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Mr. O'Brien: I have heard about that practice and the hon. Lady raises an important issue. Guidance and encouragement to do the right thing to sustain the relationships and incomes of post offices is needed and it is for the Government to take action. It is in the Government’s gift to influence such matters and they should not wash their hands of that.

The local post office often becomes a community focal point. People often congregate there and the police, local authorities and tourist organisations often display and provide information in them. They are increasingly places where people can go online if they are interested in doing so. Above all, we all have a shared responsibility in our communities and they are places where we can look out for one another. I am sure that we all know of someone in our community—perhaps an elderly person—who has gone to the post office when they were not well. They may have wanted to remain in their own home but have struggled out and the sub-postmaster or sub-postmistress did not face that person down with something that they would find embarrassing and difficult to deal with, but waited for a friend to come into the post office and alerted them quietly that the person they saw earlier might need looking after. That is such an important and valuable part of what post offices do in the centre of our communities. They help to preserve dignity and independence. I know that that happens almost weekly at one of the most enterprising small post offices in Wrenbury in my constituency, which Neil and Janet Palmer run to great effect. They are the centre of their community.

We should not lose sight of the fact that there is a multiplier effect in having a post office in the vicinity. Clearly, those who call into a post office will spend money elsewhere, not least if they are able to obtain cash because that is where the first, essential spends are made.

With incomes declining, the trend to non-viability and the fact that it is becoming increasingly difficult to make the idea of becoming a sub-postmaster or sub-postmistress attractive for people, particularly young people and young couples, to take over, the pressures of technology and the greater mobility that we all have means that we tend not to walk to a local service but to jump in the car. The question that then arises is, “What can the Government do about it?” They have the power to make decisions about state benefits and, particularly, how pensions are paid. Given the trend and the Government’s efforts to pay pensions electronically into accounts, there has been a substantial reduction in income from encashments. The National Consumer Council said in 2003:

and the new arrangements

As we have heard, the Post Office card account was brought in in 2003 and it was said at the time that it would not be restricted, but earlier this year we found that it would be for only seven years. We have already had an important discussion about the major effect that that will have on the ability of businesses to plan and to receive investment support, and for confidence. What was amazing about the announcement in January was that the Government said that that was always
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intended. It cannot have been always intended if we knew nothing about it. I certainly remember the announcement because I was sitting where my hon. Friend the Member for Wealden (Charles Hendry) is sitting now. I well remember our hot debates to try to obtain a commitment that the card was sustainable and would not be limited.

Three years after its introduction, we learn from written answers—the information has only just been revealed—that the Post Office card account with 4.3 million users in the United Kingdom, providing 10 per cent. of the post office income, will be axed by 2010 with massive loss of revenue. No Post Office-based replacement has been announced. I hope that the Minister will be able to reassure us that there will be a son or daughter of POCA. The matter is important to us all and our constituents, not least the 1 million people who have signed the NFSP’s petition.

We heard in interventions about the loss of the BBC television licence contract, which, with other bill payments, represents 5 per cent. of Post Office income. The encouragement to renew vehicle excise duty online has shown a lack of commitment from the Government to encourage services to be provided by post offices as part of the underpinning of their social and community responsibilities and as part of a strategy that goes hand in hand with the commercial activities of the Post Office, which must run efficiently. There is the difficulty of gaining full recognition by the banks that they should see post offices as an extension of their network. That should be strongly encouraged, and I would have thought that the Government could do something to encourage that recognition. With rising costs, we are faced with the real possibility of closures. I am sure that the NFSP’s brief will be familiar to many hon. Members.

The problem is not just the inconvenience, although that is a particular difficulty for those with no transport or with mobility problems, and for older people; the problem is also that, in this more environmentally conscious age, closures will inevitably increase the use of the car, as people will have to go much further to reach a post office. Half of rural residents currently walk to their post office. We will find that increasing dependency on others becomes a feature of our communities, but many older people will simply not look for the assistance that they need, and they will often suffer quietly behind closed doors. We MPs have a duty to take real note of that.

Above all, community spirit will be badly affected. A spirit is always difficult to define, but we know when we have lost it. It is certainly difficult to rebuild. It is not an exaggeration to say that the post offices in our communities give strong evidence of community spirit. The loss of those facilities would have a very negative impact. Of course, if there is a multiplier effect, it will work both ways, including in a negative way.

I hope that colleagues throughout the House will join me in calling on the Government to undertake an urgent examination of the social—that is, the rural and urban deprived—post office network. I fully endorse what the NFSP says: a strategy is needed to combine the commercial and social activities. We have to accept that, as a matter of public policy, such a strategy will not necessarily be funded purely by commercial activities. It may need support, in which case we will
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need a review, so that Parliament and Government can come to a decision on the allocation of public resources to support a vital social and economic network across the UK. In the meantime, the Post Office can certainly encourage the use of services that can be delivered at post offices.

Communities must be put first, and we insist that central and local government use post offices as their primary outlet for information and services. We recognise that people want the continuing ability to feel an identity and belong to their communities, and want basic things, such as the ability to run their finances with cash rather than a bank account. That is a perfectly proper thing to do, and it can often be a much better budgeting process for those who have the least. We should not prescribe in either way, as there are plenty who would want a bank account, but the unremitting trend of alienating cash from the way that people think about managing their affairs is inappropriate and somewhat patronising.

Community value is strategic and is in the public interest. Our community services, epitomised by the local sub-post office, are the test by which we decide whether we can call ourselves a cohesive society. I call on the Government to act now, before it is too late. At the very least, I hope that the Minister will today announce the dates of the Department of Trade and Industry’s public consultation on the future of the social post office network.

10.3 am

Mr. David Drew (Stroud) (Lab/Co-op): I congratulate the hon. Member for Eddisbury (Mr. O'Brien) on bringing this well-worn topic back to Westminster Hall. It does not matter that we are going over old ground; until we get clarification of exactly what the Government want to do with the post office network, and of the plans on how to deliver services in rural areas, we will retread the same ground.

I welcome this morning’s debates. I see this as a three-hour debate; I hope that all hon. Members will stay for the second part, which is on the future of affordable housing in rural areas. To me, the two subjects are inextricably linked. It is no good talking about service provision unless we consider who lives in rural communities, and how they can afford to live in them.

I start by laying down a challenge. Too many rural communities want to maintain their services, but do not think about how they will do that. All rural communities need to regenerate themselves. They either grow in a sustainable way, or they die.

Bob Spink: The hon. Gentleman is a well known campaigner and fighter for rural communities, but does he acknowledge that post offices are important to urban communities, too? They have been hit hardest over the past five years, with the number of urban post offices falling from about 9,000 to only 6,500. They are just as important to vulnerable people.

Mr. Drew: I take that as a slap on the wrist. I agree with the hon. Gentleman, but I am here to talk largely about my experiences in a semi-rural area. The way in which we look at the link between rural and urban areas is absolutely essential.

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Julia Goldsworthy rose—

Mr. Drew: I give way to the hon. Member for Falmouth and Camborne (Julia Goldsworthy), who will talk about the Sustainable Communities Bill, which I was about to talk about, although she will get her plug in first.

Julia Goldsworthy: I thank the hon. Gentleman for being so generous. I shall refer tangentially to the Sustainable Communities Bill. The hon. Gentleman talked about the importance of rural communities and their wider sustainability, in terms of supporting services such as post offices. Does he agree that, unfortunately, rural communities are often hamstrung and have no control over important aspects of their future sustainability, such as over the growth in the number of second homes? At the moment, there are no restrictions on that growth, which is one of the key drivers in undermining the social, economic and environmental sustainability of many rural communities.

Mr. Drew: I thank the hon. Lady for that; of course, I agree with her. I shall push on and try to connect some of the points made.

I stress that in the Sustainable Communities Bill—I hope that the House will treat that subject increasingly seriously—there is at least the idea of a strategy on how local communities can take back power and responsibility, as they perceive, at least, that they have lost it. I think that often that is a perception, rather than a reality, but of course if a community has an out-of-town shopping facility, that is a reality that it cannot escape from.

There are three levels, and we have to start at the level of the individual. Too often, individuals complain about the loss of their post office, pub or village school, yet they drive past that school with their children, or drive past those facilities to the supermarket, or they work 200 miles away. That may well be the nature of the world that we live in, but it is not a good world, a sustainable world, or a world that will be fit for purpose in this decade and beyond. The adage “use it or lose it” applies, and too often we lose it, because people become concerned about a facility only when it is about to close. That is sad and reprehensible, but it is avoidable; we must start with the individual.

One of the problems with the Post Office card account is that too few people in the know have signed up to it. I have signed up to it; that is a moral responsibility to which I have adhered. I hope that the decision-makers see the value of it, and run it alongside bank accounts. It was never supposed to be a pure alternative to the bank account; it was supposed to be a different way for people to withdraw money. I know that that is not the Minister’s responsibility, but he has to talk to the Department for Work and Pensions about what plans it has for POCA. We just need coherence. A lot of people signed up for POCA because it is easy and successful, but also because they believed that that was how to keep their post offices open. Let us build on that.

Next, we move on to the level of the community. I believe that the whole community has a responsibility
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to its service provision. I declare an interest: I am still a town councillor in my town of Stonehouse. We were faced with the post office not necessarily closing, but being moved from a specially built building, and with a possibly deteriorating service. The town council, because it had money, invested in that facility and took the whole building on; now, the town council building abuts the post office. To me, that is the best of both worlds. A lot of smaller community councils do not have the money or wherewithal to do that. However, when they produce their annual report for their parishioners, they should state whether they have engaged with their post office and service deliverers in order to determine whether there are things that they could do better together, whether there is a mutual support mechanism, and whether they should go out to their community and say, “We need to invest in those services.” The idea of the common bond and the money that could be raised therein is not a fantasy. People can sign up to the belief that their services are important, and they can put their money where their mouth is.

The Library’s debate pack provides an excellent run through the issues. I am featured on page 3—I hope that it does not go to my head—in a story about Paganhill in my constituency. Paganhill post office was situated within a one-stop shop. There is a Tesco less than a mile away, but Tesco took on the one-stop shop and announced that it intended to move the post office out. Catastrophe! The community were up in arms, but what could they do about it? It just so happened that the Maypole hall, which was round the corner from the post office, was willing to consider assimilating the post office. It was a long saga, but 18 months down the line, 10 days ago, the new, refurbished post office opened in the Maypole hall.

There were three heroes: Alan Churchill, who chairs the Maypole hall committee, Robin Craig, who has taken on two sub-post offices and is looking to take on more, and Cyrsta Harris, who works for Stroud district council in its community development department. They all worked hard to make the transfer happen, and it is people like that who keep our services alive. Tesco, the Post Office and others played a part, but that is what is vital: people have to make things happen, otherwise services will be lost.

I was in Oakridge yesterday, a small village on the outskirts of my constituency. Mike and Kim Gorney live there, and she runs the sub-post office. Two hamlets, Oakridge Lynch and Far Oakridge, came together to keep a sub-post office going throughout all the recent difficulties. She has run it for the past 12 years, but Mike and Kim want to move in order to improve and extend the post office and introduce longer opening hours. I do not want to pre-empt the planning process, but I hope that they receive permission. Yesterday, they took me through how they will fund the development, and they are looking for help. One important aspect of the figure of £150 million is that it is supposed not only to pay a pure subsidy to keep businesses going, but to reward innovation. However, when the Gorneys look for funds, it always seems that the funds are spent up or they are not the right ones.

The last two pages of the excellent debate pack refer to the different funding streams available. The rural
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capital start-up subsidy scheme has gone, to be replaced by the rural re-start scheme. Interestingly, it has to be match-funded, and the Gorneys made it clear how difficult that is. When one raises money to buy a building and undertake much of the work, one has to pay for the movement of counters, security and so on. The rural investment fund was launched in October 2004, but it has only £1 million. Against the thousands of post offices that are trying to keep themselves going, let alone improve, it is not a great sum of money. I hope that my hon. Friend the Minister will explain how we can bolster it. Many post offices are able to take advantage of the rural rate relief, but it does not help when one moves a business. A small rural post office is already likely to have drawn down that money.

The Government need to be clear. They cannot keep withdrawing services. The Post Office card account is a classic case of worthy investment, and to announce that it will be run down over the next couple of years and replaced with bank accounts is not good news, because it is a psychological kick in the teeth. People have invested a lot of money in their business and they have run it not to make money. The submission that I think we all received from the National Federation of Sub-Postmasters shows that the average drawings are less than £1,000 a month. There are some bigger post offices, but as the submission says, it means that an awful lot of people take substantially smaller sums than even two years ago. They are minuscule. However, those people are heroes, and that is why communities owe them an obligation. It is no good saying, “Isn’t it terrible that they no longer want to carry on and nobody wants to take this business on from them?” One must be slightly mad to take on those businesses, such is the level of reward; however those people are true heroes and they should be rewarded financially and because they are key people in their communities.

The issues to do with the Driver and Vehicle Licensing Agency, which the hon. Member for Eddisbury highlighted, and that TV stamps saga all give out the wrong signals. They may not be problematic as discrete decisions, but collectively they are doing immense damage.

Sir Robert Smith: Those issues not only send the wrong signal, but downgrade a service. In my constituency there are 41 sub-post offices in which people can obtain a TV stamp, but there are only 16 PayPoints. It seems rather sad that the two organisations could not come together to work out how they could have maintained a mixed system in rural areas. The Post Office could have assisted people, as it has with banking, and reached further into the rural community.

Mr. Drew: I agree. I shall refer to the ATM issue, because I seek clarification from my hon. Friend the Minister about their—and perhaps other services’—introduction in rural post offices.

The Post Office sold me on the hub and spokes idea, whereby the main post office, which the Post Office might own, becomes the hub and uses its delivery mechanism to work in tandem with sub-post offices. As the hon. Member for Eddisbury said, they can remain independent private businesses, but it does not mean that they cannot co-operate. It is far better they do,
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rather than compete against one another and fail, with all those businesses suffering as a result.

I make no apology for concentrating on rural businesses, because they are under greatest threat. We have been through the urban reintegration issue, but I hope that my hon. Friend the Minister will clarify where the hub and spoke idea has got to. It affects what we do in Stroud, but it seems to happen by accident. Perhaps it happens by osmosis, but it does not seem to happen by design. It is not as well planned as it could be, and I want to know that sub-post masters and sub-post mistresses are being given all the help that they require to keep their businesses going, expand them and co-ordinate them with others.

The hon. Member for West Aberdeenshire and Kincardine (Sir Robert Smith) referred to banking and financial services. It is a crucial issue, because the whole system needs to hold together. Last week I received from the Post Office a long press release about the installation of ATMs in more sub-post offices. Even though my hon. Friend the Minister does not speak for the Post Office, he can talk to the Post Office, and I read into the press release that ATMs would be free of charge. We need to build up a bond of trust with customers and keep them using post offices, and if there are no banks easily accessible for miles around, they could be tempted to use ATMs and allied services. Foreign exchange has been a huge success story recently.

I want the process clarified. It is no good putting out press releases if we do not know what they mean in detail. If the post office is to become the community’s financial hub, we want to know that it will be invested in properly, and that it will be affordable, which means that we do not charge the poorest people more than they would pay if they could get to a bank. We have to make the process as easy as possible.

The challenge exists, but it will not be met by the Government alone. Communities and individuals bear a responsibility, too. The Government must set the strategy correctly and put the money in, and clearly £150 million will not be enough next time. We shall have to consider how we revisit and rework what we are doing in the more urbanised areas, as we are now considering the true urban centres, which face somewhat different problems. That is the challenge. I hope that we can move forward, and this debate has been a worthwhile opportunity to do so.

Several hon. Members rose—

Mrs. Joan Humble (in the Chair): Order. Before I call the next speaker, I want to point out to the hon. Members who are trying to catch my eye that I hope to call the speakers from the Front Benches soon after half-past 10, so brevity is the order of the day.

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