Postal Services Bill
Debate between Ed Davey and Ian Davidson
Mr Davey
I expressed my disappointment that Post Office Ltd did not win that contract from the Department for Work and Pensions, but I have described three pilots on which the DWP is working with Post Office Ltd. I could also have talked about the proposals on credit unions that we hope will go forward, or the fact that Post Office Ltd has won a contract with the London boroughs so that local authority staff can have an authentication service at the local post office. If that scheme develops, it might have applications throughout the country. Such developments have been welcomed by the National Federation of SubPostmasters, but of course we want to go further, which is why we are so pleased to have persuaded the Royal Bank of Scotland to enable its customers to access their bank accounts through the post office network, which we believe will start to happen from September. I would have thought that the hon. Lady would welcome such developments.
Mr Ian Davidson (Glasgow South West) (Lab/Co-op)
If such developments arrive in the future they will be welcome, but will the Minister return to the point about the green giro? Do we have joined-up government? This was an opportunity to boost the Post Office, so why did the Government not do something about it? Surely the Minister, as a Liberal, will not just blame European regulations.
Mr Davey
I certainly would not—but when Labour Members make such points they really have a cheek, because their Government removed more than £300 million of Government services from the post office network. We are working hard across the Government to ensure that we can position Post Office Ltd in a place from which it can win contracts from Government Departments in Whitehall and local authorities to deliver the front office of government. I can tell the hon. Gentleman that a huge amount of work is being done on this, and he needs to be a little patient.
The problem is that when we came into government and developed the strategy, the cupboard was bare because the previous Government had done almost nothing. They had allowed the post office network and the process for developing new business to wither on the vine because they were so busy closing 7,000 post offices. I have to tell Opposition Members that the tender for the green giro began under the previous Government, so they really ought to be careful. We have had to deal with the tender that Labour Ministers wrote.
Mr Davey
We need to have flexibility in the legislation to ensure that if the circumstances are so bad for Royal Mail because technology is having a worse effect than we had expected on its letter flows, we can still provide the universal service. That is what this Bill is about. This extra flexibility ensures that if an unforeseen circumstance arises requiring an unfair burden review before the five years is up, that flexibility is in place. I am glad that the hon. Lady welcomes that.
I was grateful for the comments made by my hon. Friend the Member for Solihull (Lorely Burt), who acknowledged that these amendments show that the Government have listened. She was concerned that amendment 19 would give the Secretary of State an override. May I assure her that we think it very unlikely that the power would be used? We need to make it clear that the first step is for Ofcom to assess the needs of users, and it will consult the public. We would not expect to use the power, and it is highly unlikely that we would interpret the “interests of the public” as being less important than the “needs of the public”. The words in the amendment should reassure her. The amendment is intended as a broader test to capture elements that the “needs of the public” do not, and that Ofcom is not allowed to consider. I hope that she will be reassured by that.
My hon. Friend also asked about the notification scheme. I assure her that it is designed to enable Ofcom to act to prevent harmful cherry-picking, which would damage the universal service. Again, this is another tightening up of part 3 and the regulations, to ensure that we can deliver the universal service through this Bill.
The hon. Member for Dunfermline and West Fife (Thomas Docherty) talked about what happened in his constituency following the bad weather just before Christmas, and asked me whether I talked to Royal Mail about it. Of course I regularly meet the management of Royal Mail, and they are committed to providing an excellent service. I think we all accept that the conditions last winter were exceptional and did create lots of problems. Royal Mail took exceptional measures to try to deal with them, including investing £20 million of extra resources to ensure that deliveries could be maintained. Although the details of Royal Mail’s operations are, of course, a matter for Royal Mail, it is worth pointing out that in areas of Scotland, including his constituency, the private companies had much greater problems in delivering. Royal Mail acted strongly, made the investment and was able to deliver. As the universal service provider, it showed its strength.
Mr Davidson
Does the Minister believe that that additional expenditure—that enormous cross-subsidy to the highlands and other isolated areas of Scotland—would have happened in an independent Scotland?
Mr Davey
Mr Deputy Speaker, I would love to speculate on such a matter, but Madam Deputy Speaker has made it very clear that she would not wish us to do so. All I can suggest to the hon. Gentleman is that he might wish to debate that later with the hon. Member for Angus (Mr Weir) in order to get an answer to his question. He should not believe everything he hears.
Postal Services Bill
Debate between Ed Davey and Ian Davidson(13 years, 3 months ago)
Commons ChamberRead Full debate Read Hansard Text
Mr Davidson
No, I do not agree with that at all, because I do not believe that a structure will be established for Royal Mail that necessarily allows all shareholders to come round and cast a collective vote on whether they want to maintain a collective post office network. It will be in the management’s interests to maximise the return for the shareholders, so screwing the post offices into the ground will probably be in their interest. I am sorry if my comparison about ham and eggs, and chicken and bacon was not understood. The concept is that the pig provides the bacon, and the chicken provides the eggs. The chicken can carry on afterwards, but it is not quite as easy for the pig. I am sorry if that is beyond senior members of the Conservative party, but we are prepared to explain these things to them later.
Returning to the question of how we can secure the strongest possible commitment to the IBA, as proposed in the new clause, which the Committee had not seen when it prepared its report, we thought that having that in legislation would be an extremely strong protection. If the Minister can give us an assurance that legislation is not necessary because the same things will be achieved without legislation before there is any question of a sale, then, because we are reasonable, we would be satisfied. However, the House will understand our anxiety, because after the by-election on Thursday, the Minister might not be here any longer. We want to make sure, while he is in a position of authority, that he allows his heart to rule and produces measures that we find acceptable.
I should like to touch on one or two other worrying issues relating to the Post Office. On the size of the network in Scotland, we accept that the Government’s access criteria are helpful in setting out the structure of the network that they want. We welcome, too, the fact that they intend to keep 11,500 post offices. However, it is not the case that the access criteria necessarily mean that the 11,500 will remain, because our understanding is that the access criteria could be met with 7,500 post offices. A commitment to 11,500 is not necessarily a commitment to the 11,500 that are there at the moment. It would be possible in those circumstances for a substantial denuding of the post office service to take place in the highlands, the islands, the borders or Argyll. Rural areas could maintain the present access criteria, and the 11,500 criterion could be met because other post offices might set up elsewhere in urban areas, but the service would undoubtedly be worse than it was before.
The Minister shakes his head. I would welcome a commitment from him that the intention is to maintain the network pretty much as it is. I genuinely understand his difficulty. Individual post offices are controlled by individual private contractors. We cannot legislate to refuse somebody permission to leave. There will always be some degree of coming and going. If it were one in, one out in a particular area, we would not object to that, but there could quite easily be a couple of hundred post offices going out of the rural areas or the poor areas, and a couple of hundred starting up in the richer areas where need is perhaps less. The Minister’s criterion would still be met, but the social objectives that we are pursuing would be lost. I am happy to give way if the Minister wants to solve my problem.
Mr Davey
Philately has got me to my feet. I am looking forward to reading the Scottish Affairs Committee’s full report. I thought that I had said to the Committee that the 11,500 commitment is in the contractual agreement between the Government and Post Office Ltd. That is a strong commitment and it is backed up by the access criteria that we inherited from the previous Government, which could be delivered by a network of 7,500 post offices. Obviously, there is a debate about that, but the two together give a strong reassurance to Members and to communities around the country and meet all the concerns that the hon. Gentleman is raising.
Mr Davidson
The Committee unanimously welcomed the points that the Minister was making about the access criteria and the fact that he was guaranteeing, as I understood it, 11,500 post offices, but surely he will accept that his guarantee does not guarantee the same 11,500. It does not guarantee them in the same locations. In some areas, particularly rural areas, where there are small post offices, the access criteria are, thankfully, better met. One of those could easily close, one could open somewhere else, such as London, and both sets of criteria would still be met.
If the Minister cannot give us a commitment today, perhaps he will take that away and consider whether something could be done at a later stage in the passage of the Bill. I think that he accepts that this is a genuine anxiety and that we are here to help him. We are identifying gaps in provision and trying to strengthen the Bill.
Mr Davey
My right hon. Friend is absolutely right. Let us be absolutely clear: the problem with Royal Mail has been the inaction, particularly from the previous Government, that has led to its parlous state. We do not want to create significant risks of legal challenge that would undermine the modernisation and investment process that Royal Mail needs to deliver on the universal postal service and that we need to ensure that the post office network does not have to face the closure programmes we saw under the previous Government.
Mr Davidson
Could we possibly agree, first, that the EU is a bad thing? Secondly, is the Minister telling us that he does not wish to have the new clause in the Bill in case the EU steps in, while also promising us that he is going to do all this anyway?
Mr Davey
The commitment that I have given today is what the hon. Gentleman and his Select Committee were seeking. That is what I understood from his very well-informed remarks earlier. Now that he has intervened, let me tell him that his point about mobile vans is dealt with in Government amendment 5, which I hope we will get to. There are currently 39 such vans serving 240 communities, and Post Office Ltd has no plans to increase its fleet of vans. I hope that gives him some reassurance on his very detailed point.
Mr Davey
Let me anticipate the hon. Gentleman, because the concerns that the nationalist parties expressed in their amendments are unfounded. The Bill will ensure that nationalist emblems can be placed, and be required to be placed, on stamps in future. I hope that he is reassured by that.
Mr Davidson
Surely the Minister does not mean “nationalist emblems” can be placed; can he assure us that Alex Salmond’s head will not appear on any stamps provided in Scotland?
Mr Davey
I cannot tell the hon. Gentleman how delighted I am to be able to give him that reassurance. It was a slip of the tongue.
Some people have concerns about the wording of our amendments, which ensure that Her Majesty’s head will be on our stamps in future. I can assure hon. Members that, under section 10 of the Interpretation Act 1978, “Her Majesty” can be taken as
“a reference to the Sovereign reigning at the time of the passing of the Act”
and construed as applying to any future Sovereign, so people should not worry about that.
May I turn to the Post Office? There has rightly been a lot of debate about the impact of the Government’s proposals on the network of post offices. First, I want to be absolutely clear that we are talking about a sale of shares in Royal Mail, not in the Post Office. They are both cornerstones of British life, but they are different businesses facing different problems, and that is why separation has been so widely supported by the experts. Of course, their futures are closely linked, and we expect that they will always have a strong commercial relationship, but securing the future of Royal Mail will of course help to secure the future of the Post Office as the natural outlet for purchasing Royal Mail services.
I shall say again something that I have said many times before. There will be no programme of post office closures under this Government. I have been very clear on that, as has my right hon. Friend the Business Secretary. That is why we have pledged £1.34 billion of funding to support the post office network, funding that will ensure the continuation of at least 11,500 post office branches throughout the United Kingdom.