Covid-19 Pandemic: Royal Mail Services

Seema Malhotra Excerpts

Tuesday 19th April 2022 Westminster Hall

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

It is a pleasure to service under your chairship today, Ms Ali. I congratulate my hon. Friend the Member for Dulwich and West Norwood (Helen Hayes) on securing this important debate and thank all hon. Members who have spoken. I will reflect almost all their comments in my remarks this afternoon.

The postal industry is hugely important to the well-being of our country. The covid-19 pandemic highlighted the importance of the service and of its workforce. For the past two years, Royal Mail workers have selflessly provided key services delivering vaccinations, shielding letters, covid-19 tests and PPE items, as well as enabling people to communicate with their loved ones when they were unable to visit them in person. It is right that today we have heard hon. Members across the House recognise them for their extraordinary efforts. It is also important that we review together how we can better hold Royal Mail management to account. I want to mention one of my constituents, Councillor Poonam Dhillon, who was a dedicated Royal Mail worker who sadly died of covid last year.

Royal Mail has a long and storied history dating back to 1516, roughly taking the shape that we know today in the 19th century with the introduction of the first stamp in 1840 and with the first pillar box erected in 1852. Those were important reforms, as was the setting of a duty on the postal service across our islands that Royal Mail must deliver to every address in the UK six days a week at a uniform price.

The Postal Services Act 2011 gave a statutory basis to the universal service order, which defines what should be considered part of the universal postal service. The Act sets out the minimal requirements that Royal Mail must deliver. The USO can be amended by Ofcom, which designates regulatory conditions, including pricing and performance targets.

The Royal Mail is the UK’s universal services provider, which is a sign of the respect and trust we have placed in the postal service in our country. A character in a book by Anthony Trollope, the Victorian novelist who also invented the pillar box, once exclaimed of the stamp: “Surely this little Queen’s head here can’t be untrue!”.

Trust matters, yet trust in this very significant public service has been significantly weakened since Royal Mail was privatised by the coalition Government in 2014. The Business, Innovation and Skills Committee at the time concluded that it had been undervalued in that sale by David Cameron’s Government—to the tune of £1 billion to the taxpayer.

What was the result? In 2020-21, Royal Mail significantly missed its targets that a minimum of 93% of first-class mail is delivered the next working day and a minimum of 98.5% of second-class mail is delivered within three working days. Just 74.7% of first-class mail and 93.7% of second-class mail met those service targets.

Although we all acknowledge the unique conditions of the pandemic, during which sickness eroded staffing levels and isolation increased the parcel load, data from Citizens Advice’s 2022 state of the sector report suggests that the service has not recovered. It found that at the beginning and end of 2021, letter delays were widespread across the country. During Christmas last year, almost 15 million people were left waiting for post. Over half of those reported going at least a week without letters, as we have heard today.

In previous debates, Members have complained about mail arriving late for their constituents and, worryingly, the Citizens Advice report also found that one in 14 UK adults had experienced serious negative consequences of struggling to receive their post, missing important documents such as insurance letters or fines. Last July, Royal Mail committed to returning to pre-pandemic quality by the end of August, but as the CA report makes clear, it did not. In response to this persistent failure to meet its targets, Ofcom has told Royal Mail that it must take steps to improve performance as the effects of the pandemic subside.

May I ask the Minister what expectations the Government have of Royal Mail for the timescale in which its performance will return to pre-pandemic levels? Will he tell the House what discussions he has had with Ofcom about the next steps for Royal Mail, and say what potential repercussions Royal Mail executives could face if they do not meet their targets?

Although Ofcom has the power to fine Royal Mail, as it did in response to missed delivery targets in 2018 and 2019, more stringent measures might need to be taken. A further significant issue has been the closure of Royal Mail delivery offices and the impact of such closures in some areas is still very much ongoing. My hon. Friend the Member for Dulwich and West Norwood has been a dedicated campaigner for her constituency ever since the SE22 delivery office was closed in 2018. She spoke very powerfully about that closure in her speech today. Despite being warned by my hon. Friend and community stakeholders that that closure would make delivery more difficult, Royal Mail pressed forward and closed the delivery office in East Dulwich anyway. That decision continues to impact the performance and services that local businesses and residents are receiving. My hon. Friend has also talked about there being no resilience in the SE15 service, and the poor and unreliable services for a range of her constituents. We need to look at the measures that have been raised today, including reporting at a more detailed postcode level, because transparency is not the enemy of democracy.

Royal Mail’s recent history has raised concern that it seems to be driven by a mission to increase dividends for shareholders ahead of genuinely fulfilling its responsibilities as the nation’s universal service provider. Following the cuts of 2,000 managerial roles in 2020-21, in January this year Royal Mail revealed plans to cut a further 1,000 management jobs. Although Royal Mail has said that cuts are intended to streamline operational management and to improve focus on performance at a local level, they come in a year of record-breaking profits for shareholders and an increase in the cost of first-class stamps of nearly 12%. At the same time, Royal Mail will bring in a lower-paid managerial role, in a move that Unite the union has compared to fire and rehire practices. That is absurd at a time when the service is already struggling to meet basic performance targets and when data suggests that Royal Mail has the capital needed to make investments without such a scale of job losses.

Will the Minister say what discussions he has had with Royal Mail and the relevant trade unions—Unite and the Communication Workers Union—about the scale of job losses? Has he discussed the service’s prospective plan to streamline operational management in terms of equipment, transformation for future business and staffing? Does he recognise the work of the unions, including the CWU’s acknowledgement of the need for modernisation? That need is understood: unions want to work with management to reform an organisation that their members work for with pride.

May I also ask the Minister whether he has considered the CWU’s proposal to integrate a high level of corporate social responsibility on environmental issues and employment standards into the postal regulatory framework? What discussions has he had about the affordability of postal products?

We need better communication with Parliament. As Royal Mail moves into a new regulatory framework for 2022 to 2028, I want it to be open to better communications with Parliament, stakeholders and communities. Although Royal Mail is technically independent of Government and overseen by Ofcom, it remains an essential public service. Yet it has been hit by a decade-high rate of more than 1 million complaints and high sickness absence rates. There were boosts otherwise for shareholders last year, as parcels helped Royal Mail to achieve a £311 million profit. For that reason, Labour will continue to call for Royal Mail to be held more strongly to account, for the Government to actively listen to the debate and for a better postal service in all parts of our nation, as the public expect and demand.