Postal Services Bill

I rather regret that my noble friend used the word Luddite in relation to the employees of the Royal Mail. I did not use that term, and I very much regret that it should be so misapplied, as he has misapplied it, to the overwhelming mass of employees of the Royal Mail who know that they need to embrace change but, I fear, did not and do not have the leadership of the union to enable them to do so in the way that they need and wish to. The task now is to make sure that the new Bill secures the Royal Mail's future and the viability of its business model, underpins the universal letter delivery service that the public requires and relies on and sustains the relationship between the Royal Mail and the nationwide post office network. This needs to be got right in this Bill. These goals are chiefly dependent not on the Royal Mail's ownership but on the new legislative framework of regulation which the company will operate within. I have no doubt this needs extensive rethinking. I say this frankly: Labour did not get the Royal Mail's regulatory regime right early on when we introduced legislation, and that is why we proposed extensive reform in our Bill. In my view, the priority for debate and amendment in this House should concern chiefly the clauses of the new Bill concerning future regulation. This is the nub of the issue and where the greatest and most detailed examination needs to take place because we need regulation that enables Royal Mail to compete without both hands tied behind its back. This means regulation which recognises the unique role of the Royal Mail as the universal service provider and its need to be profitable in delivering the service. It must also provide the basis for attracting much-needed new capital to the company and experienced management who can provide skill and expertise. I accept that it is at least arguable that under Labour's original legislative proposal for a strategic partner in a minority position in the company, it might have been hard to attract the required capital and management strength, and that, from this minority position, it might have been too difficult to bring about the necessary change to turn round the company. In any case, this is history. What I cannot accept, though, is that a so-called foreign presence in the ownership of the Royal Mail is somehow treacherous or bound to lead to disaster, as we have heard expressed again and again in the other House. Deutsche Post and TNT in the Netherlands have shareholders from across the world, including Britain, and international alliances between Europe's postal operators will be widespread in the future. We do not have a nationality test for investment in Britain. The previous Labour Government were implacably opposed to such a thing, notwithstanding the wider review of take-over rules that I initiated. We are successful in Britain at attracting inward investment. In former utilities, we now have EDF, RWE and E.On, for example, and many people's jobs in Britain depend on that investment and that ownership. So let us not have false, little-Englander sentiments injected into the debate. Our examination of the Bill should focus instead on the detail of the new system of regulation, on which I hope the Government will be open to argument and persuasion. However, we cannot let this moment, an opportunity for reform, end in failure again. Royal Mail, once reformed, will then need stability and to be allowed to get on with its job, and in that context I welcome the fact that from Labour's Front Bench we have not heard a commitment to renationalise the Royal Mail should it pass out of state ownership. This is sensible. As with gas, water and electricity in the 1980s and 1990s, Labour moved from a position of flat-out opposition to change, to a decision not to renationalise, to an embrace of these utilities performing well in the commercial sector. I suspect that history will repeat itself should privatisation be achieved. My last observation is only that there is probably a wider moral to the Royal Mail saga: that when difficult issues come along, we cannot just run away from them. There is a Labour way to change things, and for us that meant bringing in a new partner but in minority ownership. When that Labour way does not happen or is stopped, the issue does not go away. It comes back, sometimes with a solution in a less palatable form than we originally wanted. That is exactly what has happened here, just as the then Prime Minister and I warned would happen if our reform and our Bill did not go ahead. I am only sorry that our warnings fell on deaf ears at the time.