch closures. I will come to that later.

Banks have an essential role in Scottish society, as members across the chamber have recognised. They are particularly important to our local economies. We all rely on banks in order to conduct our daily lives. The Scottish Government is absolutely clear that customers must be at the heart of what banks do and the decisions that they make. Iain Gray made the important point that the RBS branch in Prestonpans was the last one in the town. That is particularly significant to that community, but it has also been the experience in other places around the country.

RBS’s branch closure decisions will have an effect on everyone in the local community, not least the staff employed at those branches—let us not forget them. The staff have, often for many years, provided a much-valued service to their customers. Iain Gray hit on the point that the branch in Prestonpans is very much valued. I am not at liberty to give out details, but I understand that there are no plans for compulsory redundancies, which at least is something positive to take from the discussion.

As Iain Gray identified, there are commercial drivers, and we all accept that the banks must address their long-term financial sustainability. RBS is undertaking a restructuring process to bring the bank back into profitability and, ultimately, to take it out of public ownership. RBS has made it clear that, to do that, cost savings and, unfortunately, difficult decisions must be made. We understand that.

However, it is clear from today’s debate and from previous debates that members do not feel that RBS gives sufficient weight to the views of customers and the wider community when it is deciding whether to close a branch. As Jackie Baillie highlighted, there are concerns about engagement with local communities such as the community in Alexandria, which can ill-afford to lose vital employment. The closure of a branch should be a last resort and should occur only where business and personal customers will still have ready access to the banking services that they need. Rhoda Grant gave an important perspective when she set out in some detail how closures would impact on rural areas.

When a decision is made to close a branch, there is a three-month period between the closure announcement and the closure itself. That timescale was agreed by the banks, consumer bodies and the UK Government, and is set out in a branch closure protocol. RBS and other banks are clear that the 12-week period is a notice period, not a consultation period, but it can and should be used for genuine engagement with customers. Alternative arrangements should be clearly explained and any particular difficulties resolved where possible. As members have highlighted, there appears to be no opportunity for customers and communities to influence a bank’s decision. When a closure is announced, the decision has already been made. It is, as Jackie Baillie put it, a fait accompli, which is a matter of great regret to us all.

As Mr Gray highlighted in his motion, there is no doubt that many bank customers are increasingly using alternative methods to access banking services. For example, RBS reports that branch transactions have declined by 40 per cent since 2010. However, although online and mobile transactions have grown by more than 400 per cent in the same period, Bruce Crawford talked effectively about the impact on older customers of our overreliance on looking at online banking as the solution to branch closures. RBS notes that only 9 per cent of its total transactions are now branch based, which is down from 25 per cent in 2010. However, people often go into a branch because they want face-to-face contact, as they may have a more complex issue that needs to be resolved—they may be seeking advice and support at a time of distress.

As internet and mobile banking continues to grow in popularity, the impact on the number of customers who actively use a physical local branch is inevitable. Such solutions do not and cannot suit all customers—not everyone has easy access to the internet or to mobile banking. Face-to-face banking is still considered to be essential by many customers, and a physical branch presence will continue to be a requirement for many years to come. Banks must therefore consider access to suitable alternative service provision in any decisions that they make about the delivery of branch services.

As members have highlighted, disabled and elderly customers will be disproportionately affected.

Neil Findlay

Does the minister agree that it is absurd to pursue a policy of moving people on to telephone and internet banking at the same time as promoting the last bank in town policy? That, to me, is crazy.

Paul Wheelhouse

It is not for me to criticise banks’ decisions about how they go about their business and whether they promote telephone or online banking. However, I agree that it is important for banks to understand the impact of a branch closure on customers such as those who cannot take advantage of telephone banking because they do not have access to a telephone or those who do not have access to the internet. It is essential to take on board the impact on someone who is disadvantaged in a digital sense. I listened with great attention to what Bob Doris said about that.

Bob Doris rose—

Paul Wheelhouse

As he is asking, I will give way to him.

Bob Doris

The minister talked about a shift away from high street banking. In areas such as Possilpark that suffer from deprivation, people have never made the shift from being financially excluded to being financially included. If the bricks and mortar bank is no longer on the high street, the area is being written off for generations to come. Should RBS not think about that before it decides to close a branch?

Paul Wheelhouse

That is an important point, to which I was about to turn. In his speech, Mr Doris made some important points about his constituency and I commend him for the action that he has taken in engaging with RBS to discuss the impact on his local community. He is quite right that we face a big challenge in Scotland in relation to access to banking services for many people, but the situation is obviously not helped if the only local branch that people can access physically is being closed.

The banks might also be missing an opportunity. They might gain customers who might not be high-net-worth individuals, but who could be of value to the business in future. I regret that that does not appear to have played more of a part in the decision-making process.

Bruce Crawford made an important point about businesses that generate cash—I apologise if other members have mentioned them as well. Whether we are talking about the local farmer or a hospitality business—particularly in areas that have many tourism businesses, such as Mr Crawford’s constituency—businesses that take a lot of cash every day need somewhere to safely deposit that cash.

RBS maintains that it is continuing to invest in its mobile branches. They provide services in many areas where local branches have closed and visit communities that previously had no branch presence. However, that is very much a supply-led approach that is not necessarily as flexible for consumers as a physical branch would be: customers can choose when they decide to appear at the branch but the van service might not be available to them at that time.

I welcome the use of post offices as an alternative location for banking transactions, although the post office network has also contracted in recent years, and major changes mean that it is not necessarily in a particularly stable place either.

There are other providers of financial services in Scotland. The Scottish Government has long recognised the valuable contribution of credit unions.

Bob Doris

Will the minister give way?

Paul Wheelhouse

I was just going to touch on credit unions but I will give way.

Bob Doris

The minister mentioned the post office as an alternative, but people cannot open a bank account, set up or alter a direct debit or standing order, or get loans advice or mortgage advice at the post office. Post offices just do not cut it.

The Deputy Presiding Officer

Minister, can you wind up fairly quickly, please?

Paul Wheelhouse

I will, Presiding Officer.

I do not want to criticise the post office network; I merely make the point that, as a fallback and in the absence of a local bank, at least the post office improves access and allows people to obtain funds. However, I take on board Mr Doris’s points about the services that it provides.

There are other service providers, including credit unions, that tackle financial exclusion of the kind that Mr Doris mentioned, and I was pleased to hear him refer to credit unions in his speech. Credit unions provide vital financial services to a wide range of customers. As I said, I have been very struck by Mr Doris’s intervention for his local branch and I wish him success with the campaign.

I appreciate members’ concerns about the impacts of the closures on our communities across the country, whether they are in the Borders, as Rachael Hamilton said, or in East Lothian, as Mr Gray said. In my new ministerial role, I will meet representatives from the banks regularly and I undertake to raise the issue when I have the opportunity to do so to ensure that the banks are aware of the strength of feeling across the chamber today.

As Bruce Crawford, Iain Gray and Neil Findlay pointed out, RBS is 71 per cent publicly owned, and I urge it to listen to and work with local communities and their representatives. It must ensure that banking services remain readily accessible to all and meet the needs of Scottish communities, and must work to ensure that the closure of bank branches in remote and vulnerable communities does not harm the common good. I hope that a positive outcome can come from Mr Doris’s discussions with RBS regarding his constituency and—if Mr Findlay is given an appointment—that there are opportunities to look at alternative models, which Government will be supportive of where it can be.

Thank you very much for your patience, Presiding Officer.

The Deputy Presiding Officer

Thank you, minister.

Meeting closed at 17:50.