Bridgeman orders banks to declare cash charges

John Bridgeman, the director general of Fair Trading, has ordered the banks to provide full details of their plans to charge for cash machine withdrawals by 22 March, dashing hopes that the controversial issue could be laid to rest until the charges come in at the start of next year.

The request, sent to all 34 member banks of the Link cash-machine network, follows a meeting a fortnight ago between Stephen Byers, the Secretary of State for Trade and Industry and John Hardy, the chief executive of Link.

It comes as the banks are preparing to face a fresh onslaught on Monday when Don Cruickshank, the former telecommunications watchdog chief, publishes the results of his 18-month review into the banking industry.

Mr Hardy was joined by Link board members representing several of the banks who made it clear that they, and not Link, were responsible both for the decisions to impose charges and also the level at which they were set.

Mr Bridgeman chose not to make the letter public because the information to be provided will be treated as confidential within the terms of the Competition Act.

In his letter, the director general asks for highly detailed information about the proposed automatic teller-machine charging structures for each bank.

In particular, he wants to know which banks intend to take advantage of the new Link rules allowing non-customers to be surcharged for using cash machines operated by another bank, at what level such charges will be set and what the justification for the charges should be.

He also reminds the banks of his powers under the new Competition Act to tackle excessive charges.

Barclays, Abbey National and Lloyds TSB have all said that they intend to impose what they prefer to call "user charges". The banks have also made it clear that they intend to charge more than the 30p ceiling Mr Cruickshank has recommended. However, they have said that they need several months at least to decide on what level of charges to set.

Mr Bridgeman is due to be removed from his post when his contract expires in October following government concern that he has been too "soft." The director general, who is 55, would have liked to have stayed on. However, he has accepted that the Government wants to create a more powerful role for the competition watchdog. Mr Bridgeman fell out with the Government over a succession of investigations including the price of soft drinks in pubs.

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