Postal Services Bill

Debate between Nia Griffith and Andrew Griffiths

Wednesday 27th October 2010 Commons Chamber

[Nia Griffith]

Thank you.

Today we have been debating a Bill that will lead to the sale of Royal Mail. Many Members have mentioned the fact that the Royal Mail letter service has faced increasing competition from e-mail and text in recent years, and the decline in letter volumes has continued even between the publication of Lord Hooper’s original report in 2008 and the update published last month. Many Members have spoken today, and I hope I will be forgiven if I do not mention every one of them by name, but I do want to pick up a few of the points that have been made.

The hon. Member for Northampton South (Mr Binley) serves on the Business, Innovation and Skills Committee and he obviously recognises the need for change. He also made the point that good management is vital, and asked the Minister to make clear how he proposes to secure the quality management that is needed. We all want to hear the answer to that question.

My right hon. Friend the Member for Newcastle upon Tyne East (Mr Brown) wanted to find ways of taking modernisation forward. He pinpointed what we all need to know: how to provide more business for the post office network. The Bill does not provide an answer to that.

The hon. Member for Solihull (Lorely Burt) wanted more information about mutualisation, and I recognise that she and her party have long supported mutualisation. Like many of us, she cannot see exactly how these proposals will work for the post office network.

My hon. Friend the Member for Vauxhall (Kate Hoey) highlighted a problem to do with sorting offices, as did other Members with sorting offices in their constituencies. They are concerned about the consequences of the Bill for sorting offices. We also had a brief interlude from the hon. Member for Woking (Jonathan Lord), who made an enlightening and enjoyable maiden speech. [Hon. Members: “Hear, hear.”]

The hon. Member for Angus (Mr Weir), speaking for the Scottish nationalists, stressed concerns about the pressures on a privatised service to reduce the extent of the universal service, and highlighted the particular needs of rural areas, as did many of my hon. Friends. The hon. Member for Southport (Dr Pugh) raised concerns about the future viability of the post office network and stressed the idea that local government and communities need to decide exactly what they want a post office network to do.

My hon. Friend the Member for West Bromwich West (Mr Bailey) has a long tradition of work with the co-operative movement, and he expressed a fundamental philosophical objection to privatisation: the problem of how to square the inevitable drive to make profits and satisfy shareholders with the provision of a service for the public.

The hon. Member for Pendle (Andrew Stephenson) emphasised the problems of the current regulatory regime, and my hon. Friend the Member for Hampstead and Kilburn (Glenda Jackson) emphasised the importance of the post office network for pensioners and the local economy.

The hon. Member for Warwick and Leamington (Chris White) spoke in support of the proposed employee share scheme, although he was disappointed that only 10% of the stake will be going to such a scheme. My right hon. Friend the Member for Wolverhampton South East (Mr McFadden) explained that if the taxpayer has taken on the burden of the pension deficit, the taxpayer should share in the upside of the transformation of the Royal Mail. He made a compelling case for keeping the majority stake in Royal Mail in public ownership.

My hon. Friend the Member for Washington and Sunderland West (Mrs Hodgson) wondered what would happen if a privatised Royal Mail got into financial difficulty, and my hon. Friends the Members for Blaydon (Mr Anderson) and for Middlesbrough South and East Cleveland (Tom Blenkinsop) expressed concerns about job losses, and workers’ pay and conditions in the private sector.

We heard speeches in favour of the Bill from the hon. Member for Gloucester (Richard Graham)—who did, however, request a specific list of several actions to be taken—and the hon. Members for Castle Point (Rebecca Harris), for Folkestone and Hythe (Damian Collins) and for Rossendale and Darwen (Jake Berry).

My hon. Friend the Member for Walthamstow (Stella Creasy) was very concerned about how post offices can be made viable with the loss of Royal Mail business, and I now wish to discuss that particular problem. The Bill, as it stands, provides no guarantee of a continuation of a daily delivery of letters six days a week to every home in the United Kingdom. The Bill, which puts Royal Mail entirely into private hands, provides no guarantee that a wholly privatised Royal Mail would continue to use the post office network to provide its counter services. The Bill breaks the historic link between Royal Mail and the post office. In fact, Royal Mail could use a high street chain whose branches are largely confined to town centres. The Bill even proposes the surreal spectre of a post office network without any Post Office services. With the loss of the one third of its income that comes from Royal Mail business, the post office network could see a closure programme on an unprecedented scale.

Perhaps we were supposed to be taken in by this and lured into some false sense of security, but today the Secretary of State announced new investment.

[Andrew Griffiths (Burton) (Con)]

The hon. Lady talks about closures in the post office network on an “unprecedented scale”, but could she remind us just how many post offices closed under her Government?

[Nia Griffith]

I can certainly remind the hon. Gentleman that a viable post office network consists of some 4,000 post offices, and that our Government put in the funding to keep 11,500 post offices open. Not only that, but we guaranteed a £150 million subsidy per year up to 2011, increasing it to £180 million for 2011-12, and designated access criteria to ensure that people would be within a short distance of their local post office, which provided that some 90% of the population would be within a mile of a post office. Without those criteria there would have been wholesale closures before now.