Postal Services Bill

Baroness Wilcox Excerpts

Wednesday 4th May 2011 Lords Chamber

[Lord Razzall]

I stand by the point that I made in Committee: in the current climate, it would be extremely unlikely that there would be an IPO for the Royal Mail.

The noble Lord, Lord Lea of Crondall, demonstrates another reason why that is highly unlikely. The fundamental difference between this and the privatisations to which he and his colleagues referred in the 1980s and 1990s is an ideological belief on behalf of the then Conservative Government that those industries were better held not by the taxpayer but by public shareholders. In those circumstances, there was clearly an interest in creating an aftermarket, so that as many individual shareholders—in the case of BT, it was a huge number of individual shareholders—should have an incentive to buy shares and then make a profit. The reason why that would not apply in this case is that the fundamental reason for the transaction would be to get resources into the Royal Mail. In those circumstances, the Government would not have an interest in creating the sort of aftermarket that the noble Lord, Lord Lea, fears. The significant interest of the Government would be to maximise the financial return for the Royal Mail, because the whole purpose of this is to get investment into Royal Mail, not to provide a windfall for shareholders.

[The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Baroness Wilcox)]

My Lords, Amendment 1 would restrict the number of shares that can be sold in an initial public offering—an IPO—to 30 per cent of the value of shares, and imposes a time limit for the sale of one year from the new clause coming into force.

First, the Government believe that Royal Mail needs an injection of private sector capital to meet its needs in a fast-changing postal market. Unlike the previous Government, we do not believe that there should be any barriers in legislation to prevent a disposal of a majority of the shares. The Government’s objective in disposing of shares in Royal Mail is to secure the future of the company and to secure the best value for the taxpayer. To achieve that, the Government must have flexibility on when to sell shares and how much should be sold.

The noble Lord, Lord Lea, is concerned that previous privatisations have resulted in the taxpayer losing out through undervaluation; the noble Baroness, Lady Turner, spoke in support of his concerns. Noble Lords have a great deal of knowledge of previous privatisations; it is one of the great assets of your Lordships' House. I cannot answer for why they were done as they were, or what were the objectives of those privatisations. I am absolutely clear that our intention will be to secure the best deal for the company and the taxpayer consistent with our objectives. We will ensure that whatever form private sector investment takes in this instance, it will be with those objectives in mind. I thank the noble Lord, Lord Razzall, for his clarifying statement on that.

As I said in Committee, the Bill would allow the sale of a minority of shares in Royal Mail, and a sale by means of an IPO, if either or both were decided to be the best route to achieve our objectives. We do not, however, believe that there should be a time limit on the sale. The Government must have the flexibility to choose the right time to dispose of shares to ensure that we can get the best result for Royal Mail and the taxpayer.

The noble Lords, Lord Lea, Lord Young and Lord Borrie, also asked how Royal Mail will be valued. If I may, I will come back to those issues when we discuss Amendment 3, which directly addresses that point. Arbitrary deadlines in legislation would mean that the process might be rushed through, which is not the best way to conduct what would be a significant commercial transaction. I do not believe, therefore, that Amendment 1 would be in the interests of either Royal Mail or the taxpayer, and I would therefore hope that, following my explanation, the noble Lord will feel able to withdraw his amendment.

--- Later in debate ---

[Baroness Wilcox]

My Lords, Amendment 2 seeks to keep the Royal Mail in public ownership and reflects the position set out in the previous Government’s Postal Services Bill, which this House considered in 2009. As I said earlier in response to Amendment 1, the difference between the position of this Government and the previous Government is that we do not believe it is necessary for the Government to retain overall ownership of Royal Mail. Public ownership has not helped Royal Mail to move with the times and to make the changes that it needed to succeed. That is why we need a different approach if we are to safeguard the universal postal service, and that is what we are committed to doing.

The noble Lord, Lord Young, questioned the Government’s mandate for the Bill. The Liberal Democrat manifesto was explicit about the need for private sector investment and employee shares. The coalition agreement was explicit that:

“We will seek to ensure an injection of private capital into Royal Mail, including opportunities for employee ownership. We will retain Post Office Ltd in public ownership”.

The Bill does exactly what we said we would do. There are several reasons why we should not seek to retain Royal Mail in public ownership. I covered these at length in Committee but, to summarise: first, the Government cannot provide capital fast enough and any funding we provide has to be cleared by the EU under state aid rules. My noble friend Lord Jenkin of Roding spoke most eloquently from his past experience in support of that. Secondly, limiting a sale to only a minority of Royal Mail’s shares will reduce our ability to attract the best future owners for the company.

The noble Lord, Lord Young, asked about the provision to amend the minimum requirements of the USO in Clause 33. Again, I will come to those issues when we discuss his Amendments 65 and 66. I ask the noble Lord to withdraw his amendment.

[Lord Young of Norwood Green]

My Lords, I listened carefully to what the noble Lord, Lord Jenkin, said. I remember that occasion well, given my interests at the time and the continuing interest which I declared on a previous occasion. As I said, we do not seek to oppose the injection of private capital. Interestingly, there was almost unanimous support for the 2009 Bill, which applied the same formula that I applied to the House today. I hear the points made by the Minister on private sector investment but it is not quite true that it said “100 per cent privatisation” in either the coalition agreement or Liberal Democrat manifesto; I noticed that those were not the words that she used. I stick by my original assertion that this is new territory. It is an important and fundamental decision and one on which we should test the opinion of the House.

--- Later in debate ---

Some or all of Royal Mail may be passed on to shareholders. When that happens, in many respects the accountability for running that business will pass from the Minister’s hands. However, until we reach that point, the Minister remains accountable to Parliament for what he does in respect of Royal Mail. This share disposal and the complex processes that lead up to it fall firmly within that remit of accountability. It would be wrong for Parliament to have to force the hand of the Minister on this matter at a later date. Accountability post sale is no accountability at all. Once the sale has taken place, if the Minister has made a mistake it will be nigh on impossible to rectify. By providing Parliament with an independent valuation in advance of the sale, we can deal with any issues that might arise at the appropriate time. I beg to move.

[Baroness Wilcox]

My Lords, Amendments 3 and 13 seek to place additional reporting requirements on the Secretary of State, while Amendment 5 would introduce additional parliamentary procedures before there can be a disposal of shares in a Royal Mail company.

Amendment 3 would require the Secretary of State to report to Parliament how the value will be assessed, and to make available to the Public Accounts Committee of the other place an independent valuation of the business. As we debated in Committee, there are incredible sensitivities about revealing the estimated value of Royal Mail shares prior to a commercial negotiation. We would be giving the whip hand to the potential investor. This does not make commercial sense and would greatly reduce the potential for getting the best value for the taxpayer from any future transaction. The Government will work with their advisers to consider the potential value of Royal Mail so that they can properly assess bids from buyers. Before a sale, the accounting officer for the Department for Business would need to scrutinise any future transaction to ensure that it represented value for money for the taxpayer.

I reiterate what I said in Committee: we would expect that, after a sale had completed, both the National Audit Office and the Public Accounts Committee in the other place will wish to review the sale process. They would both provide their own independent view to Parliament on whether the Government had achieved value for money for the taxpayer. This is completely in line with the reporting requirements for previous sales of government assets.

Amendment 5 would require that the Secretary of State made an Oral Statement and that an order was laid that was subject to the affirmative resolution procedure before there could be a relevant disposal of shares in a Royal Mail company. As I said in Committee, further parliamentary procedures should not be required before there can be a disposal of shares in Royal Mail. The disposal of shares, as set out in the Bill, has been debated fully in both the other place and this House. The Opposition’s Postal Services Bill of 2009 did not include a requirement for additional parliamentary procedures before there could be a disposal of shares. As they said at the time, such a requirement would cause uncertainty for potential investors. That uncertainty is the same whether we are selling a majority or a minority stake. I said in Committee that I fully agreed that an Oral Statement might be appropriate for the first sale of shares. We will discuss with the House authorities the appropriate format for such reports at the relevant times.

I turn to the last amendment in this group, Amendment 13. The purpose of Clause 2 is to ensure that Parliament has transparency about the way in which shares or share rights in Royal Mail that reduce the proportion owned by the Crown are disposed of. The amendment would require reporting on any subsequent disposal of shares by the original purchaser. I do not consider that such a reporting requirement is appropriate. I know of no precedent for this type of “open-ended” reporting in any previous privatisation. The Companies Act requires that a private company has to disclose a full list of its shareholders on incorporation and then with the first annual return to Companies House following incorporation. It then has to provide such a list every third annual return after a full list has been provided. Information on ownership of Royal Mail will, therefore, continue to be publicly available.

As with discussions we had in Committee on other aspects of the Bill, I see no reason to impose more onerous reporting requirements on a privately owned Royal Mail than those that are currently imposed on privately owned companies. Clause 2 does, of course, continue to apply to any disposals of shares by the Secretary of State himself after the initial sale. The crucial issue, however, is not ownership but securing the future of Royal Mail, and in doing so securing the future of the universal postal service. Regardless of who owns the company, it would still be the universal postal service provider in the United Kingdom. It will still need to comply with any conditions issued by Ofcom in the universal postal service order to be made under Clause 29 of the Bill. The purchaser would, therefore, be fully aware of the obligations that the company it is purchasing must deliver.

The initial conditions in the universal postal service order will follow those currently set out in the licence issued to Royal Mail by Postcomm. Condition 12(5) of that licence requires Royal Mail to notify the regulator if there is any change of control in the company. It will be for Ofcom to decide whether to impose similar conditions in the future as part of delivering its overall duty to secure the future of the universal service. With these reassurances, I ask the noble Lord to withdraw the amendment.

[Lord Young of Norwood Green]

My Lords, I have listened carefully to what the Minister said and I welcome her assurance regarding the Oral Statement. That represents some progress, but we still feel that she has not fully addressed our concerns about the presale valuation and the ability to report to the Public Accounts Committee in confidence. We will reflect on the situation, but in the light of what has been said I beg leave to withdraw the amendment.

--- Later in debate ---

Moved by

[Baroness Wilcox]

6: Clause 2, page 2, line 5, at end insert “, and
(c) the objective intended to be achieved by the undertaking of it.(3A) The report must—
(a) contain information about the expected commercial relationship, after the proposed disposal, between the Royal Mail company in question and any Post Office company, and
(b) if the proposed disposal would result in shares or share rights being owned by or on behalf of an employee share scheme for the first time, give details of the scheme.
In paragraph (b) “employee share scheme” has the meaning given by section 3.”

[Baroness Wilcox]

Amendment 6 is intended to increase transparency in relation to any future disposal of shares in Royal Mail, as well as to provide further information on the commercial relationship between Royal Mail and Post Office Ltd. At the same time I will speak to Amendment 7 in the name of the noble Lord, Lord Whitty, and Amendment 8 in the names of the noble Lords, Lord Clarke and Lord Christopher. I hope that Amendment 6 will ease the concerns expressed by many noble Lords in Committee and provide further reassurance that the Secretary of State will be open and transparent about decisions taken on the future of these two businesses. The amendment relates to the report which will be laid by the Secretary of State before Parliament once he has made the decision to undertake a disposal of shares in Royal Mail.

Amendment 6 serves three purposes. First, it clarifies that the Clause 2 report must state the objective intended to be achieved by the share disposal. Secondly, it will ensure that when shares are proposed to be put into the employee share scheme for the first time, the report must include details of the scheme. Thirdly, it will ensure that the report includes information on the ongoing relationship between Royal Mail and Post Office Ltd after any disposal.

Perhaps I may take these in turn. In terms of objectives, I said in Committee that the Government’s overarching objectives from the disposal of shares is to secure the future of the universal service and to ensure that we negotiate the best deal for both Royal Mail and the taxpayer. However, I appreciate that Parliament will want confirmation of these objectives once a decision has been taken to dispose of shares. This amendment will ensure that this is included in the report to Parliament made under Clause 2.

Moving on to employee shares, we understand the concerns of both Houses about the sort of scheme that will be put in place for employees, and I would remind noble Lords that the Bill already makes the strongest statutory commitment to an employee share scheme of any major privatisation. This commitment has been strengthened further by the Minister for Employment Relations, Consumer and Postal Affairs, who put on record in the other place that shares would be put into the scheme at the same time as the first disposal of shares. This commitment was repeated by my noble friend Lord De Mauley in Committee in this House. It is too early to commit to a particular scheme structure as this will depend on factors that are as yet undecided, such as the type of sale, but we have considered how we can provide additional comfort to both Houses. As the amendment sets out, we propose to place a specific duty on the Secretary of State to report on the details of the employee share scheme when shares are proposed to be put into it for the first time.

Finally, the amendment also ensures that the report will include details of the ongoing commercial relationship between Royal Mail and Post Office Ltd after the proposed disposal of shares in Royal Mail. We hope that this amendment will address the concerns expressed by several noble Lords in Committee, in particular the noble Lord, Lord Whitty, and his colleagues on the Front Bench. It will also work in tandem with Amendment 50, which we will discuss later, to ensure that information on the relationship between the Post Office and Royal Mail continues to be publicised in the Post Office’s annual report, as required under Clause 11.

Perhaps it will be helpful if I provide a little more detail about what we expect the reporting requirement will provide in practice. We envisage that the details published will be akin to those which a listed company might provide in relation to a material contract when issuing a prospectus offering shares to the public. This provides a fine balance between ensuring that the public—in that example, potential investors—have sufficient information and making sure that no commercially damaging information is inadvertently disclosed. In practice, the information is likely to include much of that which the noble Lord, Lord Whitty, seeks to include in Amendment 7. The contract has yet to be finalised. It does not need to be finalised until the two companies are formally separated prior to completion of a Royal Mail transaction, but negotiations are under way and we would expect a new contract to be ready to be signed by next spring.

Noble Lords will already be aware that Royal Mail and the Post Office management have committed that the contract will be for the longest legally permissible duration. I would hope that this could be for the 10-year period that noble Lords opposite have sought, but the final duration will depend upon interlinked factors such as volume commitments or exclusivity arrangements. Since the contract has yet to be finalised, the specific details required under Amendment 7 are impractical. For example, it would most likely be impossible to provide accurate annual total contract values to the Post Office as these are likely to depend on the volume of mail and parcels handled over Post Office counters during the relevant years. That is certainly the basis of the current arrangement.

I turn now to Amendment 8, which would require the Secretary of State to include in the report that he has to make under Clause 2 a risk assessment of the proposed disposal and information on due diligence made of the purchaser, along with a comprehensive analysis of the due diligence work. As I have said before, the Government’s intention is that a sale of shares will help to secure the future of Royal Mail, and this in turn will help the company to continue to provide the universal postal service. We will, of course, assess the risks and carry out appropriate due diligence as part of that process. The report in Clause 2 is required when the Secretary of State has made a decision to undertake the disposal of shares in Royal Mail, and the report must include details of the kind of disposal. The process of a disposal is unlikely to have begun and so the information set out in the amendment would not be available at the time of the report.

As I said in response to Amendment 5, we expect that after a sale had completed both the National Audit Office and the Public Accounts Committee in the other place will wish to review the sale process. They would look at the process that was conducted prior to a sale, including the risk assessments and the due diligence. This is recognised as standard parliamentary process to assess whether the Government have achieved value for money for the taxpayer. I certainly expect that process—that is, the work of the NAO and the PAC—to cover work undertaken by the Department for Business to assess the financial and other risks associated with the buyer because they can directly impact, in the longer term, the taxpayer. We do not believe that Amendment 8 reflects the nature of the reporting requirement in Clause 2, which is to report when a decision is taken to undertake a disposal—not on subsequent activities prior to a sale. We also believe that there are existing parliamentary processes in place to scrutinise risk assessments and any due diligence that has been undertaken.

With the assurances that I have given to the House about what the Secretary of State will intend to include in a Clause 2 report, I hope that the noble Lord, Lord Whitty, and the noble Lords, Lord Clarke and Lord Christopher, will feel able to withdraw their amendments at the appropriate time. I beg to move.

Amendment 7 (to Amendment 6)

Moved by

--- Later in debate ---

[Lord Young of Norwood Green]

My Lords, we welcome the amendment moved by the noble Baroness, Lady Wilcox, and believe that it is a step in the right direction. The question is whether it goes far enough in that direction. We welcome the Government’s acceptance of the kind of information that ought to be made available before Royal Mail is sold. We have already stated that there are still many unanswered questions about the disposal—the timetable, the qualification of the future owner, the nature of the sale, how value for money will be secured, the danger of asset-stripping, safeguards for the universal service, and safeguards for the post office network. Yet the scope that is being given to the Secretary of State to make the sale is still very large indeed, with only a factual report to Parliament.

There is a significant improvement in the scale of information that is being offered, but it is certainly not the whole answer. I listened carefully but I did not quite get the assurance given on the nature of the contract between Royal Mail and the Post Office. I would welcome the Minister, in responding, clarifying the point that she made about next spring, when this contract is likely to be signed, and saying how strong the guarantee is on the 10-year period. Is it still just a hope, and are there still likely to be legal barriers to the 10-year period being a part of the contract?

I want to speak to Amendments 7 and 8. The House will be aware that we have consistently put the case for a long-term agreement between Royal Mail and the Post Office, to run from point of sale. We have proposed a 10-year duration. As my noble friend Lord Whitty said, it is certainly not an academic issue; it is a matter of commercial survival. The Government’s assurances are an improvement but still fall short of the commitment that we seek. I have no doubt that we will continue to return to this issue until we get a satisfactory assurance.

My noble friend Lord Whitty’s amendment provides a useful elaboration of the information that we seek, including the contract length, any contractual break period and the total value of the contract to Post Office Ltd. We urgently support his amendment and urge the House to do so.

Amendment 8 seeks further guarantees, and important ones, on the risk assessment of the proposed disposal of Royal Mail. My noble friend Lord Christopher rightly seeks confirmation that due diligence of the prospective buyer has been undertaken. These are sensible steps to take before such an important transaction, and I thought that his graphic and interesting description of the Netherlands postal system was an important contribution to this debate.

Once again, we support this amendment.

[Baroness Wilcox]

My Lords, I rise to respond to the noble Lords, Lord Whitty, Lord Christopher and Lord Young, on my amendment and the other two amendments. In response to the concerns expressed by the noble Lord, Lord Whitty, about the details to be provided in the Clause 2 report, I reiterate some of the sentiments I mentioned earlier. The information that we propose to include in the report includes much of the information that the noble Lord seeks in his Amendment 7. I would hope that the contract’s duration would be for the 10 years that many noble Lords are seeking, but the longest legally permissible duration will depend on other factors, such as volume commitments, which must be commercially negotiated between the companies. Finally, we must not require in Clause 2 the disclosure of information that might inadvertently damage the commercial interests of either business. That would damage the commercial sustainability of the post office network, which I am sure is not the noble Lord’s intention.

The noble Lord, Lord Christopher, raised a number of important points about how the postal service is provided in the Netherlands. I believe that these are consequences of the regulatory framework in the Netherlands, not of the ownership of its postal companies, but we will come to those matters when we debate Part 3 of the Bill, and I hope I will be able to provide him with further reassurance then.

The noble Lord, Lord Young, asked me to clarify what I said about the timing of a new contract between Royal Mail and the Post Office. As I said, negotiations are under way, and we expect a new contract to be ready to be signed by next spring. I hope that with those reassurances the noble Lord feels that he can withdraw his amendment.

[Lord Whitty]

My Lords, I appreciate that the noble Baroness has gone some considerable way. However, from what she just said it is clear that the information that the Government envisage in the report is on potential investors and the financial viability of both halves. There is a bigger public interest issue here. The post office network, which is so dear to many of our communities, depends on this agreement for one-third of its income. Unless this Bill spells out that part of the report to Parliament will cover something like the details that I have in my amendment, I do not think that the Government will be bound to provide a sufficient report on which Parliament can judge. Therefore, I would like to test the opinion of the House.

--- Later in debate ---

[Lord Young of Norwood Green]

My Lords, I also support Amendment 9 in the name of my noble friend Lord Kennedy. It asks that the report should include information about how the name of Royal Mail is to be protected and used by the universal postal service provider. I listened with interest to the noble Lord, Lord Jenkin, when he mentioned the value of the brand. We should remind ourselves that it was not that many years ago that the dreaded Consignia reared its head. Nobody understood why such an appalling name was chosen. It received no public understanding or acclaim, but no doubt the consultancy did quite well out of it. There is a bit of previous in this respect, which is why my noble friend Lord Kennedy was absolutely right to draw this aspect to our attention.

I will deal also with Amendment 54. As others have said, the House will agree that we owe a debt to my noble friends Lord Clarke and Lord Christopher, who deserve enormous credit for persuading the Government to bring forward this amendment, which will require the Post Office to tell us in an annual report how these collections are being looked after. I also pay tribute to the enthusiasm of the noble Lord, Lord Boswell, in his support for this. He made the point about ensuring that the collection is on public display and adequately resourced. While we welcome the amendment, producing a report is not the same as making sure that the heritage is taken care of. However, it will certainly concentrate minds and provide a degree of transparency that was not in the original Bill. Again, I congratulate my noble friends Lord Christopher and Lord Clarke, and the Government for listening to their case, which we welcome.

We also support Amendment 55, which would improve the government amendment by requiring that the report include details of donations, both in money and in kind, from Royal Mail to the British postal museum and the Royal Mail archive. I hope that the Government feel able to take another positive step in this direction by supporting the amendment.

[Baroness Wilcox]

My Lords, I will respond to the amendment of the noble Lord, Lord Kennedy, and then move on to Amendment 54 and also respond to Amendment 55 at the same time.

I said in Committee that I fully appreciate the sentiment behind the amendment of the noble Lord, Lord Kennedy, and understand why he seeks reassurance that the Royal Mail name will be preserved. However, the name of the company that delivers the universal postal service should be a commercial decision for that company and its shareholders. As the noble Lord, Lord Kennedy, said in Committee, Royal Mail is a great brand name. My noble friends Lord Jenkin of Roding and Lord Boswell have agreed. The commercial reality is that any owner will see this name as an asset. It is instantly recognisable in the United Kingdom in relation to the provision of the universal postal service. As a brand it is up there with Coca-Cola and McDonald’s—brands and goods that your Lordships might not necessarily purchase but will no doubt recognise.

I have heard what has been said about companies doing daft things. I agree that this can happen, but it is very rare for any company completely to abandon its leading brand. For example, there has been much discussion of the decision by the Post Office corporation in 2001 to change its name to Consignia once its operations were transferred to a public limited company. With hindsight, all involved—Parliament and the general public—saw this as a poor decision. However, even in this situation the brand name Royal Mail was not abandoned, nor was Parcelforce or the Post Office. These brand names continued to be used in all customer-facing operations, regardless of the name of the top company. A similar example is Centrica’s continued use of the brand name British Gas. To all intents and purposes, the public-facing side of the business in the United Kingdom is British Gas. This can be seen in its advertisements in newspapers and on television. I have listened carefully to the points raised in the debate today but I am not persuaded that it is necessary to include in primary legislation a requirement for a company to be called a particular name after a privatisation. This would not be good use of the legislative process.

--- Later in debate ---

[Lord Brooke of Sutton Mandeville]

The following line is not totally transparent:

“Before preparing the report, the company must consult any Post Office company”.

Consultation can take a wide variety of forms. Could the Minister give your Lordships’ House some idea of what kind of consultation she envisages?

[Baroness Wilcox]

I will get a note and come back to that. I will continue with my point for the moment. Amendment 55, tabled by the noble Lords, Lord Clarke and Lord Christopher, would amend Amendment 54 to require the Royal Mail company’s report to include details of financial support, both in cash and in kind, for the museum collection and its archive. In tabling Amendment 54 we have not been prescriptive about what should or should not be included in the report. As I have said, we fully expect a Royal Mail company to continue to recognise the importance of its heritage. How it chooses to support the museum and archive will be a matter for the company. However, any support that it gives to the museum and archive will be an intrinsic part of its activities, and it follows that the report will include these details. It is not, therefore, necessary specifically to include this requirement in the new clause.

The Government want to see the heritage of Royal Mail preserved. Amendment 54 provides the right balance and places a sufficient spotlight on Royal Mail’s activities to ensure that the Government and Parliament have the opportunity to scrutinise those activities, and for Royal Mail to demonstrate its ongoing commitment to its heritage. I hope that your Lordships will be able to support Amendment 54. I ask the noble Lords, in view of the reassurances that I have given, kindly to withdraw Amendment 9 and not to move Amendment 55.

[Lord Kennedy of Southwark]

My Lords, I thank all noble Lords who have spoken in the debate. I also thank the Minister for her response, although it was disappointing. My amendment does not seek to affect the disposal of Royal Mail; it seeks merely to protect the name. I will not press the amendment to a vote, but the Government have taken an unnecessary and risky decision. I hope that they are right, but if they are proved to be wrong a tragedy will result which could so easily have been avoided. I beg leave to withdraw the amendment.

--- Later in debate ---

[Baroness Wilcox]

I turn first to Amendment 14. As I said earlier, Ofcom will be required to report annually to the Secretary of State on its activities, including the provision of the universal service, and the Secretary of State is required to lay this report before each House of Parliament.

In performing all its duties—those in this Bill and those in the Communications Act 2003—Ofcom must have regard to various areas and groups as set out in Section 3(4) of the 2003 Act. These include: the needs of persons with disabilities, of the elderly and of those on low incomes; the opinions of consumers in relevant markets and of members of the public generally; and the different interests of persons in the different parts of the United Kingdom, of the different ethnic communities within the United Kingdom and of persons living in rural and in urban areas.

That list covers all the groups set out in the amendment tabled by the noble Lord, Lord Low, and I hope that he will be reassured by that. As I said in Committee, those requirements on the performance of Ofcom’s duties will apply to all future regulation of the postal sector. That is far more enduring than a snapshot assessment at the time of a sale.

The noble Lord, Lord Low, mentioned the power in Clause 33 to amend the minimum requirements of the universal service. We will come to that power when we discuss amendments to Part 3, but I know now that the power in Clause 33 is subject to the affirmative procedure.

On Amendment 15 in the name of the noble Lords, Lord Rogan and Lord Laird, to which the noble Lord, Lord Rogan, spoke this evening, I reiterate what I said in response to a similar amendment laid by the noble Lord, Lord Touhig, in Committee. The overarching objective of the Bill is to secure the universal postal service in the United Kingdom. It is about securing a postal service that is available to all in the United Kingdom and delivers to all addresses in the United Kingdom.

As I said in Committee, the Government have already produced an impact assessment on the Bill’s proposals. The assessment considered the impact of the proposals on all parts of the United Kingdom, together with the impact on small firms, rural communities and disadvantaged groups.

As I said earlier, Ofcom will report annually on its activities, including ensuring the provision of the universal service throughout the United Kingdom. In addition, we expect Royal Mail to continue to report on its quality of service performance, broken down by postcode area, so that there continues to be transparency about the provision of the universal postal service to all parts of the United Kingdom.

With regard to post offices, the Government recognise the need for accessibility by specific groups. The report by a Post Office company required by Clause 11 must include information about that. Clause 11 also requires that the Secretary of State give a copy of the report to Ministers in the devolved Administrations, as well as, of course, laying the report before this Parliament.

The information that is already in the public domain and that which will be provided as a result of the Bill will provide long-term transparency on the protection of the universal postal service and the accessibility of post offices throughout the UK. Those reports and the activities of the regulator will, as I have explained, take into account the needs of disadvantaged groups and those in rural areas.

I hope that, with these reassurances, the noble Lord will withdraw his amendment.

[Lord Rogan]

My Lords, I thank those Members who have spoken to my amendment. I have listened to the Minister and thank her for her remarks. I beg leave to withdraw the amendment.