Postal Services (Rural Areas)
Debate between Jo Swinson and Michael McCann(10 years, 8 months ago)
Commons ChamberRead Full debate Read Hansard Text
Jo Swinson
The hon. Gentleman is obviously an avid reader of the Liberal Democrat manifesto, perhaps unlike his hon. Friend the Member for East Kilbride, Strathaven and Lesmahagow (Mr McCann)—
Jo Swinson
If the hon. Member for East Kilbride, Strathaven and Lesmahagow will let me finish the sentence first, he may be fortunate and I may be able to give way to him.
Indeed, we recognised in the Liberal Democrat manifesto that Royal Mail would need an injection of private capital. Clearly, in the current plans at least 10% is guaranteed as worker shares. That is right and, importantly, it is set down in the Postal Services Act 2011. Obviously, the shape and format of the present proposals is not a carbon copy of what was in the manifesto. We are three years on from then and we are working within a coalition Government.
Mr McCann
May I remind the Minister that the Liberal Democrat manifesto committed also to full public ownership of the post office network? Can she explain how that sits with selling off the Crown post office network through franchising and with the Government’s plans to sell off most of Royal Mail, whereas the manifesto specified only 49%?
Jo Swinson
It is very important to make the point that the post office network remains in public hands. We need to get it on to a sustainable footing. I should have thought the hon. Gentleman welcomed that. The opportunity to mutualise the post office network ought to be welcomed not just on the Liberal Democrat and Conservative Benches, but on the Labour Benches, as it will ensure that ownership of such an organisation is more widely available to stakeholders within it, including not just sub-postmasters, but customers and others. That mutualisation process is an important part of the future of the Post Office.
The hon. Gentleman mentions the Crown network. In our post office network of almost 12,000 branches, the vast majority of which, as has been outlined eloquently by many speakers in the debate today, are small sub-post offices. About 370 are Crown post offices in the busiest high streets and town centres. For those 373 offices to be losing more than £40 million a year, as they were when this Government came into office, is unsustainable. I hope the hon. Gentleman will recognise, therefore, that getting the Crown network as well as the rest of the post office network on to a sustainable footing is essential to the future success of the Post Office.
Jo Swinson
I am making the point clearly that the Government remain the key shareholder in Post Office Ltd and therefore accept that the Post Office is in public hands. I concede that we are suggesting that when it becomes financially sustainable it would be a positive future if the post office network could be mutualised, which would mean it would not remain in Government hands, but I would have thought that that was something the hon. Gentleman welcomed.
With regard to the motion, I understand that with Back-Bench business we often have good debates on various issues and that votes are not common. I agree with much of the motion, but hope to be able to reassure the House on a couple of points. In relation to the claim that
“the impending privatisation of Royal Mail will place a question mark over its willingness to maintain what may be loss-making services”
and the reference to providing
“more concrete, long-term protections for postal services in rural areas”,
I hope to reassure the House that the Government have long-term, concrete protections in place for postal services, and indeed that the Royal Mail will have to continue to provide the universal service. Many Members have raised that as a concern.
In setting out the background to how we got where we are today, it is important to remember that the Government are implementing a package of key reforms recommended in Richard Hooper’s independent review, which was first commissioned in 2008 by the previous Government. He set out three clear recommendations that needed to be implemented as a package if the Government wanted to secure the future of the universal postal service: that they should tackle Royal Mail’s historic pension deficit; that responsibility for postal regulation should transfer from Postcomm to Ofcom; and that Royal Mail should have access to private capital to support its ongoing modernisation. The previous Government accepted those recommendations in full, but their Bill was subsequently dropped owing to market conditions.
The Postal Services Act 2011, which was passed a little over two years ago, enables the Government to implement the full package of recommendations. As the House will be aware, we have now relieved Royal Mail of its historic pension deficit—I am glad that the hon. Member for North Ayrshire and Arran was able to welcome that move—and established a new regulatory regime under Ofcom, with stronger powers to protect the universal service. The third and final recommendation, to give Royal Mail future access to private capital, is now being progressed through the planned sale of shares in the company. That is a crucial element of the Hooper package. It will be positive for Royal Mail as a business, enabling it to respond to the changing needs and demands of postal users now and in the future. Most important, it will help secure a sustainable universal postal service in the UK.
Many Members have rightly mentioned that the universal postal service is crucial to the UK’s economy and social fabric, particularly in rural communities, and the coalition Government recognise that. That is why the overarching objective of our postal market reforms is to secure the future provision of the universal postal service, the six-days-a-week service at uniform, affordable prices for everyone in the United Kingdom, regardless of whether they live in urban, suburban or rural communities.
Various references have been made to whether that is a sufficient service or a minimum one, so I thought that it would be helpful to state what it actually means and what is set down in the legislation, which will continue to apply in the event of Royal Mail being sold: six-days-a-week delivery to the home or premises of every individual in the UK; six-days-a-week collection from every access point—post boxes and post offices—in the UK; a uniform, affordable tariff across the UK; the provision of a registered items service at uniform tariff; the provision of an insured items service at uniform tariff; free postage for the blind and partially sighted; and a free service of conveying qualifying legislative petitions. That is all set out in legislation, so regardless of ownership Royal Mail will continue to provide that universal service. The ownership change does not change that; only Parliament can change those requirements.