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Mr. Weir: Does the hon. Gentleman agree that the situation is worse in Scotland, where a greater number of people bank with the Royal Bank of Scotland, the Bank of Scotland and the Clydesdale than with the banks that offer the post office service?

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Dr. Cable: The hon. Gentleman is right. I tabled a question to the Secretary of State for Scotland a couple of weeks ago. We did not reach it, but it made precisely that point. I think that in Scotland about 90 per cent. of the public will not have access to the service. They will have access only through the basic bank account, with all its limitations. For those people and the people who do not have bank accounts at all, the Post Office card account is clearly the mechanism of choice if they have an unrestricted choice between the three mechanisms open to them.

Mr. Kidney: Before the hon. Gentleman goes on to discuss the Post Office card account, will he say whether he agrees that it is as important for the future of our post offices that those bank accounts work through the Post Office, as the Post Office card account does? They are both important—it is not a case of one or the other.

Dr. Cable: I completely agree. We can criticise the Post Office card account, but the Government are at fault for failing to pursue banks that are not operating the full service. They should be named and shamed, particularly in Scotland. The banks have got off lightly. They have not been regulated after the Cruickshank report, which pointed to overcharging. They have offered a minimal service, and they think that they can get away with it. The Government should be demanding that NatWest, Abbey National and the rest offer the same services as their competitors. On that basis, the hon. Member for Stafford is right.

Mr. Kidney: I very much agree with what the hon. Gentleman has just said, and shall give another example of sub-postmasters' complaints. One sub-postmistress rang one of the banks to say that she had a customer who wanted a basic bank account, but the person at the bank said, "I don't know what that means."

Dr. Cable: I shall press on specifically with the Post Office card account. The Conservative spokesman made two criticisms of the way in which the Government have approached that account. First, there is the absence of a level playing field for the three options. Secondly, there is the problem of complexity. Opposition parties can make such points, but I want to refer to a neutral source. In his speech, the Minister referred admiringly to Postwatch, the regulator. However, he may not have noticed what Postwatch, in its evidence to the Select Committee on Trade and Industry, said about those specific points. Ms Foster from Postwatch said:

"Post Office Limited had an agreement with the Department for Work and Pensions . . . that all three accounts have to be mentioned at the same time and the fact that the Post Office card account had to come third on that list . . . our main concern is that it is appearing to be much more difficult to open a card account at the post office than to open a basic bank account. Consumers have to go through eight steps, which have been outlined to you in this submission, and for a lot of people who are not familiar with these account systems and banking systems, these seem to us to present unreasonable barriers."

My colleague, the hon. Member for West Aberdeenshire and Kincardine (Sir Robert Smith) asked Ms Foster:

"Can you think of any reason why they have been put at a disadvantage?"

She replied:

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"I am mystified as to why the DWP has made it quite so difficult."

That is the impartial Postwatch, which the Minister prayed in aid a few moments ago. It is also worth reminding him that Postwatch offered to help the Department for Work and Pensions and the Post Office with the pilot studies, but the Government refused to accept that offer.

However, Postwatch may be too committed a source of evidence, so may I cite some remarks by the Deputy Prime Minister? The Minister may recall that a few weeks ago, the National Federation of Sub-Postmasters, having despaired of getting anything out of the Department for Work and Pensions, asked to seek the Prime Minister. However, he was busy with the war in Iraq, so he referred the federation to the Deputy Prime Minister, who had a look at the problem. In Deputy Prime Minister's questions I asked him specifically about the fact that the application had eight stages which, through his intervention, he had managed to reduce to seven. He replied:

"I am grateful for the hon. Gentleman's remarks. He makes a fair point that the postmasters felt there was too much bureaucracy in the development of the new card system".—[Official Report, 2 April 2003; Vol. 402, c. 905.]

The problem was therefore acknowledged by the Deputy Prime Minister himself.

I have read carefully the Minister's testimony to the Select Committee, in which he gave a series of reasons why the process is complicated. There are issues of security and, in addition, all the problems involved in applying for a bank account, such as the problem of establishing identity. We acknowledge that those are genuine problems. However, given the people we are talking about, those obstacles should be reduced to the absolute minimum. I shall cite some more testimony given to the Select Committee—a particularly valuable exchange between the hon. Member for Kingswood (Mr. Berry) and Mr. Mills, the chief executive of Post Office Counters. It reads as follows:

"Mr. Berry: So there is nothing that can be done to make the system easier than it currently is?


Mr. Mills: I absolutely did not say that.


Mr. Berry: Yes, but, with the greatest respect, I would like to be perfectly clear about what you are saying. You are saying, therefore, that it could be made easier?


Mr. Mills: Yes.


Mr. Berry: There would be no technical problems, in your view, to making it easier?


Mr. Mills: No, absolutely."

So the Post Office says categorically that the system could be made easier. Any obstructions are not coming from within the Post Office. They are not inherent in the process of ordering a Post Office account. They are being created in the Department. We have not just the views of Opposition parties or dissident Back Benchers; we have the testimony of Post Office management, the Post Office consumers body and everybody outside who has examined the issue.

Chris Grayling: There was printed evidence as well, in that all the material distributed by the Department for the launch of the child benefit alternative of

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withdrawing money from the post office placed the Post Office card account on the back page, at the bottom, in small print, and the other alternatives in the front, highlighted, with big flashing neon arrows pointing towards them, effectively.

Dr. Cable: That sounds like a fair summary of what took place, and I endorse it.

I turn not to my pensioners in Twickenham, who want to operate through the banking system, not to the people who, despite the obstacles, will eventually be able to get the Post Office card account, but to the people who will not be able to access the system at all and who will fall within the exemption system. What worries me—again, evidence of this came before the Select Committee—is the total lack of preparation. The Minister seemed to imply that there was a process going on. If it is going on, he has not told the Post Office. Mr. Mills, the chief executive, was taxed about the problem by Labour Back Benchers.

The exchange was initiated by the hon. Member for Ilford, North (Linda Perham), who asked:

"Can you think of any other alternative for people who obviously cannot use a bank account or the Post Office card account?"

Mr. Mills replied:

"I am sure we could. We have not been asked to yet."

The hon. Member for Preseli Pembrokeshire (Mrs. Lawrence) asked:

"Have you been consulted about what it should be?"

to which Mr. Mills responded:

"No, not yet."

Nobody has asked the Post Office what the exemption service involves. I do not know whether the Minister sees that as the Post Office working independently, but surely the people at the sharp end, the people who run the post office network, should have some idea of what an exceptions service entails, and they say that they have not even been asked.

I return to the basic economics of the network. We all agree that if pensioners and others need access to the post office in order to draw their cash, the post offices must be there. One of the fundamental problems is that if post offices are closing, it becomes more difficult for that to happen. We see that in our constituencies. There is a programme—the ludicrously entitled urban reinvention programme—that is cutting a third of all branches. We have all seen it beginning, but we do not know where it will end because we are not told and we are not given a list of closures. So far I have two in my constituency. The immediate consequences are greater difficulty of access for those in the areas affected, and greater crowding at post offices and longer queues. Access is being reduced daily under the closure programme.

Joyce Quin (Gateshead, East and Washington, West): I apologise to the House for not being present at the beginning of the debate, as I was attending a long-planned event on EU enlargement. There are post office closures in my constituency, and I know that consultations are part of the closure process. Can the

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hon. Gentleman tell me whether any consultations have resulted in a reversal of the proposal to close? If he cannot tell me that, perhaps he can ask my hon. Friend the Minister to tell us, when he replies, whether there are any such examples.

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