Bank accounts for all could help reduce re-offending rates

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Confirmation in the Budget that everyone in the UK will have the right to a basic bank account will come as good news to vulnerable and financially excluded groups, such as people coming out of prison, and according to some, could help reduce re-offending rates.

Women leaving prison are all too often among the UK’s 1.75 million people who do not have a basic bank account. Anyone applying for a bank account must reveal their financial history, such as fraud, bankruptcy or bad debt, and the prospect of facing old debts and no documents to prove identity or address history make for an uphill struggle for those trying to get to grips with their finances.

But the Co-operative Bank’s accounts for prisoners scheme has had a positive impact in helping to reduce re-offending rates by around a third for those involved.

Following a pilot project at Forest Bank Prison, Salford, starting in 2007, The Co‑operative Bank now accepts applications from 29 prisons, representing nearly 20 per cent of the UK prison system, and the total number of accounts opened since the scheme began has reached over 1,400.

The provision of a bank account can be a vehicle to facilitate employment and housing for offenders leaving prison; factors which are considered key to the reduction of re-offending. Prior to release, prisoners are offered the opportunity to open an account, which will be ready for use on release.

In December 2008, Liverpool John Moores University published its report, Banking on a Fresh Start (click here), commissioned by the bank, which researched the impact and effectiveness of the pilot scheme at Forest Bank Prison. The study found that, of the 193 prisoners released since opening accounts, 72 had since returned to prison, representing an average re-offending return to prison rate of 37 per cent, compared with a national average of 67 per cent.

Paul Jones of Liverpool John Moores University said: ‘Bank accounts are not the panacea for reducing re-offending rates, but it is clear they are an important element in enabling ex-prisoners to become valuable members of society.’

As one former inmate told the researchers: ‘Getting this bank account has allowed me to get paid for my job; it has given me a sense of self-respect more than anything; and allowed me to feel part of society again. Every time I go into a shop and use a debit [card] I do feel good about myself. It is amazing, it does make a difference.’

Of the 27 prisoners aged between 21 and 24, 25.9 per cent re-offended within twelve months of release – a reduction of more than 37 per cent on the national re-offending rate for this group. The research found re-offending rates lower than the national average across all prisoner categories and highlighted the important role access to bank accounts can play – not only in the effective resettlement and rehabilitation of prisoners, but also with longer-term social and financial inclusion.

Neville Richardson, Chief Executive of The Co-operative Financial Services, said, ‘Since the scheme began, The Co-operative Bank has opened more than 3,500 basic bank accounts for prisoners and we have a relationship with 30 prisons, which represents nearly 20 per cent of all UK prisons. However, we cannot tackle this important issue alone. Therefore, I would encourage other banks to play their part in providing accounts for prisoners so all inmates can have this opportunity.’

Neville said of the Budget: ‘For the banking sector to fully regain the trust lost by the events of the credit crunch, it is vital that each business fully plays its own part in supporting social and financial exclusion.’

Information for women leaving prison is on a new section of the FMWF.com website called ‘Fresh Start’: click here.

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Tags: Women in Prison - Advice, Women in Prison - Financial Advice, Women in Prison - Rehabilitation

Posted by Vicki Owen on Sunday, March 28th, 2010 at 9:10 am.

Filed under Data Bank, Equality, Fresh Start, News, Personal Finance, Tagged as: , Women in Prison - Advice, Women in Prison - Financial Advice, Women in Prison - Rehabilitation.