300,000 people more than 1 km from a free cash machine

I’m not sure I get the outrage about this:

About 300,000 people in low-income areas don’t live within 1km of a free cashpoint. This has been highlighted as a scandal for the consumer banking industry that makes “Wonga look like Santa Claus”, according to Frank Field, Labour MP and government adviser on poverty.

Umm, aren’t we all fat lardy bastards who should be walking more these days? And what is 1 km anyway? 10 minutes walk? Yes, actually, it is about that. A brisk walk is 4 mph so yes, 1 km is about 10 minutes.

Looks so horrible, doesn’t it? People might have to walk more than 10 minutes to get to a cash machine?

But it should be noted that this is merely part of a pattern; it even has a name, The Poor Pay More, and has been an observable sociological pattern since 1967, when it was systematised by sociologist David Caplovitz. You can see it in the £2 courgettes from those same convenience stores,

Err, if you’re buying somewhere on the grounds of convenience rather than price then yes, you will get stung on the price. It’s rather there in the name of the shop really.

in the astonishing fact that the poorest decile pays the most tax (“you’re talking about marginal tax rates”, people always say soothingly, at this point; as though that would be ok, to have people who earn the least paying the greatest penalty for working. But anyway, that’s incorrect: the boost to VAT, coupled with the senseless reduction in council tax credit, has left the poorest spending an eye-popping 47% of their income back to the government, a proportion which is only echoed in the top decile who, of course, have a surfeit of options to get round it).

Err, no, it’s average tax rates you want there. And I’m afraid, Zoe, that you’ve made a big boo boo there. You’re including a tax credit: which means we are looking at both taxes and benefits. And the actual tax rat on the poor, including both of those, is negative. Because they get most of their income from benefits, you see?

52 comments on “300,000 people more than 1 km from a free cash machine

  1. *cough* not all the poor get most of their income from benefits, since I was made redundant (again, need to pick better prospects), we’re getting Jennie’s income plus tax credits and child allowance, that’s it, we’re just above eligibility for other stuff and the hassle of filling in the forms isn’t worth the LHA we could theoretically claim as if I do get paid work you have to declare everything and lose stuff/reclaim, totally stupid.

    But yeah, I broadly agree with you on this, I live 5 minutes walk from multiple free cashpoints but neither grandmother lives within ten miles of a free one unless they’ve hidden one at a touristy place. But they both seem to manage fine, as do I if I visit, just takes a bit of planning (oh, and the pub takes debit cards).

    Poor people are far more inclined to work on cash generally and don’t put stuff in banks, but walking isn’t a major issue.

  2. Presumably this person is in favour of Tesco building more giant hypermarkets and squashing the more expensive greengrocers then?

  3. I shouldn’t be too upset about the last bunch of points. Okay, a lot of folk are going to keep struggling with the difference between “marginal” and “average” – there’s not much that can be done about that, it’s just something that people who you might expect to know better perpetually get wrong. The “poorest (read: lowest earning) decile” is also a banana skin in waiting since it can include people we don’t usually think of as poor – some students who may be in the higher earning deciles in a few years (anyone know which get counted towards these stats and which don’t?), early retirees who live off their capital while waiting to claim their pensions, and so on.

    But look on the bright side, there are nuggets in there. Recognition that incentives actually matter. Awareness that this is tied up with marginal rates, even if the concept is not clearly understood. Realisation that the current tax and benefits system treats low-waged folk in a messed-up way when the above is taken into account. This is stuff you and others have been writing about for years in the hopes of ramming it into the skulls of some of the political class. If these tropes are circulating more widely, that’s surely a good thing.

  4. I am 1.2km from the nearest cash machines, supermarkets, banks, greengrocer, post office and pound shop. I have to walk for several minutes to access any of these services. Even worse, there isn’t a direct bus to Sainsburys, which requires a considerable walk.

    It’s like Somalia, I tell you. Nobody should have to live this way.

  5. To be fair, a 1km walk through some of these areas probably seems like a lot further, especially if you have a pocket full of cash. I wonder how many of these ATM deserts are a result of the banks refusing to install them in areas where they’re highly likely to be knocked off?

  6. I wonder how many of these ATM deserts are a result of the banks refusing to install them in areas where they’re highly likely to be knocked off?

    Very few, to be honest. It is mostly down to banks not wanting very poor customers (with the exception of the already mentioned students), closing as many branches as they can get away with now people are using the internet, credit and debit cards and, frankly, branch staff having absolutely no decision-making power whatsoever, etc.

    All the bank and other free ATMs in my wee town are concentrated in the centre, with one at the small Sainsbury by me and the next, going south, at the Co-op in the ‘next’ village. I would guess that about half to 2/3rds of the town is outside that area (from a quick look at Google Maps.)

  7. “Err, if you’re buying somewhere on the grounds of convenience rather than price then yes, you will get stung on the price. It’s rather there in the name of the shop really.”

    Sorry but it is expensive to be poor. Maybe it’d be worth trying it sometime?

    There’s a level of income, below which, a lot of supposed economies cease to work. It makes sense to spend a pound on bus fare to do £10 worth of shopping & save £2 against the convenience store. At £5 worth of shopping the advantage disappears. But the poor, by necessity, have reduced time horizons. The winds of fate blow very strongly on the poor. Strategies to reduce outgoings by planning ahead work if one can predict what’s ahead. If you can’t, having spent the money then rather than having it now may not be optimum.

  8. BIS-

    Time preference; it gets higher the poorer you are. Hence the failure of the bourgeoisie to understand why Wonga’s interest rate is economically rational for somebody living hand to mouth.

    This, by the by, is one reason I’ve always considered monthly wages to be a grotesque injustice when inflicted on the low paid. When I am Prime Minister, I will pass a law giving every employee the right to weekly wages.

  9. Most cash points are part of banks. Banks tend to congregate in town centres for completely obvious reasons. If you live in a suburb more than 1km from the centre then you are obviously living in extreme poverty and distress and someone must be taxed heavily, RIGHT NOW, to fix the problem.

  10. A fair few poor have reduced mobility issues. A pair of dodgy lungs might mean being unable to walk 0.6miles (1km) without multiple breaks, especially if there are hills.

    Still, it’s a #firstworldproblem and one that should be cheap and easy to resolve.

  11. Yes Ian But said bourgeoisie, fallen on hard times, find being poor is even more expensive for them than it is for the poor. Sweet justice.

  12. I’m all for giving the banks some sort of USO to provide a free bank account and debit card so that the poor can get access to cheaper purchases on the Internet and other benefits of online banking.

    Round here the nearest cash point must be about 15km away, so we all get cash back from the local shop and pub. Cash back is zero risk for the shop and pub and in some of those poor areas mentioned its probably a good thing to have less cash in the till.

  13. So what’s the solution then? Government intervention to ensure the availability of free cashpoints for all?

    Reading through the comments on the article, I find it hard to believe that there are many people who:

    1. Can’t walk 1km
    2. Don’t have a debit card
    3. Have no one who could take them to a cashpoint once in a while, and;
    4. Have to make a special trip to take out a tenner on a regular basis.

    So do we really have a problem?

  14. This brings us back to why we really need something like bitcoin, so people don’t need an “account” with anybody in order to transact. Money needs to be neutral, which means it needs to be unmoderated. Currently, only cash fulfills that function, and if we are heading for an entirely electronic future, we need some similarly unmoderated equivalent.

  15. @Blue Burmese
    You really are displaying your middle class roots there.
    It’s reminiscent of a debate in the comments here a couple years or so back on the lass needing a fridge. The consensus was headed, she could go buy a second hand one. Except people poor enough not to be able to buy a new fridge don’t have friends with cars to collect second hand fridges for them. Often don’t have much in the way of friends at all. Not friends with the surplus means or the inclination to assist. It really is a tough unforgiving life at the bottom. That’s why it’s so hard to get away from..
    Same as SBML
    “Cash, what’s that. I hardly use it. Why do I need an ATM to get something I don’t use.”
    Try using a card to spend 3 quid. Lot of shops have a minimum card spend because of transaction costs. Or make a charge for card use to defray them.

  16. @ MBE
    “some students who may be in the higher earning deciles in a few years (anyone know which get counted towards these stats and which don’t?),”
    It’s based on a “household survey” so if the students are in college buildings they don’t count, if they are in a flat or house they do. And student loans don’t count as income but their expenditure does.
    Likewise squaddies in barracks don’t count but officers in married quarters do.
    And the data for the bottom decile is badly wrong because, ONS points out, the treasury pays out 50% more in benefits than the amounts included in income in the survey.

  17. BIS-

    I remember that discussion, and agree.

    Just for anecdata, my local paki shop (the only shop) charges 50p for using a card, which is why on wednesday morning I staggered 2.4km (approx) through a squalling gale so I could get some cash to buy some stuff to eat, due to a previous debacle involving making a sandwich with the last stuff in the fridge, only on first bite to realise that the salami had gone off despite being before its use by date.

  18. @BiS

    My point was that although 300,000 people in low income areas don’t live within 1km of a free cashpoint, for how many of these is this actually a problem? I doubt it’s that many. No doubt the Graun will be running an article in the next few days on someone’s sick, disabled, widowed granny suffering from cashpoint poverty.

  19. The use of KMs is clearly designed to deceive and has lowered my opinion of Frank Field, a politician who I had respected prior to this, for putting his name to such chicanery.

    1km is 0.62 miles, or in broad terms, half a mile. Would we think it unreasonable that a healthy, poor person could walk that? What happens when yo do the same calculation with a mile?

    On top of that, there’s the poor people who go and work somewhere. And may have access to an ATM.

    And what are people using that money for? Going to shops? And those shops don’t take cards? They all don’t have an ATM near them?

    Even if not that, don’t they have neighbours who can lend them a tenner? We’re always told that these are “communities” by lefties, so why aren’t they behaving like a community?

    We’re at a number of people that we could categorise as “disabled people living at the bottom of a hill, 2 miles from an ATM with nothing but a self-propelled wheelchair and no friends, family or neighbours to help him out, and a shop nearby that doesn’t take cards but does have a pay-per-use ATM”. In which case, fine. Stick another £1.50/week on disability living allowance and that’s job done.

  20. Okay,

    So let’s actually look at the “poor person” problem.

    If we accept that 1km is a valid distance (and I fully accept for the elderly or disabled, it may be a bit excessive), then why is it the “home” that is the specific issue? Why not the Community Centre, the children’s school(s), the nearest effective shopping area, the Post Office, the place of work (or the JobCentre)? Certainly, in my local area – which is hardly Egerton Crescent or Sandbanks – the Community Centre is within 150m of 5 free ATMs and the Post Office (which will happily do you cash-back) within 80m of 4 (and 120m of the fifth.)

    Even if you take the limiting example of the extremely rural poor, there is likely to be one within a reasonable range of somewhere you have to go on a weekly or similar basis.

    Okay, if you are housebound for whatever reason, then you have a problem. But then you would still have a problem if the nearest ATM was 50m away?

  21. Anyone who has trouble walking a kilometre as needed ought to be eligible for the higher rate of Mobility Allowance.

    What is it Tim likes to say about measuring poverty rates after the things we do to alleviate poverty?

  22. Anyone who has trouble walking a kilometre as needed ought to be eligible for the higher rate of Mobility Allowance.

    I’m not sure that this is “ought to” (ymmv) but it is definitely not “will, under the current rules”.

    From the Citizens’ Advice site:

    a. Can stand and then move more than 200 metres, either aided or unaided. 0 Points

    To get the Higher Rate, you’d then need to be completely incapable of planning or following a route:

    Cannot follow the route of a familiar journey without another person, an assistance dog or an orientation aid.

    To get the lower rate, you’d need to be at least:

    Cannot plan the route of a journey.

  23. Moggie Azul
    The comment was specifically about the “Have no one who could take them to a cashpoint once in a while,” & not generally about plastic & ATMs.
    There is a tendency to see solutions that often aren’t open to the people most needing solutions. Which also applies to ideas like getting cash-back from the store or pub. Having to buy something you don’t need, to get access to your own money, isn’t a solution when the cost of the not needed item is the money you needed to buy what you do need.
    It’s what i was referring to when I mentioned the problems of the newly impoverished bourgoisie. How quickly they find they no longer have the helpful friends. How a wrong choice, Ian’s dodgy salami, can mean not an irritation & a walk but no food today.

  24. SE>

    I have no idea what you’re reading, or not reading, to come up with that. It’s not a cumulative thing.

    Individuals are entitled to the higher rate mobility component of the DLA if they “are physically disabled and as a result are unable, or virtually unable, to walk”.

    There are also provisions for people with mental disability who are unable to go out without a carer, but I’m not sure why you think they’re relevant. Those people generally aren’t allowed to take money out of their bank account or spend it without a carer present, either.

  25. These people without cash machines nearby – no post office or supermarket giving cashback either? Or just out of hours access needed?

  26. Dave,

    I have no idea what you’re reading, or not reading, to come up with that. It’s not a cumulative thing.

    Yes, I’m afraid, it is. Here.

    You need 8 points for the basic and 12 for the enhanced. Which you get from an addition of your points for the “planning and following journeys” assessment and the “moving around” assessment. Both of which give you between 0 and 12 points.

    Not sure where you are getting your information from about the mobility component of PIP. You might want to rethink or try trolling somewhere with lower evidence standards*.

    * Yes, snarky, sorry. Bad week.

  27. Oh and “virtually unable to walk” and “has trouble walking a kilometre”? Not the same thing. Not even in Polly-ville.

  28. “But it should be noted that this is merely part of a pattern … You can see it in the £2 courgettes from those same convenience stores”

    Do many very poor people buy courgettes? I thought the usual complaint was that they are always being poisoned by the industrial food complex because they only buy processed food.

  29. bloke in spain – “Except people poor enough not to be able to buy a new fridge don’t have friends with cars to collect second hand fridges for them. Often don’t have much in the way of friends at all. Not friends with the surplus means or the inclination to assist. It really is a tough unforgiving life at the bottom.”

    This is not my experience of the poor. Who tend to get by with massive amounts of help from friends and relatives. It is the stingy middle class that is too busy on the weekend to help a mate get a new fridge, and that is probably because they don’t think they will ever need the help themselves.

    But it brings it back to what is causing the poverty. We have had the Left wage war on the family for 50 years. Working class families used to be cohesive. I expect the same is not true for the underclass. The solution is, surely, for people to get and stay married, to stay in touch with their parents, to be good friends. That kind of thing.

    Where the nearest cash point is seems to me to be irrelevant to the bigger problems.

  30. Look, it’s about drugs, right?

    Narcotics retailers don’t give cash back and they don’t take cards.

    Drugs.

  31. SE, I have worked on both mobility allowance (pre 1992) and DLA (its replacement). Both were based on distance for higher mobility (used to be only mobility part). Nowhere near a kilometre, it was 100 metres. And someone able to walk say 80 metres, rest a few seconds then carry on to do 100m was often classed the same as someone able to walk 100m.
    The benefit was designed for those who have the most trouble walking, not those who had any trouble walking.

  32. I’m with Roue le Jour here. According the the Citizens Advice Bureau 96% of all benefits claimants are paid direct to a bank account, so benefits claimants shouldn’t need cash any more than the rest of us do, which is virtually zero in my case. The only reason one needs cash nowadays is if one is spending money in the illegal or black economy.

  33. The only reason one needs cash nowadays is if one is spending money in the illegal or black economy.

    Are you serious?

  34. @SMFS
    “the poor. Who tend to get by with massive amounts of help from friends and relatives”
    Are you talking about the poor or the working class here? The working class aren’t necessarily poor. The poor I’m talking about are those with incomes that don’t exceed needs. Often needs that exceed incomes. That’s all sources including family & friends or we’d be lumping the Sloan set in with the poverty stricken. From which example it’s possible to deduce the poor are poor because they don’t have anyone who’s in a better position than they are to assist.

  35. @Ian
    “Are you serious?”
    I really believe he is.
    But it truly makes you wonder what sort of life he leads. Does he never buy a pound of apples in the market? How does he buy a beer in a pub? Must make him very popular with barstaff chipping & pinning every pint or does he know that rarest thing in British boozing? The bar let’s you run a tab?

  36. To add: It certainly reinforces my views on the helpfulness of suggestions from the bourgoisie, stated above.
    The lack of understanding that his “virtually zero” part of his spending may necessarily be virtually all of the spending of someone on lower income

  37. Indeed. I could also add, “the right change for the bus fare”. It’s a different worlds thing, and that tends to infect all these discussions. Everyone has a habit of thinking that their own experience of life is somehow representative, or the norm, or whatever.

    I appreciate also that nobody is obligated to read my witterings, but my salami-gate example above is surely relevant.

  38. Ian B – suprising how easy it is to buy bus travel online if using a bus regularly.
    Or even in some shops.

  39. @ Jim
    Paying by cards involves a cost – usually to the vendor. My local newsagent only accepts credit/debit cards for sums in excess of £5 so as a relatively well-heeled purchaser of the horrendously overpriced FT I have to pay cash. If my wife or I is a day late returning a library book, that is cash. Since when was my local library part of the black economy? I buy fresh fruit and veg and fish at the market – who can’t have card machines with no ‘phone lines – so I pay cash and I have no reason to doubt that they are totally honest.
    Presumably you prefer to buy stale food from a supermarket.

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