People’s Bank – by Lord Mandy

2 12 2009

If it was anyone but the Dark Lord suggesting this, I would nod in agreement but seeing as Mangledbum’s sticky fingers are stuck knuckle-deep into this pie, I shiver to think the angle being played here.

Post offices to turn into ‘People’s Bank’ to rival high street giants in bid to save network

Daily Mail, 2nd December 2009

Post offices will become fully functioning banks to rival the high street giants under a rescue plan to be unveiled today by Lord Mandelson.

The radical proposal will see the embattled network transformed into a People’s Bank offering every sort of account from current to children’s savings.

Although post offices already offer limited banking products through a tie-up with the Bank of Ireland, the range will be hugely expanded.

The recent loss of Government contracts, such as the television licence, triggered a warning from the National Federation of Subpostmasters (NFSP) that the entire network could collapse.

Now the Business Secretary hopes millions of people who have not visited, or rarely visit, their post office will be encouraged to return. Lord Mandelson said: ‘Growing financial services at the Post Office will help secure the future of the network.

‘At a time when some banks and financial services companies are seeking to reduce face-toface contact with customers, the Post Office stands out.

‘It offers a trusted brand and has more branches than the high street banks combined.’

A 12-week public consultation on the proposals begins today. The biggest launch will be a current account, which is likely to offer low charges – unlike many high street rivals which sting customers with heavy penalties.

There will also be a children’s savings account, designed to encourage young people to get into the habit of using their local post office.

The Post Office is also planning to improve its range of mortgages to become a ‘more significant’ player in the market.

A ‘weekly budgeting’ account will be aimed at poorer households and will allow them to ‘ring-fence’ a proportion of their income each week, which can then be used to pay bills by monthly direct debits.

Other proposals include a business bank account, a closer link with credit unions and also moves to allow those with accounts at other banks to access them at their post office.

The consultation was welcomed by the NFSP, but General Secretary George Thomson raised concerns at the Government’s ‘timid approach’.

He said: ‘Talk of the Government handing over parts of Northern Rock and the other nationalised banks to the likes of Tesco and Virgin, while threatening to leave post offices with the crumbs, will do nothing to restore the public’s trust in the banking sector, and nothing to return local banking facilities to the heart of communities.’

The People’s Bank plan – first trailed by Prime Minister Gordon Brown in September – follows a devastating two-year closure programme which has seen 2,432 post offices shut down, leaving only 11,500.

At its peak in the Sixties, there were 25,000 branches.

But the network still boasts more outlets than the 10,000 branches of major high street banks, according to figures from the British Bankers’ Association.

All this talk of a “people’s bank” when in fact we own quite a few already.  And if Mandy gets his way, I’m sure a few billionaires will be rubbing their hands with glee at the fortune to be made ‘advising’ the Gov’t on such grand plans.  As always, the rich get rich and the poor get screwed.

And doncha think “People’s Bank” sounds just a tad too much Communistic?

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