James Daley: The UK's most expensive cashpoint charges £10 a go - and why not?

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The Independent Online

An awful lot of fuss has been made about cash machine charges over the past few weeks, with consumer groups, MPs and much of the media working themselves up into a lather over the fact that the number of charging cashpoints (or ATMs, if you prefer) is on the rise.

An awful lot of fuss has been made about cash machine charges over the past few weeks, with consumer groups, MPs and much of the media working themselves up into a lather over the fact that the number of charging cashpoints (or ATMs, if you prefer) is on the rise.

According to recent figures, the proportion of machines that charge has gone up from 20 to 40 per cent over the past two years, and at this rate (said one consumer rep to a BBC radio presenter last month), every machine in the country will be charging by 2009.

This is utter nonsense. And while I very rarely disagree with Which? (which came up with this ludicrous prediction), this is one area where insanity seems to have overcome common sense. Although the number of charging ATMs has risen over the past few years, so has the number of free cash machines - a fact often overlooked. What this means, is that (by and large) people's ability to get their hands on their cash for free has not diminished. It has increased.

What has changed is that shrewd private companies have begun putting charging machines in places that never had them. Pubs, cinemas, convenience stores are now common homes for ATMs - and though most of these will charge up to £2 for a withdrawal, most are within spitting distance of a bank that will charge you nothing. Before you complete your transaction, you are warned of the fee and have the option to cancel - but in many cases, people are happy to take the hit.

This week, I found what I think is the most expensive cash machine in the UK - charging a whopping £10. It is at The Miranda, a private members' club in Soho. While some will criticise this as extortionate and irresponsible, I can't see the problem. The Miranda is within a stone's throw of several other cashpoints, and for those who have more money and more apathy than sense, why shouldn't there be a charge of £10?

Where the cash machine debate gets more interesting is when you look outside the cities. In many rural villages, charging ATMs are now the only cashpoints within a 10-mile radius. But does that mean the cash machine company should have stayed away? In many cases, the new charging ATMs give villagers a choice they didn't have - get your cash here and pay £1.50, or get on the bus and get your cash for free in town.

But what if the bank or the post office has recently closed down - is it fair then? Maybe not. But if the government expects banks to adopt a social conscience, and to put free cash machines in areas where the low footfall means they are not profitable, then it must legislate to force them to do so.

When the Treasury Select Committee begins its investigation into all this later this month, let's hope it manages to inject some sanity into the debate. Banks such as Alliance & Leicester, which still charges at some of its cashpoints, may well deserve to be castigated. But the private operators, who are simply increasing consumer choice and providing a service, have nothing to answer to.

* I always cringe when I hear tales of how financial services companies incentivise their employees to meet their sales targets. Trying to push investment products without explaining the risks, or giving the hard sell to insurance policies without revealing the exclusions, are both practices that were invented by sales teams driven too hard to meet their targets. But after hearing the latest motivational techniques from Norwich Union, I'm not too worried about their staff skimping over the detail to flog their products this Christmas.

In a press release this week, NU boasted that winners of its in-house challenge to promote its new insurance offer would get - wait for it - lunch with a Christina Aguilera lookie-likey. Cruel. You would have thought with profits of £2bn a year, it could have at least provided the genuine article.

Mr Brown's resolute inaction on pensions

It seems remarkable that less than two months after Adair Turner published his bleak first report into the state of the UK pensions market, Gordon Brown managed to deliver an entire pre-Budget speech without addressing any of the serious issues that Turner raised.

The only mention of pensions, in fact, was to boast about just how well the pensions credit is working - something that everyone who works in the industry, including Turner himself, knows to be a bare-faced lie.

While even the Government has now admitted that the credit can act as a disincentive to people to save, it is also failing to reduce pensioner poverty at the kind of speed it needs to, if it is to keep pace with the rate at which the elderly population is growing.

Ros Altmann, the Number 10 adviser and general pensions superheroine, says that even if the Government manages to get 85 per cent of pensioners to take up the credit (a target that it remains a long way from), there will still be a million pensioners in poverty by 2040.

The one saving grace of the pre-Budget report was a reprieve for the annual Isa limits, which were on the verge of being slashed to paltry levels in April. But this hardly amounted to blind generosity.

Even by keeping the Isa limits where they are, the Government is doing less than what most would consider to be the bare minimum to incentivise saving.

We can only hope there is much more to come after the election.

William Kay is on holiday

j.daley@independent.co.uk

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