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Dr. Gavin Strang (Edinburgh, East and Musselburgh): I congratulate my right hon. Friend on rising to the challenge of creating a financial environment in which we can have a thriving and prosperous network of post offices. Is he aware that my constituents will particularly welcome the fact that he recognises that post offices in some of the less affluent urban areas are even more vulnerable than those in rural areas on the move to automated credit transfer? Those same constituents will attach huge importance to the potential of the universal bank which he has announced today. While recognising that the small print and the details of the agreement with the commercial banks will be produced later, is my right hon. Friend satisfied that he will reach an agreement with the private banks that will enable the universal bank to achieve its full potential to sustain the network? For example, will an individual who already has an account with a private bank be able to open an account with the universal bank?
Mr. Byers: My right hon. Friend is right to say that there are many aspects of today's announcement will be of real benefit to his constituents and to many other people living in inner-city areas. Much of the work conducted by the performance and innovation unit revealed that many of the 3.5 million people who do not have a bank account felt that a bank account was not appropriate for them for two main reasons: first, they felt that they were talked down to and they felt uncomfortable about going into a bank; and secondly, they did not want to get into debt as a result of having an overdraft facility. The reason why they liked the idea of a universal bank was that they trusted the Post Office and felt comfortable with it. They felt that they could trust the way in which the Post Office dealt with their affairs. People who already have bank accounts will be perfectly entitled to join the universal bank and they will be offered the whole range of financial services that the banking sector provides. Once again, that will be a matter of choice, but I am confident that the universal bank will open up a new direction in terms of offering financial services to many people who are presently excluded from many of the benefits that most of us take for granted.
Mr. Dafydd Wigley (Caernarfon): The Secretary of State said that there would be a new fund to help post offices in deprived urban areas. Will he confirm that there will be a mechanism to give the same help to post offices in deprived rural areas? Does the ring-fenced money to
which he referred apply equally to both urban and rural areas? Will he clarify conclusion 10 on page 89 of the report, which states that that ring-fenced fund will apply in England, but that similar arrangements in Scotland, Wales and Northern Ireland will be matters for the respective devolved Administrations? Will he confirm that any ring-fenced money will be additional for those areas, as it will be for England?
Mr. Byers: As to the position with regard to the devolved Administrations, I know that my right hon. Friend the Secretary of State for Wales is making an announcement this afternoon about how he intends to deal with these matters in Wales.
The ring-fenced funding has been negotiated in the context of the comprehensive spending review, and it will apply to Wales as well as England. The right hon. Member for Caernarfon (Mr. Wigley) is right to point out that targeted financial support must be supplied to deprived rural areas as well as to deprived urban areas, but that support will take different forms. The power to put subsidy into rural areas is contained in the new Postal Services Bill, but the fund for deprived urban areas is exclusively for those areas, and will be ring-fenced accordingly.
Dr. Lynne Jones (Birmingham, Selly Oak): Proprietors of sub-post offices in my constituency are very worried about the declining value of their businesses. They tell me that they want not subsidy but proper recognition for the valuable service that they provide, much of which is on behalf of the Government. The measures announced today will go some way towards alleviating their concerns, but there is likely to be some delay in their implementation, and the report states that the universal bank concept needs more work.
In the meantime, business is being lost, and not only because people are choosing to move away from post offices. Sub-postmasters and mistresses in my constituency tell me that their customers say that staff at the Department of Social Security are misleading people into believing that their benefits must be paid into their bank accounts, even though they would prefer to have them paid at the post office.
I notice that the Minister of State with responsibility for pensions, my right hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker), is present, and I hope that he will talk to colleagues about how the Department can encourage its clients to opt for the universal bank. I hope, too, that the Department will recognise that there are security advantages to allowing people to collect benefits from a post office rather than from any branch of their bank.
Mr. Byers: My hon. Friend was right to say that postmasters and postmistresses do not want a subsidy. They want to make their businesses commercially viable by moving into new areas and diversifying into new facilities. The announcement that we have been able to make today will go a long way towards assisting them.
Today's announcement will also introduce to the network a new confidence that has been lacking over recent years. We have been able to lift the cloud of uncertainty that has hung over the post office network. People can now plan ahead with confidence, as they will know the direction the Government intend to take with the network.
With regard to what my hon. Friend said about the Benefits Agency, we will make sure that benefit recipients and pensioners are made fully aware of the options and the genuine choice available to them. The big change on ACT does not begin until 2003, so there is a period in which we can make sure that the various initiatives are in place and functioning effectively. That is the challenge of the next few months, but I hope that today's statement will mean that many sub-postmasters and mistresses in my hon. Friend's constituency feel that they can plan ahead with confidence, in the knowledge that the network has a viable future.
Mr. Patrick McLoughlin (West Derbyshire): Since the House last debated post offices, I have been informed that the post office in Kirk Langley in my constituency is to close. Ten days ago, I was informed that the sub-postmistress at Brassington, who had her home converted to run the post office, has received a communication from the Post Office about reducing her wage substantially. What comfort will the Secretary of State's statement today bring to the proprietors of those two post offices?
Mr. Byers: If the Kirk Langley and Brassington post offices serve rural communities, they may well be covered by the proposals that I have introduced in connection with the protection and maintenance of the rural network. I cannot guarantee that, as I have not seen the details of the cases to which the hon. Gentleman refers, but people who read the statement will accept that there is much in it that will give reassurance to the rural network in the future.
The problems being experienced by Kirk Langley and Brassington have nothing to do with our proposals to move to ACT from 2003 onwards. They are already having difficulties. That is one of the reasons why we wanted to make the statement today--to instil some confidence in the system. I hope that in the future the
problems experienced in Kirk Langley and Brassington will be overcome, but I regret that it may be too late for those two particular post offices.
Mr. Alan W. Williams (East Carmarthen and Dinefwr): I welcome the my right hon. Friend's statement, particularly the proposals for a universal bank for sub-postmasters and sub-postmistresses to carry out a Government general practitioner role. In that context, could they also have a role as welfare benefits advisers? Sub-postmasters are in touch with the poorer sections of the community. With regard to the elderly, sub- postmasters probably know more about care allowance, attendance allowance and the minimum income guarantee than, say, Thora Hird, and such a step could be very cost-effective. Could post office employees be paid to alert the Department of Social Security to benefit fraud?
Mr. Byers: When the role of a Government general practitioner is brought forward and we can see the detail, we will be looking at the areas mentioned by my hon. Friend with great interest. We will want to know to what extent sub-postmasters and postmistresses can be trained to give good quality advice about the welfare benefits system and a whole range of other issues. They are in an ideal position to act as the interface between the Government and individuals in many communities up and down the country. Post offices provide a network that can form the backbone of communication between the Government and citizens. They have not been used in that way in the past.
The report that we have today and the Government's response to it will ensure that the Post Office network can grow in the future and move in different directions, in a way that I believe will provide greater satisfaction to many sub-postmasters and postmistresses who want to develop a Government service role.
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