Postal Services Bill
Debate between Jack Dromey and Fiona O'Donnell
Jack Dromey
I was just about to do so, Madam Deputy Speaker, but like the Minister, I embarked on some historical anecdotes, as the Post Office is very proud of its history.
There is a simple inescapable reality, which is that the Post Office is dependent on Royal Mail’s business. A third of its revenue—£334 million—and a third of sub-postmasters’ pay—£240 million—is generated by selling Royal Mail products and services. The Bill does not safeguard on a continuing basis the inter-business agreement. The Government will not undertake to extend the current five-year guarantee to 10 years. Key stakeholders recognise the importance of making a longer commitment on the IBA. Let me cite what Consumer Focus said in its evidence to the other place:
“There are few safeguards to keep that contract for the long term. It’s entirely conceivable—though it seems an odd thing to suggest—but several years down the line you could have a post office network where you cannot undertake mail transactions. It would be for Royal Mail to determine which operator—whether it was Post Office Ltd or Tesco or whomever—to offer mail services and there would be no requirement for stamps or parcels.”
It continued:
“You could see a scenario where Royal Mail looked to cherry pick so Tesco, say, could meet its requirements in urban areas and the Post Office would pick up the slack in rural areas where there isn’t anybody else. And that has very serious implications in terms of the viability and integrity of the network because urban areas typically make money.”
Consumer Focus went on to argue that the number of post offices could fall by 37% as a consequence of these measures—from the current level of 11,900 to the minimum number consistent with the Government’s access criteria of 7,500. In Birmingham alone, seven post offices face closure.
The National Federation of SubPostmasters has added its call to the need for action. It also argues for a minimum 10-year IBA. Let me quote what it says:
“The NFSP believes that in order to avoid further post office closures, existing levels of Royal Mail work at post offices must be maintained with a minimum 10 year IBA between the two companies following separation.”
The Government’s stance is clear, albeit sad. They have rejected a number of opportunities to make the commitments that have been called for.
Fiona O'Donnell (East Lothian) (Lab)
Is my hon. Friend aware of the recommendation in the Select Committee on Scottish Affairs report that the Government should be doing more to remove the barriers to local post offices providing services in relation to devolved and local government?
Jack Dromey
To develop our post office network, it is necessary to be imaginative and creative. Sadly, we are moving in the opposite direction.
The Government’s stance could not be clearer. They have rejected a number of opportunities to make the commitment firm in this important legislation. They have declined to accept a statutory commitment, as exists in countries such as Germany and the Netherlands, to a figure of 11,500. They have rejected the embedding in the Bill of the access criteria on how near people’s local post office will be. Post offices locally cannot live on warm words alone; good intentions and high hopes mean naught if we cannot have guarantees for the future.