Community and Sub-Post Offices

Douglas Ross Excerpts

Wednesday 27th March 2019 Commons Chamber

[Gavin Newlands]

I totally agree. The first thing that has to be done, though, is to increase the rates that make post offices viable in the modern age. I hope the Minister will take that step.

In 2018, sub-postmasters were far more likely to state their intention to close in the coming year than small businesses in general, with 22% intending to close or downsize their operation. Those with such plans overwhelmingly came from deprived areas. Sub-postmasters also face increasingly difficult working conditions, with often 40-plus hours being dedicated just to the post office side of their business and 27% of them working longer hours in 2018 than 2017. They average fewer than 10 days’ holiday each year, and one third took no time off whatsoever. They also face less take-home pay, with 61% taking home less in 2018 than 2017, 76% making less than the national minimum wage for hours worked and 19% of them or their partners taking on extra work to supplement their income.

Since network transformation, many post offices designated as local post offices, such as Kirklandneuk in my constituency, have had some services removed, such as Parcelforce services and passport services, which may otherwise cross-subsidise the lack of remuneration for banking services. Clearly that would be less of an issue were they simply paid a fair rate from the banks.

[Douglas Ross (Moray) (Con)]

Will the hon. Gentleman give way?

[Gavin Newlands]

I will give way if the hon. Gentleman promises to be brief, and I congratulate him on the birth of his child.

[Douglas Ross]

I am very grateful to the hon. Gentleman for that. I have done my bit for the Post Office recently, with the number of cards I have been receiving since the birth of my child—although perhaps 35 cards did not have a stamp put on them, because I have not had any from SNP Members so far, but I have had many congratulations, which I am grateful for.

I have raised this issue a number of times. We are fortunate that the director for Scotland for the National Federation of SubPostmasters, Paul McBain, owns post offices in Moray. An issue that comes up time and again is that the public are not aware of the wide range of services that are available in post offices. They know what was historically available, but much more is now available, and we need to promote that message, to encourage more of our constituents to use post offices rather than online services.

[Gavin Newlands]

I thank the hon. Gentleman for his intervention. That is certainly the case, and the survey bears that out; that is the belief of sub-postmasters. But at the end of the day, more customers going into a post office to use the services will just swamp it and perhaps make it an even bigger loss-making venture than it currently is. We need to sort the rates out as well.

Bridge of Weir post office, which I have raised in this place in the past, has serious concerns about its long-term financial viability. After making a small loss last year, it anticipates that the losses will continue to rise. All told, if this continues, it expects its accumulative losses over 10 years to reach £70,000, despite the centre being run almost entirely by volunteers, with just one paid member of staff in the post office.

When I previously raised the Bridge community centre post office, in asking the Leader of the House for a debate on this issue, I pointed out that despite being the textbook definition of a community institution—run by the community for the community, because no retailer would take up the franchise—it receives no community subsidy from the UK Government, and this is regrettable. Owing to the Government’s rules on distance to other retailers and to other post offices, it does not qualify for any support, but with a dose of common sense, this would be entirely avoidable.

Let us remember that no other Bridge of Weir retailer wanted to take this on. In addition, the Bridge’s other retail offerings—tea and coffee, cards, second-hand books—do not operate in competition with any other Bridge of Weir retailer. There is another post office within the three-mile limit, which also rules out community status. However, the community designation ignores local public transport links, which Bridge of Weir had gei few to start with, and recent cuts have eviscerated the village’s bus service. In addition, the next closest post office is a 10-minute walk from the nearest bus stop, meaning that access, even with an adequate bus service, is a huge issue.

This all said, I understand the need for community status criteria to be in place, but it is clear to me that we need to look again at these criteria, or to allow for common sense exceptions in places such as Bridge of Weir. The community subsidy is still vital as it supports many branches that might not otherwise be commercially viable. Under current plans, the Government subsidy to the post office is due to be cut in the coming year and to end entirely in 2021, but I would strongly urge the Minister to reconsider this.

The National Federation of SubPostmasters’ latest study found that, last July, 17% of community model branches were actually closed. This is alarming as they are potentially the very last store in a local area. The community subsidy is therefore letting many post offices fall through the net at the current rate, let alone with a further reduction or indeed its removal. This is not a promising outlook for the future of the post office network.

In too many of our small and rural towns, the local post office is often the last place where a face-to-face, human service is available. With such a wide array of duties—handling mail, banking, benefit administration and so on—it is understandable why the post office has continued to be such a vital lifeline to so many of our communities. I therefore urge this Government to listen to sub-postmasters to see what more they can do to support them in the short, medium and long term. They should not be afraid to stand behind the Post Office—let us not forget that we own it—and use their influence to ensure that it gets a fair and equitable deal with the banks that now rely on post offices to provide their services.

I urge the Minister to rethink the Government’s community designation to take into account local geography and factors such as public transport links in our communities. After speaking to my constituents, and I am sure that others in this place will have found the same, the current community designation leaves many community post offices—in practice, if not designation—out to dry. Indeed, the Minister must ensure that the community subsidy does not end in 2021. If indeed it were to end, I dread to think of the number of towns and villages left without a bank or a post office at all.

Given that the vast majority of the post office network is made up of sub-postmasters, we should be concerned when they tell us that they are overworked and underpaid, and most of all when they tell us that their financial futures are perilous. I hope the Minister will commit to meeting me to discuss this further.

The local post office has a revered position in our public life, standing through centuries of change, turmoil and political drama. It is important to note that times have changed, and the modern digital age has not been to the advantage of the post office. I only hope that we can maintain and protect a sustainable post office network for all our communities. The Government have a pivotal role in securing this vision, and I urge the Minister to listen to and to heed all the points raised by many Members in this short debate to ensure a secure future for our post offices.