What's trickling down on my back

DiggerUK

In the 1980's the government ended the right to demand our wages in 'coin of the realm'.
The legislation that was repealed was 'The Truck Acts' which was brought in to end the scandal of the company stores, were workers had to buy overpriced goods from the company shop with tokens issued as part of their wages.

The promise made at the time, was that we would not have to pay to get our pay, and that free current accounts would be protected.

Surely the government would not lie to us.
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PasturesNew

I used to pay £0.27 per cheque at the Midland Bank in the late 70s.

I thought bankers gave us free banking so they could get their hands on our lolly sitting in current accounts.... and also paid for by those who went overdrawn.

Generali

DiggerUK wrote: »

In the 1980's the government ended the right to demand our wages in 'coin of the realm'.
The legislation that was repealed was 'The Truck Acts' which was brought in to end the scandal of the company stores, were workers had to buy overpriced goods from the company shop with tokens issued as part of their wages.

The promise made at the time, was that we would not have to pay to get our pay, and that free current accounts would be protected.

Surely the government would not lie to us.
..._

If you have your wages paid into a savings account then it's very unlikely that you will pay any fees or charges.

If you want a current account with assorted ways of paying people and large, expensive IT and branch infrastructure behind it then that has to be paid somehow.

The current model of having (poor) people that go overdrawn by a few pennies pay for your free banking by being hit with excessive and illegal fees has been rightly attacked by this website as well as other media outlets. That doesn't mean that current accounts are going to go from being 'free' to 'not free', it simply means that all users of current accounts will pay in future which seems much fairer to me.

Here is the link to the Parliamentary debate regarding the repeal of the Truck Acts:

http://hansard.millbanksystems.com/commons/1986/may/14/payment-in-cash#S6CV0097P0_19860514_HOC_435

There is no mention in there of 'protecting free current accounts', in fact the point is made that cashing a cheque in the post office on the weekend costs 50p!

Either your memory is faulty or you are making things up.

michaels

Do you have any stats to back up the 'poor'? I would guess poor people are more likely to have no overdraft basic bank accounts and it is lazy people/people who are unable to defer gratification who use expensive overdrafts for short term borrowing.

Banks also obviously make money on receiving funds for free and lending them at rates of minimum 6% for personal loans and often 30% for credit cards.

There are only a few big players in the current account market in an industry where economies of scale obviously present massive barriers to entry. I am sure they would be able to manipulate prices to make excessive profits if they charged everyone.

Remind me again who you work for Mr G?!

Generali wrote: »

...

The current model of having (poor) people that go overdrawn

Generali

michaels wrote: »

Do you have any stats to back up the 'poor'? I would guess poor people are more likely to have no overdraft basic bank accounts and it is lazy people/people who are unable to defer gratification who use expensive overdrafts for short term borrowing.

Banks also obviously make money on receiving funds for free and lending them at rates of minimum 6% for personal loans and often 30% for credit cards.

There are only a few big players in the current account market in an industry where economies of scale obviously present massive barriers to entry. I am sure they would be able to manipulate prices to make excessive profits if they charged everyone.

Remind me again who you work for Mr G?!

For a start the BCSB (an industry body) reckon the majority of the costs of illegal unauthorized overdraft fees fall on the poor:

http://news.bbc.co.uk/2/hi/business/4940250.stm

"Disturbingly, the charges fall hardest on people on low incomes, such as students, who can least afford them," Seymour Fortescue, chief executive of the BSCB told BBC News.

To return to the OP, there was never any promise that current accounts would remain 'free' when the Truck Acts were repealed as can be seen from the Hansard extract.

Without overdraft charges, current account provision runs at a huge loss. The main reasons for selling current accounts are to try to cross sell profitable products (such as credit cards and PPI) and to collect illegal overdraft fees.

DiggerUK

Generali wrote: »

......
To return to the OP, there was never any promise that current accounts would remain 'free' when the Truck Acts were repealed as can be seen from the Hansard extract. ......

At the time of the repeal, current accounts were free anyway. The charges referred to for cheques was a stamp duty tax imposed by the government, not the banks. If you cashed cheques at a bank other than your own there was a charge.

All debates had mention of there being no penalties imposed for the changes, now there is a proposal that bank accounts have automatic charges, at a time when banks have revealed to the most ignorant what their morals are.

What these proposals mean, is that we would have no choice other than having to deal through banking monopolies in order to get our pay, and having to pay for the privilege. And you defend that???
Payday loan scandals is one thing, payday charges is a danger to us all.
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oldvicar

PasturesNew wrote: »

I used to pay £0.27 per cheque at the Midland Bank in the late 70s.

Gosh, that was a lot !

IIRC, in ye oldene days a book of 30 cheques used to cost 2/6 (i.e. 1d each) - that might have been the stamp duty Digger refers to?

Then in the Yuppie era (early/mid eighties) when they were generally free, Ms loadsamonies could opt to pay NatWest 25p for cheques with pretty pictures in the background, although the standard option was still free.

Generali

DiggerUK wrote: »

At the time of the repeal, current accounts were free anyway. The charges referred to for cheques was a stamp duty tax imposed by the government, not the banks. If you cashed cheques at a bank other than your own there was a charge.

All debates had mention of there being no penalties imposed for the changes, now there is a proposal that bank accounts have automatic charges, at a time when banks have revealed to the most ignorant what their morals are.

Apart from this one:

Mr. Eastham My hon. Friend is correct in all that he says. The Minister said in Committee that facilities were available for those who were unable to get to the bank before it closed. He said that, for example, they could go to the Post Office. However, the Post Office has now said that a charge of 50p will be made to cash cheques on a Saturday morning.

That is not a stamp duty, it is a charge. Stamp duty is a tax payable on change of beneficial ownership, not on cashing a cheque.

DiggerUK wrote: »

What these proposals mean, is that we would have no choice other than having to deal through banking monopolies in order to get our pay, and having to pay for the privilege. And you defend that???
Payday loan scandals is one thing, payday charges is a danger to us all.
..._

You are wrong. In many countries (like Australia for example) paying charges for a current account is completely normal, in much the same way as you pay for any other service.

If I want to have my wages paid into a savings account which has no account holding fees then I can. I will have a card to enable me to withdraw funds and I am allowed a limited number of card transactions each month on top of that.

The proposal is that current accounts charge in a transparent way rather than by illegally charging huge fees to the poorest customers. I can understand why you want someone else to pay the costs of running your bank account but to expect banks to break the law to do so is pushing things too far IMO.

BTW, the Truck Acts only applied to manual workers. Other low paid workers (for example clerical workers, shop assistants, catering staff, menials, domestic staff &c) never received the protection of the Truck Acts.

antrobus

DiggerUK wrote: »

At the time of the repeal, current accounts were free anyway. The charges referred to for cheques was a stamp duty tax imposed by the government, not the banks. If you cashed cheques at a bank other than your own there was a charge.

Stamp duty on cheques was abolished on the 1st February 1971.

http://www.chequeandcredit.co.uk/cheque_and_credit_clearing/history_of_the_cheque/taxes_and_stamp_duty/

You don't really know what you're talking about, do you?

DiggerUK

At the time of the repeal, current accounts were available free of all charges. As the House of Lords debate I linked to shows, there were questions raised over having to pay for the privilege of collecting ones wages. That is a principle we should preserve, why do some of you suck up to the banksters?

Various charges for current accounts existed, usually on a charge if you were overdrawn. The payments for pretty pictures on cheques I can't recall.
The only charge for cheques I can ever remember was the stamp duty, and, as pointed out, abolished in 1971

I don't care what happens in other countries, I am only concerned that banksters don't get another way to fleece us here in the UK. We were promised there would be no detriment with the repeal, and some of you think it is ok for the government to dishonour that pledge.

Why should we pay, to collect our pay anyway, it's just wrong.
It's just another 'tax', and this time it goes straight to the banks.
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A._Badger

I have to say that my sympathies are with Digger on this issue - despite my usual lockstep agreement with the good General.

I'm afraid I simply do not believe that the astronomical sums of money floating around in computerised current accounts earning !!!!!!-all interest are a major overhead to the high st. banks.

That they (and some tame MPs plus an idiot like Turner) claim they are is beside the point, given the appalling track records of both MPs and banks.