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14 Jun 2006 : Column 281WH—continued

What is happening is that each Department that uses, or did use, the services of the Post Office branches is allowed to go off on its own, and there is absolutely none of the joined-up government that we were all told about back in 1997; there is no co-ordination at the centre. I should like the Minister to tell us clearly who actually makes the decisions. Is it the Department of Trade and Industry or the Department for Work and Pensions? Why was the issue not discussed beyond the Department for Culture, Media and Sport? For the BBC, it was a sensible commercial decision, but for a large number of post offices, it is yet another slice of income and another step nearer the grave.

At some stage, someone will have to make a grown-up decision, because no decision is being made at the moment. We have not yet had a debate on the Floor of the House. We have debates only in Westminster Hall, thanks to energetic Back Benchers who bring the issue up at fairly regular intervals.

Mr. Alan Reid (Argyll and Bute) (LD): I agree with the case that the hon. Gentleman is making. Does he agree that the BBC should have a duty to make available to people in rural areas and on islands points where they can renew their licence? There are several islands in my constituency, just as there are in Orkney and Shetland, and there is no pay point on them. The BBC should not have awarded the contract to PayPoint, whose computer tells people where the nearest pay point is as the crow flies. In my constituency, that means that people would often have to swim across two or three miles of water.

Mr. Paterson: That is a valid point. It is not relevant to landlocked North Shropshire, although we have a few meres, but it is a good point, and perhaps the hon. Gentleman should take it up with the chairman of the BBC. It is a clear example of how an agent of Government activity such as the BBC, which takes large amounts of taxpayers’ money, makes a decision on its own because it makes sense from its point of view in terms of spending its pot of public money.

The point that I am trying to make is that there is absolutely no co-ordination. Someone will have to
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make a grown-up decision on how that Government money is spent—and to keep the network going, Government money will have to be spent. Instead, the Department for Work and Pensions goes off on its own, without any consultation, imposing trials in a brutal manner. I would like confirmation that the result of the trials will be revealed to Parliament, that we will have a chance to debate them before the matter is taken further and that we will not get any more dictatorial letters basically bludgeoning vulnerable, nervous pensioners into taking their payments direct when they do not want to do so. That is one thing on which we really need a promise—a promise that there will be a proper statement to Parliament on the results of the trials, and that we will afterwards debate the subject properly on the Floor of the House.

I also want a complete guarantee that someone in Government will then stand up and say, “Yes, I am the Minister in charge of these various activities. I will co-ordinate things, and here is our strategic view for the future,” because, bluntly, we just do not have one. The subject affects too many people. I shall quickly give the figures to remind the Minister just how big the issue is. According to the National Federation of Sub-Postmasters, there are 7,854 rural post offices and 12 million customers a week. Some 84 per cent. of the rural population live within 1 mile of the post office, 75 per cent. of rural post offices have a shop attached and 58 per cent. of rural residents use the attached shop once a week or more. Frequently, the post office is the only place where one can withdraw cash, because only 4 per cent. of villages have a bank, but 60 per cent. have a post office.

I shall end on the universal bank. I went to see the Chief Secretary to the Treasury, and was told, “Don’t worry, there will be changes; we will bring the Post Office into the commercial world, but you will pick up new business. You will get the universal bank.” However, from parliamentary questions that I have asked, we now know that some substantial banks are still not part of the scheme, including HSBC, Halifax, Bank of Scotland, the Royal Bank of Scotland and Abbey.

My final question is: what steps are the Government taking to bring in banks that are not part of the scheme? It is no good closing down some of the Government areas of activity and promising that the private sector will pick them up if that is not being done. However, the question to which I really want to know the answer—this is probably the third time I have asked it—is who will get a grip on the problem, and who will come up with a coherent, clear strategy for the 14,400 post offices? At the moment, we do not have such a strategy, and post offices are suffering death by 1,000 cuts. Very large numbers of post offices will go unless the Government wake up.

Several hon. Members rose—

Hywel Williams (in the Chair): Order. A number of Members still want to get in, so may I ask hon. Members to keep their speeches short? I intend the winding-up speeches to begin at 3.30 pm. I call Pete Wishart.

3.13 pm

Pete Wishart (Perth and North Perthshire) (SNP): It is a real pleasure to speak under your chairmanship,
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Mr. Williams. I congratulate the hon. Member for Orkney and Shetland (Mr. Carmichael) on raising this important issue.

All of us who represent rural constituencies understand the value of the post office to our constituents. We also understand the adverse impact on communities when post offices are lost. When I travel around my constituency, I observe that there is almost a constant assault on the infrastructure of our small villages and towns. If it is not the post office, it is the local bank; if it is not the bank, it is other community facilities in the constituency. When I look round my small villages and towns, I observe that there are three things that define a community. One, obviously, is a post office; the second is a local school; and the third is a local pub. It is those things that give a set of houses a character that defines them as a community, and it is these things that we really need to fight to maintain in order to ensure that our villages and small towns continue to be viable.

The term “post office” is a complete misnomer; it gives no suggestion of the full range of activities that they undertake, or of the myriad functions that they provide. As well as selling stamps and all the rest of it, they are now probably the only part of the retail sector in some small towns and villages. There are a couple of post offices in my constituency where people can buy their petrol, for example. There is also a place where local arts and crafts can be bought and are used as a means to entice tourists, show them what is available in the locality, and encourage them to spend some time in these wonderful rural areas.

The point has also been made that post offices serve a key local function, providing local information to people. It is, on occasion, where people meet to go to other community events, and they provide a great social hub. Some of these places are more like community centres than just post offices, and on that basis are worth maintaining. We call the people who look after such places sub-postmasters, but they are much more than that. They are almost part social workers, part care attendants, and on some occasions provide an almost pastoral role; they might say, “Wee Jeanie is far too late; she’s not turned up at her usual time this week.” They can sound a gentle alarm bell, asking, “Is she okay? Is everything all right?” They provide that sort of role. Some are almost like lifestyle gurus and personal advisers, and we can see their impact on their community.

That is why I believe that the threat to our rural post office network has disastrous consequences for our villages and small towns. When a post office closes, it means that people have to travel much further to access some services. That affects even the more active members of the community. Around half the people who use post offices walk to them. If that post office is closed, it means that a car journey is involved, and then the health benefits are lost and the environmental impact of that is brought into play.

For some more elderly, frail members of our community, and groups such as disabled people, the post office is a lifeline; they require post offices in order to access all the critical services that they need daily. Postwatch showed us that when post offices close, the
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business does not automatically transfer to the post office in the next town, because as a car journey is involved, going there is more of a hassle, and probably people will go to a larger town in order to access those services, so there is a net loss in business for such post offices. We can see that there is an impact, in terms of those businesses continuing to be sustainable.

It has been recognised by everyone who has spoken that a subsidy is required if post offices are to continue to operate. They are loss-makers. Someone mentioned that 90 per cent. of all post offices are unprofitable and require some sort of support. In order even to start to be self-financing, or even approach profitability, they need a unique selling point, and traditionally, they have had that; it was the range of products that they could sell. So it is almost perverse that post offices are losing business, but are, at the same time, being deprived of essential services by Government. The Post Office card account has been mentioned several times already today; it is of crucial importance to the post offices being able to process benefits, including child benefit and unemployment benefit. All those things are essential as part of their core business, but they are being deprived of that. They are asked to be sustainable, while they are being deprived of those essential services.

Perhaps we could go to the post office in future to get our ID cards; perhaps that could be a means to try to resurrect some sort of business for local post offices. It is unfortunate and unfair that we have identified that post offices have a profitability issue, but we are not giving them support; in fact, we have taken away from them the very things that could make them profitable and self-sustaining.

My gut suspicion is that the Government want out of the whole business of post offices; that is what I really believe. I read with great alarm the remarks by Adam Crozier, who spoke of an “imperative” need for a “radical transformation” of the networks as a result of the collapse of Government work, such as benefits and pensions payments. He reckoned that such payments have fallen from 60 per cent. of the work that post offices do to 10 per cent. He said that it is simply not sustainable to have 1,000 offices with fewer than six customers each. When I read such remarks, it gives me the clear impression that the Government do not want anything to do with the businesses, which they view as more of a millstone than a real service.

I look around the Chamber and recognise the people here; I observe that there are lots of Scottish Members here, and I think that we are all in the 10 largest rural constituencies in the whole United Kingdom.

Mr. Paterson: And Shropshire.

Pete Wishart: Shropshire is, too, I am told by the hon. Gentleman. [Interruption.] Well, I am in the presence of so many people who represent large constituencies—

Julia Goldsworthy: None of them Labour Members, though.

Pete Wishart: That is the point; it is unfortunate that there is only one Labour Back Bencher here. I am grateful to the hon. Member for Rhondda (Chris Bryant) for contributing, but where are the others? We
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really need to engage in this debate. We need to tell others what it is like in rural communities, and how important post offices are.

For the reasons that I gave, I believe that the Post Office should remain in the public sector; a public sector ethos is required for the Post Office to survive. It is imperative that it be given a subsidy, given the centrality of its functions in rural communities. I have to say that I look with alarm at some of the proposals brought forward by the Liberal Democrats, including part-privatisation. I have observed part-privatisation in other public sectors in Scotland, and the disastrous consequences.

Mr. Carmichael: It is estimated that the Post Office network—never mind the Royal Mail—requires something in the region of £2 billion of extra investment over and above that already put in. If that is not to come from our proposals, where does the hon. Gentleman suggest it should come from?

Pete Wishart: I am grateful to the hon. Gentleman for mentioning that. It is obviously a UK figure and, with great respect, it is the Scottish element that concerns me. The Liberal Democrats boast about their partnership arrangements in the Executive in Scotland and money was found for what they call the abolition of tuition fees, and for free personal care. This issue is so important to the centrality of communities that the money has to be found. Clearly, money was found for those pet projects of the Liberal Democrats, which we supported, so we should be able to find the money in the public sector to do that. I have real concerns that if we go down the part-privatisation route, the situation could be made worse. I caution communities and sub-postmasters to look carefully at the Liberal Democrat proposals and see the dangers inherent within them.

I will conclude because I have taken eight minutes. Rural post offices have to be maintained. A public sector ethos must be attached to them and a subsidy must be maintained in order to do this. They are central to our communities, they are worth fighting for and I hope that the Minister listens to us very carefully—and I hope that the next time we have one of these debates, he brings some Labour Back Benchers with him.

3.21 pm

Mr. Geoffrey Cox (Torridge and West Devon) (Con): I congratulate the hon. Member for Orkney and Shetland (Mr. Carmichael) on securing the debate. I shall be as quick as I possibly can in the hope that someone will be able to follow me.

I represent the district of Torridge and the borough of West Devon, which together form my large constituency. I can tell the hon. Member for Perth and North Perthshire (Pete Wishart) that it is the second largest in England. It is a remote and sparsely populated constituency that shares many of the problems that rural constituencies experience. I imagine they are very familiar to those around the Chamber. I am delighted to be one of two representing the south-west of England—the other is the hon. Member for Falmouth and Camborne (Julia Goldsworthy).

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Our communities share the following characteristics: we have a fragile rural economy; a dearth of affordable housing; an ageing population; social and health services in deficit struggling to reach isolated communities; and a lack of investment and employment opportunities. Those are exacerbated by the threadbare public transport network, and there is a sense that our communities are under strain.

This week’s report from the Commission for Rural Communities surprised no one—except perhaps the Government—in its portrayal of the reality of rural disadvantage and poverty. At the same time, the countryside—certainly the south-west of England—is undergoing a major, painful change. The state of livestock agriculture is a subject on which many hon. Members have spoken many times. I do not wish to paint an exclusively pessimistic and gloomy picture, but there is no doubt that the blow after blow sustained by the industry has driven it nearly to the edge of extinction.

When we see countryside communities in the midst of such turmoil and change, familiar institutions provide the confidence that small communities need that there will be continuity and that there will be a future for them. Par excellence, the institution that most gives comfort to rural communities, which sends the message that their definable identity and character will survive the changes through which they are going, is the rural post office.

Familiar institutions assume great importance in the circumstances of rural communities at the moment, and the post office is an outstanding example. As other hon. Members said, it is at the very heart of the identity and character of a village. It is a centre of social life, which reassures people that the community to which they belong is remembered and recognised by the outside world.

A sub-postmaster in a small village in the countryside does not enter his occupation seeking monetary reward. Many of them have spoken to me of the gratification it gives them to feel that they are central to the community in which they live. They can engage in friendly conversation with an elderly resident who lives alone, for whom that visit is the one recreation of the day, and they miss them and ask after them if they do not come, as the hon. Member for Perth and North Perthshire said. That is a vital social function.

I recently completed a survey of every post office in my constituency. Benefits and pensions are collected through the Post Office card account by 9,000 people. There are about 60 post offices in my constituency and well over 90 per cent. replied to my request for information, for which I am grateful to the postmasters and postmistresses. Of those 60 post offices, 79 per cent. are more than 2 miles from another post office and 46 per cent. are more than 5 miles. The Post Office card account is relied on by 58 per cent. of them for more than half their income and by a further 23 per cent. for over a quarter of their income. How do the Government believe that they can survive if the card account is withdrawn?

Of those post offices, 77 per cent. said that their business would be in jeopardy if the card was not continued or replaced by something similar, and 66 per cent. would have to lay off part-time or full-time staff. Other services are provided by 90 per cent. of them, such as the village shop or newsagent. Where will
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people go, how will the services be delivered and where will the residents, many of them elderly and without transport, go to conduct the business they need?

It is vital that the Government plainly and unequivocally commit themselves to the future of rural post offices. They must confirm that they will develop a replacement for the Post Office card account and that they will continue to recognise the important social function fulfilled by post offices. They should, without delay, announce that they will work with Post Office Counters Ltd to develop new services and that they will not divert card account holders to bank accounts in the meantime.

Steadily and relentlessly, the foundation of the rural post office network is being eroded. The hon. Member for Falmouth and Camborne mentioned South West Water’s disgraceful letter, in which it encourages people to use PayPoint, which does not exist in half the villages in my constituency, to pay for water. One might mention SWEB Energy key recharging—another function that has gone.

When the Government offered the lifeline of the card account, sub-postmasters embraced it and made it a success. Despite the discouragement of six or seven different forms and the cold welcome given by Department for Work and Pensions officials to prospective card holders, 4.5 million signed up, many just to support their local office. Despite the subsidy and the as yet unrenewed commitment to preventing avoidable closures, it is no wonder that so many who spend their lives in small rural post offices distrust the Government’s word.

They will be looking with anxious expectancy upon today’s proceedings and listening intently to what the Minister has to say. It is essential that the Government do not let them down. They should provide a raft and lifebelt to this vital social function, which these people, who are so important to the lives of rural communities, genuinely deserve.

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