Why we aren’t banking on change any day soon

WHEN the blessed Maggie and her acolytes introduced the free market and the concept of “choice” into our lives, it was hailed as a virtuous revolution in which we would all become share-owning mini-investors and benefit from a wider selection of cheaper services.

What a success that was! Take the buses – well, no, you probably don’t. If you live in our neck of the woods, unless you include the excellent Berry’s coach to London, which is affordable and reliable, most rural communities count themselves lucky if they have one bus a week.

But it is a good example of how poorly the free market operated. In the heady first few months, new independent bus companies popped up all over, from Aberdeen to Zennor, but it was a very short time until most of them either went out of business or, more likely, were subsumed into a larger local operator, which in turn was bought up by a bigger regional and that in due course was cannibalised into one national company. First past the post, as it were. Jobs were lost, services were cut, and without grants from county councils for social and community needs, most parts of the West Country would be bus-less.

A friend says she believes that the only way you can benefit from the “choice” now open to us in selecting our utility providers, water company or phone company, is if you are out of work, either through unemployment or retirement (in which case you may have the time but surely won’t have the money to burn sitting on telephones listening to digitalised Vivaldi ad nauseam).

The current mantra is that we need more choice among High Street banks. In some ways, this would be a good thing. Nobody can have confidence in the “culture” (abuse of a good word) of the banking industry, with its legacy of mis-selling protection plans, pushing naive borrowers into debt, driving small firms out of business and rewarding obscene bonuses to employees guilty of these offences in a target-driven working environment.

However, not all banks are bad. Not all of us want to do internet banking. Not all bank staff are greedy and reckless of the effect of their behaviour on ordinary customers.

We are among the lucky customers who have a local branch of our bank (one of the four big ones, but less tarnished by gross misbehaviour than some). We have staff who are friendly, helpful, efficient, and always ready to give good advice or find answers if they don’t know them.

They go the extra mile in a way that you used to expect from your local bank back in the not-so-Dark Ages, when every town and village had a choice of high street banks and there were seven or eight different banking companies. The choice of banks has shrunk in the past few decades, and many communities are without a retail bank at all. A friend in Boscombe has to travel miles through congested roads and search for a space in an expensive car park to get to her bank. I wouldn’t blame her if she went over to internet banking.

But our town, where we have branches of three major banks, would be infinitely the poorer in terms of good customer service if our bank chose to close its local branch. So we are ready, at a moment’s notice, should that fateful day come, to parade with banners and fight for this excellent personal service to continue.

What then do we make of proposals for “challenger” banks to increase choice? Ed Milliband wants to break the dominance of the established banks by creating new competitors but experts are gloomy over the prospects because they predict that new entrants will not be able to afford to “buy” enough accounts.

You may be offered £100 to switch your account from, say, NatWest to a new bank, but how much will it cost you, in time, aggravation and even cash, to switch all your outgoings and standing orders, and if you are a small business, to change all the print which includes your bank details.

One influential critic of the proposals said that they would not create genuine competition. They would, he said, be “the same culprits with a new logo.”

It is said that we are less likely to change banks than we are to move house or get divorced. All are expensive, hard on your nerves and not something you do willingly. Banking is the only one over which you probably really have control.

Surely what we all want is not choice for the sake of it, but better service. And in rural areas, where our services are constantly undermined and withdrawn, we want to hang on to what we have.

We don’t want to be challenged. We want a service we can bank on.

Fanny Charles