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Labour vows to save East Anglia’s rural banks

PUBLISHED: 20:34 25 September 2018

Shadow business, energy and industrial strategy secretary Rebecca Long-Bailey addresses the Labour Party's annual conference at the Arena and Convention Centre (ACC), in Liverpool. Picture: Stefan Rousseau/PA Wire

Shadow business, energy and industrial strategy secretary Rebecca Long-Bailey addresses the Labour Party's annual conference at the Arena and Convention Centre (ACC), in Liverpool. Picture: Stefan Rousseau/PA Wire

Labour is planning a radical overhaul in banking rules to stop branches closing in rural East Anglia.

Lloyds Bank in Watton is the latest rural bank to announce that it will be closing. Picture: Marc BettsLloyds Bank in Watton is the latest rural bank to announce that it will be closing. Picture: Marc Betts

Speaking to this paper at Labour’s annual conference in Liverpool shadow business secretary Rebecca Long-Bailey said she would grant new powers that would force banking giants to keep branches open.

She added that the party was worried about the erosion of banking facilities for people in rural communities in the East. The boom in internet banking has led to many branches being closed outside major towns and cities.

She said: “We would essentially beef up the powers of the Financial Conduct Authority so if a bank wanted to close a branch it would have to satisfy certain criteria. One of those would be making sure they don’t degrade local financial infrastructure.

“So, if they were the only bank in an area, for example, that bank closure would mean no banking services. People shouldn’t have to drive miles and miles just to get to a bank. If you are a shop owner trying to pay your takings in every week it is dangerous, or an elderly couple trying to take money out at the bank - it is not feasible.

“So the FCA would then take into account the services that bank provided. The bank would also have to consult its own customers. Ultimately the FCA would have the power to veto the closure if it was not in the interests of the local community.”

Ms Long Bailey said she also believes that keeping branches open will stop an increase in pay-day lenders moving into rural areas: “What I am seeing is the closure of banks on our high streets but also an increase in pay-day lenders. The fear is that if government doesn’t take action on this, the first point of call for people financially would be to go to these lenders and get a loan instead of getting financial advice from the bank.”

She also announced a similar plan to halt the closures of post offices in small towns and villages.

“We will end the franchising out of crown post offices,” she added. “There will be no more ability for those to be franchised out or privatised in the future.”

Labour’s policy on banks and post offices is part of a wider plan to protect high streets in the face of tough competition from online retailers. Among the proposals is a plan to offer free wifi in town and city centres and Ms Long-Bailey said she hoped villages could also take advantage.

“What we have said is high streets and town centres at the moment,” she said. “Essentially the process is that a wifi provider would pay a fee to put its infrastructure on local land. Then in return for providing that free wifi they can use it for their own commercial purposes – perhaps to provide mobile phone services for example. It is a win-win situation.

“We would encourage providers to do this but obviously we would bear in mind the views of the community. We would not want to be putting mobile phone masts in areas that are not appropriate. All those factors would be considered by the local authority anyway.”

Talking about the challenges facing struggling high streets in towns like Ipswich and Great Yarmouth, she said: “Our shopping habits are changing, but that doesn’t mean all our shops need to close and we buy everything online.

“But it does require us to look at the ways we use our high streets. There have been suggestions that high streets should be community spaces, engaging with the café culture and the night-time economy which would ensure that the community could place anchors on those high streets to attract people in.

“This is about having a fresh approach and every high street will be different. There is not a one-size-fits-all solution that will solve all the problems.”

She added that the party were investigating whether there would be incentives offered to encourage independent shops to open in town centres and has vowed an overhaul of the “unfair” business rates system which she claims punishes smaller business.

CONFERENCE WHISPERS

This gathering of the comrades has been something akin to family Christmas after the dinner is eaten and the Baileys is beginning to kick in - bitchy and stressful.

To be fair to Labour though I expect even more spats next week when the Conservatives arrive in Birmingham.

Labour’s enfant terrible this week has come in the shape of the former director of public prosecution Sir Keir Starmer.

The Brexit secretary’s views on leaving the European Union differ somewhat from his leader’s and shadow chancellor’s – and it seems he is starting to get fed up.

The approved version of his speech – which will have been heavily scrutinised by the boss – was fairly tame. And crucially it did not mention the row that has gripped this gathering: Will Labour ever back a second referendum which would give the option to stay in the EU?

So imagine the shock when he said from the podium: “No-one is ruling out Remain.” The Labour leavers in the conference hall went pale and according to one leaky source Jeremy Corbyn’s fearsome fixer Seumas Milne was immediately on the warpath.

One Labour MP said: “Many soft Brexit leaning MPs are furious. He’s just lucky he didn’t have Seumas on autocue control.”

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