Ministers attacked for failing to act on ATM fees

Nationwide Building Society, which is campaigning against banks' cash machines that charge, called the Government's attitude on the issue "disappointing and complacent" after it gave its response to a Treasury committee report.

In a statement yesterday the Government said: "We do not believe that free ATMs [automated teller machines] in the UK are under threat."

The committee, chaired by John McFall, had voiced concern this year over the growth of charging machines, which now account for 37 per cent of the total.

Despite examples of banks selling some machines to independent operators - HBOS sold 816 to Cardpoint - the Government said it was reassured by pledges from all the major banks they would not sell off any more of their ATM networks. It also noted the number of free machines is growing at 3 per cent a year. "However, the Government would be concerned if evidence were found of a significant reduction in the number of free ATMs," it said.

The committee's report had raised concerns that people on lower incomes could face disproportionately higher costs as a result of cash machine charges. But the Government said yesterday: "On existing evidence, we do not believe that is the case."

It pointed to the Post Office, which provides free, over-the-counter cash withdrawals for basic bank accounts as well as for current accounts with some of the major banks. Yet the Post Office has been criticised for allowing charging cash machines on to its sites, although this week Bank of Ireland promised to install free machines at 1,000 post office branches.

Nationwide said consumers would pay £200m this year to withdraw their own money from ATMs.