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Mrs. Gilroy: Will my hon. Friend also draw to the Opposition's attention the report on access to financial services by the Treasury's policy action team? It goes into considerable detail about the role of post offices and sub-post offices in addressing social exclusion. As that is a criticism in the Liberal Democrat motion, I think that it is high time they read the report.
Mr. Johnson: I thank my hon. Friend for that helpful intervention.
Last Monday was the 160th anniversary of the introduction of the penny post and Rowland Hill's other great reforms. Those radical changes created the modern Post Office by transforming an organisation that had, even in 1840, been a central feature of British life for 300 years. In Victorian Britain, the Post Office dealt with 75 million items every year. It now handles that volume every working day.
Mrs. Angela Browning (Tiverton and Honiton):
When the Secretary of State for Trade and Industry sent hon. Members his "Dear colleague" letter last May, announcing out of the blue that the Government had decided to change their action on benefit payments through the post office network, we waited for a month for the imminent White Paper. In July 1999, when the Secretary of State introduced the White Paper, we discovered that no viable option was on offer that would give hope for the future to many of our smaller, more sparsely spread post offices. Within a week, the Conservative party used a half-day Opposition debate to bring the matter to the Floor of the House. We thought the matter so important that that was our immediate reaction.
Since then, there have been many debates on the Post Office, including the one that I attended last week in Westminster Hall. The issue keeps coming before us, and Ministers keep having to come to the Dispatch Box, because there is great uncertainty. So much time has elapsed since the statement last July that post offices are already feeling the pinch. People trying to dispose of their businesses, and others considering buying a post office, are taking into account the prospect of a 30 per cent. drop in revenue by 2003.
Those of us who represent large rural constituencies know--although this is not an exclusively rural matter; I am equally concerned about post offices on the suburban fringe--that unless we receive answers to the many questions raised about the Government's change in policy, the situation will become worse long before the change to automated credit transfer, which the Government are determined to push through in 2003.
Mr. Livsey:
The hon. Lady makes some cogent points about rural areas and their post offices. Does she agree,
Mrs. Browning:
The hon. Gentleman draws attention to the fact that the sub-post office network has been under pressure for some time. No one who has day-to-day dealings with constituency cases would deny that. However, I can think of cases in which hours went up as well as down. The hon. Gentleman's point is important because of changes in the structure of services provided by post offices, and, particularly, because of changes in the businesses in which they are located, which are as key to their viability as the Post Office itself. The post office has sometimes become the village shop, which has diminished the service. We all know that people often shop once a week outside their villages, and for that and many other reasons the position of the village post office has worsened.
We face a change in the policy that the Government inherited. Their proposals leave many questions unanswered. We do not know what sort of post office network we shall have in 2003, if the Government have their way. People will be obliged to have benefits paid into a bank account, although the Minister has told us tonight that they may be able to receive their benefits in cash through electronic transfer. He told us that there will be no cost to the people concerned, but we should like to know his estimate of the costs of the new system by comparison with the costs of the one he inherited. Who will pick up the transaction cost?
The Minister was asked those questions by the hon. Member for Twickenham (Dr. Cable), and I asked them last week and last July. Seven months after the July statement, the Minister remains unable to answer specific questions. The Secretary of State changed the policy last May. He did so without any idea of what system would replace the existing one. Since then, there have been all sorts of suggestions about how the Government would shore up what will clearly be a significant drop in revenue. We believe that there is a question mark over the viability of 50 per cent. of the country's 18,000 sub-post offices.
The Secretary of State leapt into the press the moment he heard that Camelot and the Post Office would put together a joint venture for a renewal of Camelot's lottery licence. There was nothing wrong with that bid; let us hope it is successful. However, the Secretary of State's argument that that would help rural post offices merely flagged up his lack of knowledge both of the lottery system and of what happens when there are terminals in small outlets in rural areas.
I have had to write to Camelot repeatedly about small post offices or shops that had terminals but were unable to maintain 3,000 transactions a week. Terminals have been withdrawn from many of them, and many hon. Members will have had the experience of fighting to have terminals restored. One advantage of having a lottery terminal in a post office is that the terminals increase the
footfall of people passing through the premises. Those people buy other things and carry out other transactions, which helps the viability of the unit.
Mr. Alan Johnson:
I am extremely interested in the hon. Lady's views on the Post Office. Between now and 2003, when migration starts, there will be a general election. Will the Conservatives fight that election on the platform of privatising the whole of the Post Office, or do they intend to break it up and privatise only half of it?
Mrs. Browning:
What an extraordinary question. The Labour Government are going to privatise the Post Office, and they plan to introduce a Bill any day now. We look forward to reading it, and the Conservative manifesto will reflect the changes that the Government make to the Post Office before the general election. The Secretary of State promised that the Bill would turn Royal Mail into a public limited company and that the Government would own 100 per cent. of the shares. During the recess, however, the Secretary of State said that the Government might not own quite 100 per cent. We want to know what privatisation package the Government intend. Once we have seen what we will inherit, we will produce a manifesto telling the British people what we will do.
I am flattered that the Minister wants to know what our manifesto will say, but tonight's debate is not about our manifesto but about the policy that the Government inherited from the Conservative party, which would have secured the payment of benefit. The Minister rightly said that they would have to move away from the old-fashioned system of paper transactions towards the use of a swipe card and, ultimately, a smart card. Answers to oral and written questions gave us every reason to believe, until 29 May last year, that the Government intended to do that.
Some Members in the Chamber this evening were not in Westminster Hall last week when my right hon. Friend the Member for Hitchin and Harpenden (Mr. Lilley), who served both as Secretary of State for Trade and Industry and for Social Security, pointed out that if the post office network was going to survive, there would have to be a change in systems and technology, and the network would have to be underpinned by the presence of a customer that pays out benefits--the Government. We fought the last election on that principle, but the Government have changed that policy.
Mrs. Gilroy:
The hon. Lady was trying to make a point about the decision taken by the Government in May 1999. I am sure that she has studied in great detail the report of the Select Committee on Trade and Industry, which notes:
Mrs. Browning:
Of course I am. If there are criticisms about the system and the contracts that were drawn up, that is a legitimate matter for inquiry. However, it in no way detracts from the fact that the Conservative party went into the previous election with a policy that would have ensured that the payment of benefits through post
As the hon. Lady is interested in Select Committee reports, I advise her to note the statement that
"We do not fault Ministers for taking the decision they did in May 1999 in these circumstances. We have not regarded it as part of our task to come to a judgement on decisions taken prior to May 1997; it may be that the inquiry by the Comptroller and Auditor General will cast light on such decisions."
Is the hon. Lady looking forward to dealing with that report?
"Ministers have been less than candid in their responses to the House and to this Committee".
Will she ask Ministers what the Select Committee meant by that?
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