Oral Answers to Questions

Ed Davey Excerpts

Thursday 18th November 2010 Commons Chamber

[Bob Blackman (Harrow East) (Con)]

2. What his Department’s policy is on the future of the post office network.

[The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Mr Edward Davey)]

The Government set out their policy for the future of the post office network in a statement entitled “Securing the Post Office Network in the Digital Age” published on 9 November. Copies of the statement are available in the Libraries of the House and are accessible on the Department for Business, Innovation and Skills website.

[Bob Blackman]

I am sure that the whole House will welcome the arrangements between the Royal Bank of Scotland and the Post Office to enhance the capability of post offices, the vast majority of which, of course, are run by individuals as part of a wider business. What further plans does my hon. Friend have to enhance the post office network, rather than close it, as the Labour party did when in government?

[Mr Davey]

My hon. Friend is right to welcome the deal between RBS and the post office network. It means that nearly 80% of current accounts from the bank can now be accessed through the network, and we hope that that will be increased in due course. That is just one of the many policies set out in our policy framework so that we can ensure that the post office network does not suffer the major closure programmes we saw under the Labour party. I am sure that he will welcome the statement we made.

[Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)]

Does the Minister understand people’s concern that he has not chosen to go ahead with a separate Post Office bank? Will he say how he intends to ensure that small sub-post offices in villages will be able to offer a wider range of services to our constituents?

[Mr Davey]

We looked in some detail at the case for a state-backed Post Office bank. The cost of a banking licence would have been in the realms of the amount of money we are putting into the post office network to modernise it and to prevent a closure programme. I am sure that the hon. Lady welcomes the £1.34 billion of investment in the post office network. That, along with the policies we set out in our policy statement to get more Government revenue through the post office network, and to tie up arrangements with banks such as RBS and the post office network, is the surest way to ensure that the post offices in the villages she talked about have a long-term viable future.

[Damian Hinds (East Hampshire) (Con)]

The Government are keen to promote closer working between post offices and credit unions. Will the Minister seek ways to facilitate robust back-office arrangements between the two, which would be a good and cost-effective way of improving financial inclusion?

[Mr Davey]

I think the hon. Gentleman is quite right to point to the important role that credit unions can play and the potential for work between them and the post office network. As we said in our statement, there are already initiatives and pilots to see whether there is room for expanding the role of partnership work between the post office network and credit unions. I look forward to seeing the results of those pilots. The points made about a longer-term relationship are well made, and we are certainly looking at that.

[Hywel Williams (Arfon) (PC)]

There is real disappointment in small rural communities such as the ones that I serve at the Government’s announcement on the Post Office bank. What reassurance can the Minister give me that services through small local post offices will be maintained, or preferably improved?

[Mr Davey]

I am not sure whether the hon. Gentleman has read our Post Office policy statement. I would have thought that he welcomed the fact that the measures we are taking are encouraging banks such as RBS to make their accounts available through the post office network in the towns and villages that he represents. I think that there is a much more positive future than under the previous Government and that is implicit in his question.

[Charlie Elphicke (Dover) (Con)]

3. What recent discussions he has had on the future of local enterprise partnerships; and if he will make a statement.

--- Later in debate ---

[Richard Graham (Gloucester) (Con)]

19. What his Department’s policy is on the future of the post office network.

[The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Mr Edward Davey)]

I refer my hon. Friend to the answer I gave to the hon. Member for Harrow East (Bob Blackman) earlier.

[Richard Graham]

I am grateful to the Minister. Earlier this summer, the sub-postmaster at Quedgeley in my constituency of Gloucester decided to close his franchise because he could not see enough ways of making the business profitable. Can the Minister confirm that his plans for increased access to Government services, banking services and credit unions will help reverse the disastrous trend under the last Government of spiralling decline and closure, and instead enable sub-postmasters to make their businesses profitable again?

[Mr Davey]

That is exactly right, and I pay tribute to my hon. Friend both for his work as secretary to the all-party group on post offices and for his work in finding a new sub-postmaster for Quedgeley. Our policies include not only our £1.34 billion of investment in the post office network, but our efforts to ensure that, through the pilots that we have announced, Government services provided through the post office network will increase, rather than decline.

--- Later in debate ---

[Nigel Mills (Amber Valley) (Con)]

T7. Will the Minister agree to meet a social enterprise in my constituency whose future is threatened by the draconian attitude of RBS, which seeks nearly £400,000 in penalties for a minor breach, even though a non-nationalised bank is willing to refinance its loan fully?

[The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Mr Edward Davey)]

The Government are keen that banks should behave responsibly towards businesses, charities and social enterprises, and we continue to work with the banks to achieve that. For example, we are working with them to revise the lending code for micro-enterprises and we are publishing lending principles for medium-sized and larger businesses. We will continue to hold banks to account when they act unreasonably, and my officials will raise this matter with RBS.

[Angela Smith (Penistone and Stocksbridge) (Lab)]

In a letter that I received this morning from the Secretary of State, I was told that the funding for AgustaWestland

“has been provisionally allocated under the capital budget of the department over the Spending Review period”,

whereas the Sheffield Forgemasters loan was cancelled in June because its funding had been allocated during the current financial year. I thank the right hon. Gentleman for the speediness of his response, but as the Forgemasters loan was the only BIS investment that was dropped in June, why can it not be picked up again and allocated in the period of the forthcoming spending review?

--- Later in debate ---

[Julian Smith (Skipton and Ripon) (Con)]

May I plead with the employment Minister and his boss to delay the implementation of flexible working, shared parental leave and the expansion of legislation on the right to request training, in order to give British business a holiday from new employment legislation in 2011, and allow it to focus on job creation and growth?

[Mr Davey]

I may be about to disappoint my hon. Friend, because he will know that the coalition has some very expansive plans to promote the right to request flexible working for all employees, and to develop a new system of flexible shared parental leave. We believe that when we publish our plans and consult on them in the new year, he, and many businesses, will see that they are actually ways to promote business growth and enterprise.

[Kevin Brennan (Cardiff West) (Lab)]

We have learned this week from the papers that the Secretary of State is participating in the “Strictly Come Dancing” Christmas special. [Hon. Members: “Hurrah!”] Does that mean that his policy towards business and the economy is “Slow, slow, quick, quick, slow”?

[Margot James (Stourbridge) (Con)]

I understand that Lord Young is examining the impact of employment law on the growth of small business. Will my hon. Friend work with Lord Young to identify whether there are ways of modifying employment law for small businesses, particularly those that are family owned, and employ small numbers of people?

[Mr Davey]

I have already met Lord Young to discuss his review, and I will be working with him. The House will want to pay tribute to Lord Young for his award yesterday as peer of the year.

[Mr Adrian Bailey (West Bromwich West) (Lab/Co-op)]

I welcome the commitment, given by the Under-Secretary of State for Business, Innovation and Skills, the hon. Member for Wantage (Mr Vaizey), in response to my first question, to setting up structures to access European regional development funding. Will the Minister confirm that money will be available to get the projects together to do that?

[Gordon Henderson (Sittingbourne and Sheppey) (Con)]

In my constituency, small businesses have historically been able to visit our local Crown post office to collect their mail early in the morning. Now the Post Office has informed those businesses that in future they will have to pay £225 per month if they want to collect their post before 8.30 in the morning. Will my hon. Friend encourage the Post Office to drop that additional burden on small business?

[Mr Davey]

As my hon. Friend knows, such issues are operational matters for the management of Royal Mail, but I will certainly raise that matter with them.

[Valerie Vaz (Walsall South) (Lab)]

May I press the Minister on when exactly he spoke to the Department of Health about forgivable loans for medical students?