Postal Services Bill

Jesse Norman Excerpts

Wednesday 27th October 2010 Commons Chamber

[Mr Bailey]

I do not recall anybody saying that post offices had gone through a halcyon period, but under the last post office reorganisation many sub-postmasters applied for the compensation package that was agreed for them. I very much doubt that that would still be available under a revised and privatised process.

[Jesse Norman (Hereford and South Herefordshire) (Con)]

The hon. Gentleman says that it is impossible to create mutuals from a transfer, but did not John Spedan Lewis create the John Lewis Partnership by transferring a business into an employee-owned trust? Is not that a great example of an existing business being transformed into a highly successful mutual, if not a co-operative?

[Mr Bailey]

Certainly John Lewis did that, but he did not just hand it over—there was a process by which he ascertained the willingness of others within the business to accept it. That situation has to be created. I could equally point to the situation in the ’70s when co-operatives failed because they did not have that in place.

I oppose the Bill because it is fundamentally flawed. At the Lib Dem conference, the Secretary of State said, “Capitalism takes no prisoners,” but since then he seems to have been on a private journey. That is demonstrated by this Bill, in which he puts forward a solution based on a brand of capitalism that I would describe as cuddly capitalism, whereby shareholders will forgo their private profit in order to embrace a co-operative and mutual solution that mitigates the social impact of their drive for profits.

--- Later in debate ---

[Glenda Jackson (Hampstead and Kilburn) (Lab)]

Earlier today I passed a lobby outside the House, whose protagonists were carrying placards that bore two messages. The first was “Bash the bankers, not the pensioners”, and the other was “Save our services”. Indeed, there is a lobby of pensioners in the House even as we speak. The Secretary of State highlighted the fact that post offices are of particular importance to pensioners. However, I thought he rather narrowed the importance of post offices, certainly for my constituents, because post offices are vital not only to pensioners but to people with disabilities, the unemployed and young parents. One must give credit to the new coalition Government, because their record is 100% consistent: despite their pronouncements to the contrary, all their policies attack the most vulnerable and the poorest in our society.

There are no guarantees whatever in the Bill that post offices and sub-post offices will be maintained. It is easy to say that there will be no more post office closures—I am somewhat confused on whether that covers sub-post offices—but without cast-iron guarantees, my constituents will suffer inordinately. All of us who were here in the last Parliament and who are most grateful and humble for being returned remember our struggles to save our sub-post offices. That is certainly true of my constituency and throughout London. I lost four in the last round, and six in the two previous rounds. Such closures impact on more than the individual users of the sub-post office. London is essentially a sequence of small villages, and sub-post offices tend to be a major part of the smaller, local economies. People go to the post office and do a little bit of shopping in their local shops. Once the post office goes, those other shops lose out.

The Government are telling us that the retail sector will be the essential driving force of our growing economy, but if there are no guarantees that essential counter services will be maintained, the economic fallout could be greater.

[Jesse Norman]

As it is true that no Parliament can bind its successors, and as we have in legislation a clear statement that there will no further closures, could the hon. Lady specify what guarantees she is looking for that cannot be found in the Bill?

[Glenda Jackson]

With all due respect to the hon. Gentleman, his Secretary of State stood at the Dispatch Box and gave categorical assurances that his proposals will revitalise and re-energise our postal services. He assured us not only that our postal services will not be diminished, but that they will expand and grow, and become more inventive and entrepreneurial. There is an apparent guarantee that national delivery will be set in stone. I asked him how the Government could guarantee for perpetuity a privatisation of postal services without entrepreneurs, who apparently will come rushing in, but the hon. Member for Northampton South (Mr Binley) said that entrepreneurs would run a million miles away from putting money into the Post Office.

The Secretary of State made those guarantees and cast them in stone, so why can he not do that in respect of sub-post offices? I am perfectly prepared to accept changes to post offices up to a point, but all the sub-post offices I know are additions to retail outlets, not the primary source of business for the individuals running them.

The public still firmly believe, despite the vagaries—or worse than vagaries—of the changes to our postal service, that the Post Office is a public service. The people of this country take great pride in it and believe it to be central and essential to their way of life. It matters not how many times one points out to them the decline in the number of letters we write, as everybody would apparently sooner send an e-mail because that is easier. I can understand that, but I am certain that I am not the only Member of this House who despairs of the day when e-mails were invented, because of the time it takes to send and read them. And what do we get at the end of it? I shall not go down that road, but I can see by hon. Members’ smiles that my experience is shared universally.

None the less, the public value and treasure the public service provided by post offices, and not only because, as for many of my constituents, it frequently used to be the case—this has improved slightly lately—that the only other human face that some people saw was that of the postman. In many instances, the only people whom they had conversations with were those they met in our sub-post offices. I have come across more than one example of a sub-postmaster missing seeing a particular pensioner over a comparatively short time span and alerting social services and the police because he was concerned that she might have had an accident or that something else might be wrong, and being proven right. Post offices do not simply offer a commercial service, whereby we can communicate with each other via the post; they offer a public service through which the public value each other and, in essence, take care of each other.

This Bill is yet another brick in the wall of what the Government are attempting to convince us will be their big society, if all these policies go through. However, it seems to me that what these policies will produce is the big broken society. If we lose the capacity to care for each other, what will be the point if we do manage to close the national deficit? It is the human beings of this country who are of primary importance. They are the ones who are going to get us out of this mess. Their feelings about public services are not limited to what the Government tell us are their priorities—the NHS and education. Rather, it is the public service in our postal services that they value. As others have said, there are aspects of the Bill to which one can give comparative support, but the Bill as a whole is an unmitigated mess.

--- Later in debate ---

[Richard Graham (Gloucester) (Con)]

I am conscious that we all come to this debate with our own scars of individual experience. Mine came in the ward of Kingsholm, a few hundred yards from where the Domesday Book was written, in my constituency of Gloucester. There, only two years ago, I watched my predecessor pose beside photographers while standing under a banner that proclaimed, “Save our post office”, but then vote in this Chamber against a motion to halt post office closures. The hon. Member for Hampstead and Kilburn (Glenda Jackson) said that she was concerned about the prospect of a big broken society. What I saw that day in Kingsholm was the very model of a big broken Government.

I did not take up the position of secretary of the all-party group on post offices to sit in the Chamber and watch another programme of 5,000 post office closures be passed. I have always believed that the best way forward is through a combination of much greater investment in Royal Mail, which handles the sorting, delivery and collection, and greater commercial freedom for post offices, which are independent small businesses; they are franchises and they need to be able to channel more services to our communities over their counters.

[Jesse Norman]

Is it not fair to say that the Government are making an attempt in very good faith to reshape the commercial conditions of the Post Office, which includes the removal of the pension obligation, the creation of greater employee ownership and a liberalisation in the market? Is it not that combination that will give the Post Office potential to grow and thrive?

[Richard Graham]

My hon. Friend is absolutely right, and what he describes is precisely why he and I welcome what the Secretary of State said. I also pay tribute to the detailed work done by the Post Office Minister before this debate.

Interestingly, the right hon. Member for Southampton, Itchen (Mr Denham) called for a Postal Services Bill lite. It would be lite in every way when it comes to investment because by trying to insist on Government retention of a majority stake—precisely what the previous Labour Government proposed in their Bill, which they unfortunately failed to take forward—he is condemning Royal Mail to not being able to get that investment. No private investor would be able to match the sort of investment in Deutsche Post, to which I alluded, of £15 billion unless they had a controlling stake in the company.

As we have heard, the Bill makes it clear that the Hooper report’s essential demand for greater investment and modernisation, despite the progress made in the modernisation agreement between Royal Mail and the Communication Workers Union, is vital to the future of this great British asset. The Labour party has not left this Government the luxury of providing that investment themselves. We can provide it only by attracting it from the business sector.

--- Later in debate ---

[Jesse Norman (Hereford and South Herefordshire) (Con)]

I have two great interests in the Bill. I speak as chair of the all-party group on employee ownership, which plans to examine the Bill in more detail, and also as head of the Herefordshire save our post offices campaign, which fought hard for several years to prevent local post office closures.

I was surprised by the partisan nature of some Opposition speeches, because there are many aspects of the Bill that Opposition Members should embrace and support. The Government deserve enormous credit for the speed and energy with which they have addressed a thorny and difficult issue. There is a marked contrast between that and the record of delay and compromise under the last Administration, during a period when the financial position of Royal Mail only became worse.

I welcome many aspects of the Bill, including the granting of access to new capital for efficiency and modernisation, the excellent arrangements for employee ownership, and the Government’s tough and difficult decision to take on the pension deficit—a nettle that the last Government signally failed to grasp. They preferred to keep it off the balance sheet, like the £230 billion of private finance initiative debt with which we have had to deal. There is a real possibility that, once those changes have been implemented, Royal Mail and the Post Office will be able to turn the corner. The idea of a new mutual structure for the Post Office is particularly innovative and important. This is a human capital business, which requires the human touch and the service that a mutual can bring to it.

However, serious concerns remain. The universal service obligation, which many Members have mentioned, must be preserved. I remind the House of what happened in the telecoms industry, whose privatisation was in many ways highly effective. The universal service obligation in telecoms does not cover either broadband or mobile telephony, but those are exactly the areas in which rural places such as Herefordshire have had a poor deal over the past decade.

I want to draw particular attention to the issue of back-door closures of post offices. We have a vivid case study of that in my constituency. The village of Pontrilas has an excellent post office and shop, with a sorting office, plenty of parking and disabled access. It is a vital community resource in a very rural area. Recently, the sub-postmaster was sacked by the Post Office for a very small mistake in procedure, from which he derived no personal benefit at all. In any other organisation, that would mean a slapped wrist. His case has gone to appeal but it appears that appeal in the Post Office means one person sitting in judgment on hundreds of cases across the UK. If he loses his job, the effects will be disastrous not merely on him—a man who has had no income for the past six weeks, nor is any to come from the Post Office—but on the shop, which would close. The sorting office would go, too, as most probably would the Longtown post office and its sorting centre up the road in one of the most rural areas of this country.

Therefore, I ask the Minister to take an interest in the situation and to look at the position at the Pontrilas post office. I ask whether he agrees with my view that such back-door closures should be prevented and should be included within the remit of preserving the post office network. I also ask whether he shares my view that we need to grow our post offices, push more business through them and use them to support our towns and villages.

[Mr Deputy Speaker (Mr Nigel Evans)]

To resume his seat at 6.30, Mr Chris Evans.