Supplementary memorandum submitted by
Services Against Financial Exclusion (SAFE)
I wanted to write to you to follow up on a few
points that were raised during the course of the morning.
1. ACCESS TO
BANKING
1.1 POCA
The possible closure of the Post Office Card
Account concerns us. This is because they are a uniquely simple,
accessible product enabling unbanked people to receive benefits
by Direct Payment. As such, its withdrawal from the market place
could mean the exclusion of those who are:
— unwilling or unable to use a more
fully featured account
— unable to overcome barriers to opening
an account, notably ID/AV and application procedures
As well as this direct concern, the withdrawal
of POCA also represents a failure to grasp the possibility of
graduating people through such a basic service towards more fully
featured accounts. Related to this, we consider the possibility
of expanding features of the POCA to have real potential provided
it continues to be genuinely debt free (eg no charges for failed
transactions).
1.2 Basic bank accounts
We found the Committee's thinking about basic
bank accounts very interesting. As discussed here at Toynbee Hall,
we think problems around basic bank accounts are less about the
products or top level commitment within banks, and much more about
patchy implementation at a local level.
Rather than see recommendations for structural
change, we believe that a combination of localised intermediaries
from community based organisations, coupled with ongoing consultation
and assessment around core elements of the client experience can
make a real difference.
We would be interested in taking this discussion
further, to talk about further issues such as streamlining information,
marketing and accessibility.
2. NETWORKS
I wanted to emphasise the importance that we
place on developing networks of best practice to be able to achieve
the highest level of potential change in the area of financial
inclusion. To this end, we are proud of the Financial Inclusion
Forum, which to date has 250 members and is dedicated to providing
support to practitioners, policy makers, financial service providers
and funders. As the first UK-wide network of projects and associations
involved in financial inclusion work we seek to be a facilitator
for change in the sector nationally.
3. A JOINED UP
APPROACH TO
FUNDING
The question was raised about how Government
sources of funding work in the voluntary sector. Through our recent
experience with funding streams from the Department for Work and
Pensions and the Department for Education and Skills—we
feel strongly that this statutory funding often works in isolation,
without initiating a joined up approach to delivering financial
inclusion.
For example, through its Payment Modernisation
Programme DWP invested in the creation within Toynbee Hall of
a team of experts working across London with unbanked, low-income
and often hard to reach clients. This work was high-quality, and
directly relevant to fulfilling government objectives around financial
inclusion. However, in the re-contracting process, priority was
given to narrow measures of cost effectiveness within a contracting
process, rather than the value to stated policy goals. This resource
has now been dismantled.
Toynbee Hall generates real value for government
through these extended networks. We are leading the Financial
Inclusion for London partnership in its bid to the DTI's Fact
to Face Debt Advice Project. This work will aim to reach the financially
excluded in part by reviving the dormant structures which supported
the DWP work.
We are keen for government to capitalise on
these existing structures in its efforts to tackle financial exclusion.
We hope that Toynbee Hall can continue to engage
in creative dialogue with the Treasury Select Committee. We feel
passionately about the work that we do here at Toynbee Hall where
we can test actions at local level that have the potential to
become national solutions. We would be delighted to share our
networks and practical experiences with you wherever appropriate.
February 2006
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