Post Office Network

Debate between Albert Owen and Gregg McClymont

Tuesday 2nd November 2010 Westminster Hall

[Albert Owen (Ynys Môn) (Lab)]

I apologise for having to leave during the previous speaker’s contribution, Mr Caton—it was probably the excitement of the previous debate. I congratulate the hon. Member for The Cotswolds (Geoffrey Clifton-Brown) on securing this important and timely debate, which follows the Government’s announcement last week.

I want to start by saying that I support the post office network, and I do so as a customer; I ensure that I pay all my bills across the counter at my local town post office. In doing so, I hope to set an example. As a Member, I ensure that all my office transactions are done in local post offices. As has been mentioned, it is wrong for Members to drive past post offices that are closing down and say, “Isn’t it a crying shame?”, before going to other outlets. We must lead by example in our communities if we are to keep our post offices.

The important business for post offices is not only from individuals, but from Government Departments and local government. The hon. Member for The Cotswolds rightly said that we need innovative business. One simple business transaction that local government could encourage council tax payers to undertake would be to pay their bills in local post offices. During the network change programme, I suggested that to my local council, because it was outraged that central Government were closing post offices. I challenged it simply to state on the notice that it sent to each household in my constituency that that service was available in post offices, but it refused to do so. Worse still, the chief executive said categorically that the council could save a lot of money by having people pay the bills electronically or in one-off payments.

I think that we are all in this together. We talk about the big society, and my Anglesey community has a big heart, but we do not need lectures on that from anyone. There needs to be interdependency and help from the public, private and third sectors, a point I will come to later. I opposed the network change programme’s closures because it was too rigid and came from the centre. I wish that the Conservative Opposition at the time had said that they would put money into that, but they did not commit themselves in the last Parliament to put in the subsidy, which is why I did not support the Conservative motion. I abstained, and people who know me know that I do not do that very often; if I think something is right I will vote for it, and if I think something is wrong I will vote against it. It was wrong of the Conservatives not to commit themselves to the subsidy, but the new Government have said that they will commit additional money to help the post office network, and I support that. It would be churlish not to do so. I think that that is important and must be sustained.

Echoing the comments of the hon. Member for Angus (Mr Weir), I am confused about the mutualisation programme. I support mutualisation. Indeed, I told the previous Secretary of State and the Minister responsible for the Post Office at the time that Royal Mail should be mutualised, because I believe that it is so special in the fabric of British society that it must be treated differently. It should be neither left to the laissez-faire approach and the free-for-all of the market, nor cushioned as it had been under previous management and Governments. I was told that mutualisation was the wrong model, but I do not think that Hooper looked at that model carefully enough. Welsh Water, for example, which operates in my constituency, is a not-for-profit organisation. It provides a universal, quality service in Wales, and all its profits are reinvested in the company for the benefit of the customers. That is the kind of model we need for Royal Mail. I hope that the Minister will give some details on the mutualisation for the post office network.

Ultimately, post offices are private businesses in the main. They are run by individuals who have invested their own hard cash, time and effort to provide a public service. They are private means. There are also the private subsidies from Government and, in the case of Wales and Scotland, a special diversification programme to help keep the businesses open, so there are three streams of investment to the post office business.

I wonder how the mutualisation will work and, if there is difficulty, how post offices will get help. There will be difficulty, because business is dropping as the pattern continues of people using mechanisation and electronic mail, which is taking over. There are big concerns, which I am sure the Minister will try to address, because it is important that people know now what will happen. I have friends who are postmen, sub-postmasters and in management, whom I work with, and they are all confused about that. We need clarity on that matter

[Gregg McClymont]

I want to add to something my hon. Friend has said. Our understanding from Post Office Ltd is that only about 4,000 of the 11,500 post offices now open are profitable. In addition to the public subsidy, Post Office Ltd cross-subsidises the loss-making post offices to the tune of £400 million. The Government subsidy is welcome, but we have to be clear that it really is an uphill task. Mutualisation will have to be tremendously successful to make up the shortfall for those 7,500 post offices.

[Albert Owen]

My hon. Friend is absolutely right, although it is not for me to answer on the Government’s proposals. I would like to see something developed along the lines of the people’s bank. I would like to see credit union activities in local communities, in which people will have a real say on what goes on.