Postal Services Bill

In supporting the amendment tabled by the noble Lord, Lord Low, I shall speak to my Amendment 16A. The Bill does little to ensure accountability to the devolved Administrations in the United Kingdom. Yet we must recognise the vital services provided by the Royal Mail to the whole of Great Britain and Northern Ireland. It is part of our country’s infrastructure, supporting economic and social interaction across all the nations and regions, and we should retain universality of service across the whole country. The needs of service users varies depending on where they live, with those in rural and hard-to-reach areas particularly dependent on postal services and vulnerable to changes that may follow from the introduction of the Postal Services Bill. For that reason, I believe that the devolved Administrations must be kept informed about the developments in postal services. Specific analysis should be undertaken and the likely impact of changes to postal services in Scotland, Wales and Northern Ireland should be properly considered. Moreover, specific consideration should be given to those with particular needs, such as pensioners and people with disabilities, a point eloquently argued by the noble Lord, Lord Low of Dalston, a few minutes ago. The devolved Administrations already take a keen interest in postal affairs and recognise their importance. Economic development has been important to the Welsh Assembly and the Scottish Executive. They support the needs of small business in rural areas and both Administrations have made significant investments in their post office networks over these past years. In my view, it is unlikely that any of the devolved Administrations would want to see the break-up of the universal service. Providing detailed reports to the devolved Administrations would give them the opportunity to comment on particular implications of changes and will be important to improving oversight and accountability. The future of Post Office Ltd and the continued provision of the universal service are a particular concern. Scotland, Wales and Northern Ireland contain large rural communities that would be disproportionately affected by any further decline in the post office network. The post office network is struggling. More than 150 post offices were closed as long-term temporary closures in 2010 alone and more than 900 post offices are up for sale. Sub-postmasters are struggling to make a living from their post offices. I fear that this Bill will potentially make things more difficult for them if we do not seek to improve it. Breaking the link between Post Office Ltd and Royal Mail puts one-third of the Post Office’s revenue at risk. If the two cease to be part of the same company, there will be no guarantee that Royal Mail continues to sell its products through the Post Office. The Government’s proposals for the redesign of the post office network will see 4,000 ““main”” post offices created and the remaining post offices becoming ““essentials”” and ““locals””. Essentials and locals will not provide the full range of post office services and some 2,000 sub-post offices would be transferred into essential or local category by 2014. They will offer only a proportion of the widespread post office services now available. I think that all remaining non-main post offices are likely to follow soon after. In order to ensure that all areas have access to the full range of postal services, the post office access criteria should be extended to ensure that the spread of main post offices across the United Kingdom is equal. Without such criteria, it would be possible for there to be no main post offices located in Scotland, Wales and Northern Ireland, and no access to the full range of government and post office services as a result. Post Office Ltd’s financial position is a particular issue for Scotland, given that 70 per cent of the branches there are in rural areas where revenues are significantly lower than average. In 2009-10, there were 1,446 branches in Scotland, including 90 outreach services. Of those post office branches, 68 per cent are in rural areas and the proportion of rural branches is significantly higher than UK average of 55 per cent. The network in Scotland is in a precarious position financially, with rural post office branches typically being less well remunerated and less economically viable. It is clear, however, that the post office is a vital public institution in Scotland, a matter of great concern to the Scottish Parliament and the Scottish Executive. Wales also has a higher than average number of rural post offices, at 71 per cent compared with the UK average of 55 per cent. There were 963 post offices in Wales in March 2010, eight fewer than the previous year. Only 17 per cent of Welsh post offices are in urban areas, compared with an average of nearly 34 per cent for the rest of the United Kingdom. Some 16 long-term temporary post office closures were made in Wales in 2010, all in rural areas, and the Post Office is currently advertising 56 post offices for sale across Wales. But the post office remains a lifeline for communities in Wales. Research for Consumer Focus Wales has found that 96 per cent of people in Wales use the post office, 53 per cent at least once a week and, of those interviewed, 10 per cent said that they visited three times a week or more. Some 47 per cent—almost half—of all those who use the post office in Wales use it as a bank, to collect benefits, pay money in, take money out and pay bills. This is particularly the case for people over the age of 65, where 58 per cent of that age group use the post office. Some 66 per cent of people who do not have a car in Wales use the post office, while 61 per cent of the long-term ill and disabled use it; 65 per cent of post office users in Wales do not have access to the internet, and 58 per cent are on low incomes. This shows the importance of the post office network and why the Welsh Assembly should be consulted about any changes, along with the Scottish Parliament and the Northern Ireland Assembly. There are 480 post offices in Northern Ireland, 68 per cent of which are in rural areas, and in 2010 there were at least eight long-term temporary post office closures. The Post Office is currently advertising 19 post offices for sale in the province. The Postal Services Bill sets out a minimum standard for the universal postal service. However, it is just a minimum. The Bill also contains numerous routes by which those minimum standards can be reviewed and reduced. This is of especial concern to those in rural, hard-to-reach areas where the universal service is particularly expensive to provide and where Royal Mail will come under pressure to reduce such services. People living in rural areas are particularly at risk from the erosion of the universal service. An affordable, universal service is essential for small businesses and domestic customers if they are to engage in the economy and enjoy the benefits of the internet. Much has been made of the revolution of the digital age and its impact on Royal Mail, but we must not forget that without Royal Mail’s universal service, people in rural communities will not be able to buy online, to sell online, or enjoy the benefits of running a small business from home. With each possible reduction in the universal service obligation, mail services in Scotland, Wales and Northern Ireland are at particular risk. Parcelforce and other parcel providers feed parcels into the Royal Mail’s networks for delivering to the Highlands and Islands. Given the additional financial burden that accessing these areas presents, any reductions in the service based on cost are likely to hit these regions first and hit them hardest. There must be proper analysis of the impact of the changes in Scotland, Wales and Northern Ireland. It is important, therefore, that the report should be made by the Secretary of State to the devolved Administrations. The noble Lord, Lord Low of Dalston, spoke eloquently about the impact that the changes could have on pensioners and disabled people and, in view of the time, I will not rehearse those arguments now, but I entirely support the points that he made. I hope that the Government will consider the amendments before them. The Minister and I met by chance earlier this evening. I was waiting to go into the Interview Room and she was just coming out having had a meeting with her officials. We politely exchanged conversation and I was presumptuous enough to say that as a former Minister my advice to a current Minister is not always to take the advice of her civil servants. If they have advised her to resist these amendments, I suggest that she listens to my advice and not to that of her officials.