1 December 2023

Rachel Reeves recently announced a range of financial services and retail banking policies if the Labour Party wins the next General Election, writes Alice Perry, Associate Director – UK Public Affairs.

Rachel Reeves, Jonathan Reynolds and Tulip Siddiq visited a banking hub with LINK and the Cash Action Group today, announcing a plan to open 350 banking hubs in the UK. Banking hubs are shared spaces where communities can access everyday personal and business banking services.

Access to cash has long been a campaign issue for consumer rights groups and is shaping up to be a mainstream political issue, connecting to broader themes of hope vs decline that will frame the debate during the General Election.

At Labour’s 2023 Annual Conference, delegates voted through a detailed policy outlining Labour’s aspirations should they come to power. The document included a commitment to protect vital in-person banking services, guarantee free access to cash and monitor the use and acceptance of cash, while supporting innovation in payment and banking systems. It also included a commitment to work with the Post Office on developing new products and services, such as banking hubs, that will help reinvigorate the high street.

These measures were strongly supported by Labour’s affiliated Trade Unions. The Trade Unions and Labour’s sister party The Co-operative Party regularly run campaigns on access to cash and financial inclusion. This topic is seen as a priority for their members.

I was a member of Labour’s National Policy Forum for over 10 years, the body formally responsible for policy development. Labour’s policy discussions around financial services tend to focus on retail FS and particularly policies connected to access to cash, financial inclusion and consumer protections. These are the issues that are seen as mattering most to voters and the Party’s social justice values. Bank branch closures, “cash machine deserts” and the general decline of the British high street are routinely raised with MPs and local Councillors. (In contrast, voters don’t tend to raise Solvency II or the Wholesale Markets Review with Labour on the doorstep).

The narrative of the decline of the high street came up regularly during canvassing and in public meetings when I was a Councillor and on Labour’s National Executive Committee. People would complain that banks and hardware shops were closing and being replaced with betting shops, payday lenders and boarded-up windows. This is a concern that resonates with voters across the country, and particularly in the so called “left behind” communities that voted to leave the EU. Many of these voters live in constituencies Labour needs to win back in order to secure a majority at the General Election.

Labour (and Reform) will be looking to connect with these voters’ concerns. Labour needs to persuade voters that they can reverse what they call the UK’s path of “managed decline”, regenerating high streets and communities. Labour’s banking hubs plan plays well with the kind of voters they are targeting in these marginal constituencies. It is worth noting that the policy announcement was covered widely in local and regional papers, highlighting what it means for their towns and communities, and giving an opportunity for some of Labour’s prospective parliamentary candidates to raise their profile as the General Election gets ever closer.

To find out more about Labour’s approach to policy development and understanding Keir Starmer’s Labour, please get in touch.

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