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The Parliamentary Under-Secretary of State for Work and Pensions (Mr. Chris Pond): No, I am going to set the record straight. As the hon. Gentleman well knows, the memorandum to which he refers was a Jobcentre Plus memorandum, and was therefore aimed at people of working age. As he well knows, the Post Office card account, whatever its other merits, cannot help people to be ready to accept a job, as it cannot be used to accept payments of wages. That is an important message and it would be irresponsible of Jobcentre Plus staff not to get it across to people actively seeking work.
Michael Fabricant: I hope that the Minister is not saying that people of working age should not receive benefits? Is that what he is saying? Is he saying that people of working age should be discouraged from opening a Post Office card account because it would make it easier to get benefits? Of course he is not. The point at issue is that the Government and the Secretary of State denied that they were making it more difficult to open a Post Office card account, but it is clear from the memo that that process is being made more difficult. Besides, if Post Office Ltd. says that it takes 20 steps to open a Post Office card account, is it not difficult? Of course it is.
It is fair to say that many pensioners have chosen Post Office card accounts. Three million have done so, as the Government's amendment to our motion states. I have no doubt that the Minister will quote that number in his response, but the question is: how many more people would have chosen the account if the Government had made the process more simple? There are no grounds to congratulate the Government on card take-up. On the contrary, I congratulate those pensioners who, despite all the hurdles and obstacles that the Government have put in their way, have been able to open the account. It is they whom we should congratulate.
The Secretary of State for Trade and Industry became remarkably aggressive about our many concerns in the last debate. Our claims were described as "complete nonsense" and "absurd".
The Minister for Energy, E-Commerce and Postal Services (Mr. Stephen Timms): Yes.
Michael Fabricant: As the Minister confirms from a sedentary position, the Secretary of State said that our claims were absurd.
Yet, in the past few months, we have discovered that the Government have, very belatedly, started to take some steps to improve the Post Office card account process. A written answer from the Department for Work and Pensions, dated as recently as 7 June—perhaps the Minister for Energy, E-Commerce and Postal Services is not aware of this—stated:
"We have already made some improvements to the Post Office card account process where real problems have been identified and continue to closely monitor its operation. We want to make further changes which would include less form-filling and a straightforward process for customers getting account details back to DWP via their postmaster."—[Official Report, 7 June 2004; Vol. 422, c. 84W.]
At last, there is an admission that our concerns were justified. We—and the vulnerable constituents whom we serve—must be grateful for very small mercies. Yet this has taken two years to put right. Even now, Postwatch says that the changes are not as extensive as it would have liked and that they do not tackle the large backlog of applicants who are stuck in the application process.
Finally, I want to ask specific questions of the Minister. We welcome the exceptions service, under which cheques are issued to recipients of benefits, but the Government must do all that they can to publicise it. What steps are being taken to ensure that such publicity will happen? The cheque-based system is vulnerable to periods of disruption such as postal strikes, or even first-class post delivery. What contingency arrangements are in place to ensure that people will continue to receive their benefits in such circumstances? I look forward to the Minister's response.
So there we have it. I suspect that the Government do care about the vulnerable; I suspect that they do care about the elderly; I suspect that they do care about businesses that use the Post Office. But it is what the Government achieve, and what they deliver with taxpayers' money, that will count in the end.
The Prime Minister said that 2001 would be the year of delivery. That died a quiet death. With a million truants on our streets, a million people waiting for hospital appointments and a million illegal asylum seekers in our country, and with the north-south and rich-poor divides becoming even greater, there has been no delivery. In 2004, we have had the year of non-delivery—non-delivery of Britain's mail.
4.11 pm
The Minister for Energy, E-Commerce and Postal Services (Mr. Stephen Timms): I beg to move, To leave out from "House" to the end of the Question, and to add instead thereof:
"supports the Government's strategy for a viable Post Office network; welcomes the delivery by Royal Mail of 93 per cent. of first class letters the next day in the first half of 2003–04; shares the Government's disappointment over the drop in performance since then, which rightly falls short of customers' expectations; calls on Royal Mail and the unions to work together to improve the quality of service; notes that the closure of any post office is regrettable but supports the Government's view that, without rationalisation, unplanned closures would continue, leaving damaging gaps in the network; supports the Government's commitment to ensure that at least 95 per cent. of the urban population will live within one mile of their nearest post office; supports the Government's commitment to ensure funding of rural post offices until at least 2006; welcomes the changes to the urban reinvention consultation process and the extension of the consultation process from four to six weeks; supports the Government's move to Direct Payment and welcomes the fact that already more than half of customers are getting their benefits, pensions and tax credits paid straight into accounts, of which 3.2 million are Post Office card accounts; notes that the Opposition wasted millions of pounds of taxpayers' money on the Benefit Payment Card scheme; supports the facility for those who cannot be paid through an account, particularly the most vulnerable older people, to receive a cheque payment; and recognises that change was needed and congratulates the Government for its strong, decisive action."
I am delighted to have an opportunity to debate postal services and the post office network.
5 Jul 2004 : Column 561
No one disputes that the Post Office is a business that has had its problems. Just two years ago, Royal Mail was losing over £1 million every working day. It lost more than half a billion pounds in the financial year 2002–03, the year after the one mentioned by the hon. Member for Lichfield (Michael Fabricant). But last year, as the hon. Gentleman said, it made a profit—a small profit, it is true, but constituting an unmistakable sign that the business is being turned around, that the Government's policy is working and that the customers of the Post Office can look forward to big improvements. As the hon. Gentleman said, that is a considerable achievement, and it is to his credit that he acknowledged it.
The reason that turnaround is being achieved is very straightforward: the Government are investing in Royal Mail. The last Government, for 18 years, simply used it as a cash cow, scandalously neglecting the needs of the business. Today we are seeing the investment that the business needs.
Mr. Simon Burns (West Chelmsford) (Con): If everything is so wonderful because of what the Government are doing, can the Minister explain why Royal Mail missed four targets in 2001–02, 12 in 2002–03 and all 15 in 2003–04?
Mr. Timms: As I have been saying, the business is being turned around. That process is under way as we speak. The hon. Gentleman knows very well that it is not possible to go on taking money out of a business and expect it to go on generating cash. That is what the last Government did: they took up to 93 per cent. of the profits. As Allan Leighton said when the losses were at their height,
"these losses did not happen overnight".
"unresolved issues and problems stretching back for up to a decade are reflected in these results".
The truth is very simple. The investment that should have been made under the last Government was not made, and the business therefore inexorably got into the problems about which we have quite properly heard today, but which are now being addressed as the business is turned around.
Past neglect has been at the root of the problems. If a business is to be healthy, there must be investment, and the last Government did not invest in the Post Office. After the failed attempt at privatisation, they simply allowed it to drift rudderless. There was no direction, and it fell sharply behind its international counterparts. By contrast, we have given the organisation a direction, turning the business around, investing on a completely unprecedented scale, and as a result giving the business a prospect not of the depressing decline of the past but of a bright future in a dynamic and competitive market. That is good news for the people who work in the Post Office, and good news for all of us too, because we all depend on the services that the Post Office provides.
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