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Ms Hewitt: I am grateful for the suggestion.

Let me end by saying something about our investment in Royal Mail—a total commitment of some £2 billion over several years. It includes £480 million to rescue the Horizon project and ensure that we have a platform for universal banking, £450 million for the rural network to stop avoidable closures, £210 million to support the urban network reinvention, £15 million to keep open post offices in disadvantaged urban areas that would not otherwise be viable, and £750 million to repay historic debt to Royal Mail so that the renewal and restructuring plan can proceed. It is an extremely successful plan that is significantly reducing Royal Mail Group's losses and returning it to the path to profitability.

That is the commitment—£2 billion over five years—that the Government have made to Royal Mail and, in particular, to the post office network. What do we have from the Conservatives? We have a commitment to grow public spending

I am, of course, quoting from the medium-term expenditure strategy document recently published by the shadow Chancellor. What the Conservatives offer us is a freezing of the overall total of public spending for the first two years—in other words, a cut of £18 billion in public spending.

I understand that, on top of that, the Conservatives are now considering abolishing the Department of Trade and Industry—abolishing the Department that is making the investments that are beginning to turn Royal Mail around, have saved rural post offices from unnecessary closure, and are supporting an absolutely necessary restructuring of urban post offices.

I hope that when the hon. Member for Eddisbury (Mr. O'Brien) winds up the debate, he will tell us how much of the £2 billion that we have committed to Royal Mail and Post Office Ltd. he intends to cut. If, as appeared to be the case from the speech of the hon. Member for Havant, the Conservatives are saying that they want more money to go into the post office network, perhaps he will tell us how many child care

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centres he will close to pay for that, how many cuts will be made in the transport budget or how many police officers are to be sacked. Where precisely will the cuts fall? If they are to fall on Royal Mail and the post office network, everything we have heard from the Conservatives this afternoon amounts to crocodile tears, hot air, words with no commitment of resources behind them.

If the Conservatives intend to sustain the investment that we have been making in Royal Mail and post offices, in all honesty, the hon. Gentleman will have to confess to the House that, under his own shadow Chancellor's public spending plans, the cuts will fall somewhere else—on services that, in a different debate, he and his right hon. Friend will be busy defending and crying crocodile tears over.

Mr. Stephen O'Brien: Will the Secretary of State give way?

Ms Hewitt: No, I will not. I have reached the end of my speech. I just want to make the point that Labour has faced up to tough decisions as his party was never willing to when it was in government. We have backed those tough decisions with the necessary resources, against the Conservatives' commitment to public spending cuts and decline in our public services.

2.29 pm

Mr. Steve Webb (Northavon) (LD): I am glad that the Opposition proposed this subject, because it matters to Members from urban constituencies who have seen a programme of closures, and to those who represent rural and market town constituencies and, over many years, have seen one closure after another taking post offices out of villages and small towns up and down the land.

This subject is perhaps the most acute example of how those who govern are completely out of touch with those whom they govern. It is the one matter on which, when hon. Members from all parties give case after case of constituents who have received biased information or who have been pressurised or messed around, Ministers just smile benignly and tell us that there is no bias or pressure, but that there is free choice. We wonder sometimes what planet they are living on. Hon. Members from all parties have made those points, but the Government have decided to close their ears.

What the Liberal Democrat amendment calls for, which in many ways is similar to what the Conservative motion calls for, is respect for people's choices. The statistic that the Secretary of State cited in defence of the Government's position—that six out of 10 new pensioners opt for payment into a bank account—was striking. That is an extraordinarily low figure. One would imagine that of people just arriving at state pension age, eight, nine or nine and a half out of 10 would opt for payment into bank accounts. The fact that four out of 10 new pensioners think that an order book suits them best should tell the Government something: that people like that way of receiving their money.

If that is the case for four out of 10 people who have just retired, it is even more so for people who have been retired for 20 or 30 years, and who have been receiving

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their pensions in that form very happily. That works for them, so why can their choices not be respected? Every pensioner at any point could have opted for payment into a bank account. The Government have not invented that as a new choice. Pensioners have always had the option of payment into a bank account, so the fact that they have gone on getting money through an order book suggests that that is their positive choice. Why are the Government now telling millions of those people that they do not respect their choice and that they do not think that they have the right to choose the method of payment that suits them best?

Andrew Selous: The hon. Gentleman may be interested in a briefing from the House of Commons Library last year, which said that two thirds of benefits paid in Britain were paid over a post office counter, which meant that 18 million benefit recipients were using post offices to access their benefits. I am sure that he will agree with that.

Mr. Webb: The hon. Gentleman is right. The use of order books at post offices is very extensive, and reflects people's positive choice. The Government should respect that.

This is a classic case of a lack of joined-up government. One can imagine the day on which the Department for Work and Pensions felt the Chancellor leaning on it to save some money and, after sitting down to think about how to do that, came up with the idea of getting money paid into accounts rather than through giros because it was less expensive. I accept that that is less expensive, but let us guess what happened then. The DWP saved £400 million a year and the Department of Trade and Industry had to find hundreds of millions of pounds to deal with the subsequent mess in the post offices. I sometimes think that if Departments talked to each other, we would be saved many difficulties.

We have many questions to ask about how the system is going to proceed, because millions of pensioners have yet to make a decision and respond to the letters that they have been sent. The Secretary of State has cited customer satisfaction surveys, but I strongly suspect that the pensioners who are most worried about the system do not phone. They receive a letter and are anxious about it because they like the way things work and do not want anything to change, so it is put behind a mantelpiece and not responded to. The people who reply to the customer satisfaction surveys are a biased sample. They are the people who are willing to play the game and respond to the Government, so it is not surprising that they are less likely to be dissatisfied with what they get. We all know, however, of people who are being leaned on. The Government should come clean about that.

We are told that the infamous Post Office card account has been a great triumph and very successful, but I bring to the House's attention a couple of the cases now building up in my constituency in-tray. I am sure that many other hon. Members have similar examples. One constituent, whom I shall call Mrs. P, has had a card account for five weeks but cannot get her money. One does not ask much of an account, but it would not be a bad idea if it paid out money. The postmaster said that the card had not arrived, so she applied for another. He then said that that had not come, but when the lady

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insisted on checking through, he found both of them. However, the first PIN number was out of date and the second did not work, so she rang the helpline. It told the postmaster to use a blank card from the vault with Mrs. P's PIN number, but that did not work either. She then rang the Pension Service, which said that it would send her something, but that has never arrived.

That is just one example of the way in which people who have played the game and gone along with the Government have found that the system is not working. All those people wish that they had just kept their giros, because they were never told that their giro did not work, or that a PIN number was needed. They just had their giro and got their money.

Mrs. P is not alone. Another lady who has had real problems with the Post Office card account said to me:

She wondered how people were going to get their weekly money, and commented:

If someone has a giro in their hand, they get their money even if a computer is down, but what happens if they have a plastic card and the computer is not working?

I had a helpful reply on that from the Under-Secretary of State for Work and Pensions, the hon. Member for Gravesham (Mr. Pond), which said that although the matter was not really anything to do with his Department, it had contacted the Post Office,

However, the post office staff involved had now been contacted and had the correct process explained to them. So what is supposed to happen if computers go down and people cannot get their money? The Minister's reply continued:

I presume that people quite like to have their pension—

I know that the pension is not generous under Labour, but allowing people only £20 is pushing it a bit. For how long might the computer be down? Or do those people have to go back the next day for another £20? The letter continued:

not from the Post Office, but

I can just imagine the process.

None of those complications is necessary. This is not a matter of free choice for people. People ring me up to say that they want to keep their giro, but that they have filled the form in anyway because they are afraid that their giro will just be taken away from them and they will not get their pension. People are responding out of

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fear, not because they have a free and positive choice. The Secretary of State has given a misleading impression of a free, open choice.

Just to give an example of how the system is not working, the Government have said that people can get all their benefits paid into their Post Office card account, but that is not true. People cannot get their housing benefit paid into their Post Office card account. I have a Department for Work and Pensions document here: the riveting publication "Housing Benefit Direct—March 2004". It says:

So all the pensioners who have had letters asking them to move over to a Post Office card account, and who have played along with the Government, have then found that they cannot get their housing benefit paid into it. Presumably, they receive a giro for that, and go along to the post office with a giro in one hand to get that payment and a plastic card in the other, with their PIN number, to get another one. We can just see the mess, the bureaucracy and the complications.

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