New coalition launches campaign for ‘Post Bank’
17th March 2009
A comprehensive proposal for a new ‘Post Bank’ to run as part of
the post office network is launched today (Tuesday 17 March) by a
new coalition of trade unions, a business organisation, pensioner
and pressure groups and charities.
The proposal for the Post Bank will be formally launched at a
parliamentary reception hosted by Jon Cruddas MP this afternoon,
with cross-party speakers including Pat McFadden, minister for
employment and post offices, Vince Cable, deputy ;eader of the
Liberal Democrats, and Phillip Blond, director of the Progressive
Conservatism project at Demos.
The model for a Post Bank proposed by the coalition would:
- provide more financial services to people and businesses
currently not served by high street lenders
- strengthen the role of post offices and the post office network
- making it more viable, creating new job opportunities, and
securing its role for the future
- ensure a stable source of finance in the heart of communities,
particularly for the three million people still not using banks and
the many small businesses looking for alternative sources of
finance
- link the productive economy with finance through a return to
the form of ‘relationship banking’ abandoned by our biggest
banks
The Post Office and its network of 11,500 branches (almost twice
the number of the major high street banks combined) is a unique
national resource which communities, businesses and individuals
around the UK depend on. The Post Bank coalition believes there is
a unique opportunity to answer both concerns around secure and
equitable finance and the future of the post office network by
setting up a Post Bank.
Evidence from the coalition members demonstrates the clear need
for a local banking infrastructure through a Post Bank:
- Around three million people are still denied access to basic
finance in the UK, including the most disadvantaged, pensioners and
those in very remote rural areas
- The dynamic small businesses that pound for pound create more
jobs than big business, are experiencing an increase in the cost of
new credit through the high street banks and many are looking for
alternative sources of finance to help them through the
recession
- Two out of five small firms think that a Post Bank built on the
post office network is a good idea and would consider banking with
it
The Post Bank - which would be established with government
funding, supported for example, by the issue of local bonds, would
offer a variety of finance services through post office branches
and online - would address these key concerns. Instead of using
government money to service existing bad debt, the Post Bank would
provide stable finance where it is needed most, in the heart of our
local economies.
The government must now seize this opportunity and build on the
foundations of the post office network to create a Post Bank that
works for the people and businesses of the UK.
Billy Hayes, CWU general secretary, said: “The Post Bank is the
right proposal at the right time politically and industrially. It
answers the needs of the financially excluded and will appeal to
many in this time of economic uncertainty. The Post bank will be a
true people’s bank meeting the needs of society and business alike
and will bring crucial security to the post office network. The
government must move swiftly to endorse this timely proposal.”
John Wright, national chairman of the Federation of Small
Businesses, said: “Small businesses are completely reliant on the
post office network with 80 per cent passing their letters and
parcels through the Post Office and 47 per cent visiting a post
office a couple of times each week. Most sub post offices are run
like small businesses, and keeping the network alive by
establishing Post Bank would not only retain jobs but could also,
we estimate, create 11,000 new jobs.”
Lindsay Mackie, campaign co-ordinator at nef (the new economics
foundation) said: “The Post Bank Coalition proves that the idea of
a trusted, fair and accessible bank based on the valued post office
network has wide support across British society. We think that our
proposal is an example of the radical re-thinking of our financial
institutions that the government should be working on urgently. In
fact, the failure to do so would leave local communities, local
economies and the thousands of small businesses that are the
lifeblood of UK plc, very vulnerable”
Paul Reuter, Unite national officer, said: "Unite welcomes the
valuable work of the Post Bank Coalition. There is clearly an
appetite for a banking network that would reverse the trend of
exclusion of local communities and improve services to small
businesses, whilst at the same time supporting and maintaining the
post office network. The experience of other established Post Banks
in Europe are successful examples. The Post Bank - at the People's
post pffice offers an opportunity for social inclusion, security
and innovation in the banking sector which government must
endorse."
Frank Cooper, president, National Pensioners Convention, said:
"The post office network provides an everyday lifeline to millions
of older people, many of whom rely on the services it offers and
its valued place in local communities. Recently pensioners have
lost faith in the financial sector and the launch of a new,
People's Bank at the post office will offer some much needed
security to those who feel their money is currently under
threat."
Tim Holmes, PIRC, said: “The post office has long provided the
public with a face-to-face means of investing their money securely,
in government-backed pension funds and bonds. It also offers the
perfect means of leveraging investment for a new, renewable and
sustainable energy infrastructure at this critical time. PIRC fully
supports the goals of the Post Bank Coalition, which will be
essential in providing local communities and small businesses with
the financial security they so urgently require."
ENDS
For more information, please contact:
NOTES TO EDITORS:
- The Post Bank coalition is made up of the Communication Workers
Union, Federation of Small Businesses, National Pensioners
Convention, new economics foundation, public interest research
council, Unite the union, with other observer and supporting
organisations.
- In a recent survey of around 5,000 small businesses, the
Federation of Small Businesses found that two out of five small
firms thought a Post Bank built on the Post Office Network was a
good idea and they would consider banking with it.
- In a recent public opinion telephone survey of 1,000 people,
the CWU found that the post office is a trusted institution with
93% saying that they trusted it (69% really trusting it). This
compares to only 54% trusting banks.
- Around three million people do not have access to basic banking
in the UK, and banking services are not taken up by many of the
most disadvantaged, the elderly and those in very remote rural
areas.
- The value of the Post Office Network: Research by nef (the new
economics foundation) has quantified the value of post offices to
local economies and small businesses. nef research showed
that:
-
- For every £10 earned in income, the post office generates
£16.20 for its local economy - including £6.20 in direct spending
on local goods and services.
- In addition, nef’s analysis of post offices in the Manchester
area revealed that each post office saves small businesses in their
direct vicinity in the region of £270,000 each year.
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