Postal Services Bill

My Lords, this amendment seeks to embed employee involvement in the operation of a mutualised Post Office by including representatives from the workforce, particularly the sub-postmasters, on the board of the mutualised entity. We on these Benches are not opposed to the principle of the mutualisation of the Post Office, but for that mutualisation to work effectively for those running the business it is logical for them to have a direct say in the operational management of the business at board level. Mutualisation is not a new concept; its origins date back to the establishment of the Co-operative movement in the 19th century, which has many facets and is still going strong today. We on these Benches all support the Co-operative endeavour and can trace the roots of the Labour Party to it, but surprisingly, and somewhat disappointingly, mutuality is still not a particularly common concept today. The John Lewis Partnership is considered to be an outstanding example of how a mutualised business can operate. In that respect, the John Lewis Partnership is admirable, but there are very few other mutualised entities of a similar size to the one which the Government propose in this Bill. Indeed, in the financial services sector, where there is a history of mutualisation, the tide has rather been flowing the other way and only a few building societies have survived as mutuals. I understand that the Government’s mutuals task force is looking at how government can stimulate the transfer of assets of NHS bodies and local government to mutual status. Understandably, public sector workers have been hesitant to jump into new and untested structures. Recently, the Trades Union Congress claimed that a ballot at a south-east Sussex PCT showed that 90 per cent of staff were opposed to being ““spun out”” as a mutual—those are their words. The TUC stated with regard to that case: "““The moves towards mutuals are being driven by management rather than bottom-up. That makes a nonsense of the model because it relies on a buy-in from staff. You can't force mutuals””." Now there is potentially a new kid on the block—the Post Office. It is indeed an interesting idea and there is clearly an opportunity to establish that business as a thriving mutual. All of us want the Post Office network to prosper, and, we hope, one day be free of subsidy, but at a level that provides coverage for the whole of the UK. I understand that the Minister has said that the minimum number of Post Office branches required to sustain a universal obligation is 11,500; indeed, she said that only a few minutes ago. We welcome that and look forward to receiving more detail about how that number is to be sustained. That is an important point to make in respect of this amendment. While we welcome the mutualisation of the Post Office network, we want to understand in more detail how this might work in practice. In one respect mutualisation might be a straightforward share of any profits made among the members of the mutual, primarily its workforce. That is a common form of mutualisation, particularly in the Co-op, but given that the Post Office network relies on a significant subsidy that far exceeds its profits at present, such concepts as profit share might not appeal to the workforce if it means sacrificing their collective bargaining rights. Perhaps in this case a more attractive mutualisation model will be one that extends the participation of the workforce in the day-to-day running of the business beyond simply being the passive recipients of profit share schemes. That kind of model may also assist organisations such as the TUC to overcome their scepticism. The logic is equally strong for the participation of a sub-postmaster representative on the board. After all, sub-postmasters run their own businesses. They know what works and what does not. There is disquiet among members of the postmasters’ federation about this Bill—a disquiet reinforced by the decision by the DWP to announce the cancellation of the green giro contract during the passage of this Bill. As I have suggested, mutualisation can take a number of forms. My own party when in government looked at industrial democracy concepts for the Post Office way back in the 1970s and the party opposite did the same in the 1980s. Both those schemes ultimately came to nothing because quite simply employees in such businesses are always loath to give up their collective bargaining rights. Who can blame them? Therefore, in order to make the offer of mutualisation more attractive we would expect to see the Government bring through a package of measures that give the employees, managers and agents of the Post Office a real and genuine say in how the business is run. That should include direct participation on the board of Post Office Ltd. The amendment is not prescriptive; it would leave the decision on who is elected or appointed, and how they are elected or appointed, to the employees and sub-postmasters to decide. The employees, for example, might decide to nominate an outside expert or elect one of their own trade union officials. That is a matter for them to decide. The board would benefit significantly from the input of two people directly representing the interests of the core of the workforce, and that would make the prospect of mutualisation more attractive to those who may be hesitant to embrace the concept of democratic ownership. I beg to move.