Postal Services Bill
Debate between Baroness Kramer and Baroness Turner of Camden
Baroness Turner of Camden
I rise to support my noble friend in respect of this amendment. It is very important to accept that post offices have an important social role. One of the social roles they perform is that they are a point of access for—often not very well paid—people, including elderly people, who do not use banks because they do not know how to use them, are too concerned about them or are anyway not interested in speculative investment. Some people simply want somewhere safe to put their savings so that the savings are readily available when they need them, and they know that the savings are going to be safe because they trust the Post Office.
For those reasons, along with the excellent case made by my noble friend on the Front Bench, the Government really ought to look very seriously at what is proposed here. I am sure it would be popular with a very large number of the less well paid members of the public. People want to have somewhere safe where they can put their savings. We are hoping that people will save more and we have been saying for a long time that people are not saving enough. Well, some people do save, but they do not always know where to put their savings or where to go for financial advice or assistance. This would be an excellent idea, so I hope the Government will be prepared to accept what has been suggested in this amendment.
Baroness Kramer
My Lords, I have long been a fan of the equivalent of a post bank—as you know, it was Liberal Democrat policy. All of the arguments were made very strongly about the advantages that a post bank would bring to the financially excluded and those who are looking more for vanilla banking as well as to improving access for small businesses. It is hard to do anything other than come up with a list of absolute positives for a post bank.
Obviously, my colleagues in the other place were very eager to seize the opportunity for a post bank as part of the restructuring of Royal Mail, but then they came across the contract between the Post Office and the Bank of Ireland—although I do not know how much they know about it because obviously the contract will be confidential. However, I notice that the three names down on this amendment are those of the noble Lords, Lord Young, Lord Stevenson and Lord Tunnicliffe, and—I am sorry if I get their histories slightly wrong—I think it must have been on their watch that the contract with the Bank of Ireland was signed. That contract hidebounds the Post Office and makes it virtually impossible for it to provide the kind of comprehensive service and range of financial services without buying out that contract. Without breaching any confidentiality, perhaps they could tell us how many hundreds of millions of pounds would have to be paid to Bank of Ireland to buy out the contract so that a post bank could be put in place. I do not have access to that information, but perhaps, having been on the watch when that contract was originally put in place, they could give us a sensible estimate of what that amount of money could be. I am rather afraid it is such a large sum that it would have been difficult even in a time of prosperity and exceedingly difficult in a time of deficit. I greatly regret that.
I am glad that we had some discussion—there will be other opportunities—about bringing on board the credit unions. This House will be well aware that the Minister, Ed Davey, and others are committed to financing the technical platform that would make it possible for the post office to be used as the face of the credit unions. Credit unions are far more fragmented than a coherent bank would be, but at least that would open up the opportunity. I will also have a few words later to say about at least providing access to current accounts in the various high street banks. I wonder if they would give us an indication of what they think the cost would be for the Government to buy out that Bank of Ireland contract to make this very attractive proposition possible.