Postal Services (Rural Areas)

Iain McKenzie Excerpts

Monday 2nd September 2013 Commons Chamber

[Katy Clark]

I suspect that that topic could be the subject of a lengthy debate. I do not want to stray too far from the terms of the motion, but hon. Members on both sides of the House have outlined fully in previous debates what needs to be done to ensure that post offices have a viable and successful future. The Government have a role to play in that. I call on parties on all sides of the political debate to do what they can, because we all have areas where we are in power and can ensure that post offices get more work and receive more support.

The overall package of pay and conditions of not only TNT staff in London but those employed on a similar basis by other private companies, which have been able to operate in such a way only since the 2011 Act was passed, is significantly worse than that of the Royal Mail work force. Ofcom is responsible for regulating the sector. It has explicitly stated that it is regulating TNT, but it has done nothing whatsoever about TNT either cherry-picking services or undercutting wages and conditions.

The fear is that this is the face of future postal services. Although TNT and others might wish to operate in London and other profitable areas, they will not be interested in many other parts of the country, such as North Ayrshire and Arran. Of course, that means that Royal Mail will not be able to use the money it makes in profitable areas to subsidise—to cross-fertilise—services in less profitable areas so that it can provide a national service. The Government say that they support the universal service obligation, as the hon. Member for Hereford and South Herefordshire (Jesse Norman) suggested in an intervention.

[Mr Iain McKenzie (Inverclyde) (Lab)]

I thank my hon. Friend for giving way. She has been extremely generous, and I congratulate her on securing the debate. Did she, like me, see in the fly-on-the-wall documentary TNT’s habit of calling its delivery people back before they had finished their day’s work, thus returning mail to the depot, so that it took longer for people to receive it? That is an ongoing practice, and it is encouraged.

[Katy Clark]

My hon. Friend makes an incredibly important point.

If we proceed down this path, the pressures on future Governments and the management of Royal Mail will be to reduce requirements, as they will need to compete on a level playing field with other service providers. They will have to ensure that the universal service obligation is financially sustainable. If we go down the path suggested by the Government, loss-making rural services will be the most vulnerable and will be the first to go.

I appreciate the fact that the Government say that the universal service obligation is enshrined in law, but that covers only the bare minimum. Many of the requirements are set by Ofcom and can easily be changed. The regulator has recently consulted on user needs, including getting rid of first-class mail and thus next-day delivery, and moving from a six-day to a five-day service. That may not happen now, but if privatisation goes ahead it is more likely. The privately run PostNL in the Netherlands has put pressure on both the regulator and the Dutch Government regarding the universal service obligation and there are now plans to drop Monday deliveries.

There is no guarantee that the inter-business agreement that has been entered into between Royal Mail and the Post Office will continue or remain unchanged at the end of the 10-year period. I do not believe that the protections that we have been offered are adequate, so I am asking the Government to halt the sale of Royal Mail to give proper consideration to how rural services can be provided in the longer term, and to put in place stronger legal protections for the universal service obligation. I believe that cross-party support for the motion reflects a genuine concern about the issue, and I urge the Government to look at the issue in detail, and to provide a detailed response today.