News & Events

Open letter to Bank of England

Posted: 24th January 2014

CMS Company Message

In December 2014, the Bank of England made a decision to introduce Polymer Banknotes into circulation, starting with the £5 notes in 2016 and the £10 note in 2017.

Cash Management Solutions has voiced its concerns in an open letter to the Bank of England, wrote by CEO, Brendan Doyle:

Dear [Name Supplied],

I am writing to put some questions to you about the process the Bank of England has followed regarding the introduction of Polymer notes and to tell you that I would like to see an independent review of this decision.

I had understood that the Bank would engage all stakeholders in the process and that a key element of the decision making process was to be an analysis of the costs of the change-over to the private sector. I was, therefore, very surprised to see that a decision was announced within days of the Christmas holiday with no reference to the cost benefit analysis having been completed. Indeed, no mention was made of any of the concerns I raised during the consultation process.  Given the position we are now in, I have asked that the matter be raised with HM Treasury as I believe that an independent review of the decision is necessary. 

My concerns are as follows; 

  • As the Bank of England stands to gain financially from the changeover, the consultation process should have been conducted independently with a remit to undertake a cost benefit analysis for the whole economy. 
  • Given that we are still not aware of the costs of introduction, I am concerned that the consultation may not have been thorough & transparent. 
  • As it is, the decision may involve a significant transfer of costs from the public sector to the private sector. 
  • That this decision may be consistent with a number of decisions by the Bank of England, over a long period of time, that have increased barriers to entry in the cash processing industry, resulting in higher long term costs for consumers and businesses. 
  • That a number of businesses, especially smaller ones, associated with cash provision, may suffer disproportionately from this decision. 
  • Conversely, a number of businesses, especially larger ones, may gain financial & commercial benefits from this decision at the expense of smaller rivals. 

It would be good to understand the Bank's position on the above points, as I would like to know whether or not they have been considered and the importance given to each in the process.

Kind Regards, 

Brendan Doyle
CEO, Cash Management Solutions 

 

-- [ENDS]

 

If you would like to speak to CMS about any of these issues raised, please contact Matthew Shaw, Head of Marketing on +44 (0)1925 412 904 or mshaw@cashmanagement.co.uk.