Post Office Network

Debate between Andrew Stephenson and Nia Griffith

Tuesday 2nd November 2010 Westminster Hall

[Nia Griffith]

Indeed. The hon. Lady makes reference to the important role of post offices in rural communities, but those very post offices are the ones that would be most threatened if the inter-business agreement were not in place. It is absolutely vital, as the National Federation of Sub-postmasters suggests, that we have some sort of 10-year agreement to guarantee that business.

Proceeding to privatise Royal Mail without such guarantees for Post Office Ltd would also call into question the wisdom of investing considerable sums of taxpayers’ money in a business that had no chance of being viable—a bit like redecorating flood-prone properties without shoring up the flood defences. It is not sufficient for there to be vague assurances and assumptions that somehow Royal Mail would automatically choose Post Office Ltd for its counter services. No astute business person would be satisfied with anything less than protection through written contracts and legislation. The Postal Services Bill does not provide that protection, and the Opposition will be tabling amendments that would provide Post Office Ltd with the necessary certainty that a privatised Royal Mail will continue to use the post office network for its counter services.

It is very worrying to hear the National Federation of SubPostmasters report that the Government are very resistant to its requests for the guarantee of a 10-year agreement. That is no way to treat sub-postmasters who have invested considerable sums of their own money in the local post office network, and it will certainly not encourage new entrants to take over when sub-postmasters retire. That is one area in which the Government can, and should, take action to safeguard the third of Post Office income that derives from Royal Mail.

Furthermore, one in seven rural post offices provides premises, facilities and supervision for Royal Mail delivery staff. Sub-postmasters running the 900 mail-work post offices are paid according to the number of postmen and women they supervise. That pay is frequently about 25% of the income of such post offices. They need a guarantee that the income will continue. There is no guarantee that a privatised Royal Mail, quite possibly owned by foreign interests, would honour or renew the inter-business agreement, and without determined Government action in that respect post offices will lose their core business.

In addition, we need to know what other specific proposals the Government have to increase footfall in our post office network. As I have said, all businesses need to attract new customers and identify new services that will interest their customers. One notable success story is that post offices have become major suppliers of foreign currency.

[Andrew Stephenson (Pendle) (Con)]

: The hon. Lady is setting out a fantastic case as to why the post office network is vital, so will she briefly explain why her Government closed down 7,000 branches?

[Nia Griffith]

I have just explained why we put in money to ensure that 7,500 branches, in addition to the 4,000 commercially viable ones, were in fact kept open. The crucial issue we all have to address, and on which we need answers from the Minister, is how to make those post offices viable so that, in the words of some of the hon. Gentleman’s colleagues, the subsidy is not needed for ever and at the end of the day there is a viable business that can survive, and provide the network that we all want.