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If I were an already struggling sub-postmaster or postmistress who had listened to the debate, I would be profoundly depressed. Hon. Members have mentioned that 39 per cent. of sub-postmasters and postmistresses think that their business has no future. That is very bad for morale. I would like to think that we were managing a thriving business that was going forward. The Secretary of State finished his speech by addressing the question of closing post offices, but I want post offices to be opening. Indeed, one or two post offices have opened in my constituency. There has been new, innovative thinking. Post offices have opened in clubs, pubs and on farms—in whatever other facilities are available in rural areas. Indeed, the same thing is happening in suburban areas. The closure of a post office in the suburbs causes as much hardship as a closure in a rural area. The Government need to come forward with a lot more innovative thinking. I disagree with the Secretary of State because I think that Post Office Ltd should treat its network more like a franchise, with a basic range of services that has to be
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provided and an additional range of services—a pick and mix range—that individual sub-postmasters could choose to provide, with their expertise and knowledge of their local area, so that they could make a profit and encourage customers to come to the sub-post office.

As my hon. Friend the Member for Rutland and Melton said, the Government could facilitate the availability of a range of extra services. When I intervened on the hon. Member for Richmond Park, I said that one of my constituents had written to me to say that although he would like to buy his television licence in a post office, he had to go across the road to buy it from a pub, even though he had never been in the pub in his life and did not wish to go there. He wanted to buy the licence from the post office and the post office wanted to sell it, but it was not allowed to do so. The Government could have done something about that daft state of affairs, or at least made more of a fuss about it.

First of all, the sub-post office could become the hub for all Government services. It could provide information about them, and that would bring people through the door. It is all very well to say that people are choosing not to use sub-post offices, but that is bound to happen if the range of services available is getting smaller and smaller.

Secondly, as my hon. Friend the Member for Rutland and Melton said, the Government should encourage local councils to allow people to use sub-post offices for their services. There is no reason why people should not be able to perform council tax and housing benefit transactions at sub-post offices, or why a greater range of financial services could not be made available. My hon. Friend was right to say that the Post Office should look at its contract carefully, with a view to allowing an individual office to provide whatever services it chose. For example, there would be nothing wrong with an office contracting with a local bank some distance away to provide some of that bank’s services.

Thirdly, we live in a changing electronic world, and there is no reason why sub-post offices could not provide various telecoms and IT services. Elderly people may not be able to afford—or may not want—to have computers and broadband in their homes, but they could use their local sub-post office to send or receive e-mails, for example. In addition, for foreign telephone calls, it may well be cheaper to use a Post Office telephone that operates over the internet than it would be to use an ordinary domestic telephone. The Government should encourage sub-post offices to offer a range of such services.

I want to give the Minister and my hon. Friend the Member for Wealden (Charles Hendry) plenty of time to wind up the debate, so I shall end by saying that we need to provide some certainty for the sub-post office network. The Government should announce, as soon as possible, that they have reached a definite decision on the Post Office card account. That would provide a great deal of certain income to struggling businesses. The longer the uncertainty goes on, the more post offices will close.

I hope—indeed, I am sure—that that is not the Government’s intention, but we need as many thriving post offices as possible. In particular, we must make sure that the average age of those who operate them ceases to rise as it has done recently. People feel that they are unable to retire, so we need to encourage young
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people coming out of school or university to consider setting up as sub-postmasters or sub-postmistresses and establishing thriving businesses in rural areas. If such businesses were to combine with others in the provision of services, there is no reason why the network should not thrive, to everyone’s benefit.

6.33 pm

Charles Hendry (Wealden) (Con): This brief debate has been interesting and well informed, and it has dealt with one of the most important issues affecting hon. Members today. It began with a clear analysis of the decline of the post office network from my hon. Friend the Member for Rutland and Melton (Alan Duncan). He set out the challenges that it faces, and described how the Government were wrong to try to manage the network’s decline instead of developing the new business opportunities that might sustain it.

My hon. Friend asked the Secretary of State some very clear questions, but the right hon. Gentleman did not answer them. My hon. Friend asked for an assurance that more than 2,500 sub-post offices would not close, but there was no reply. He asked how large a town would have to be to merit its own post office, but we remain none the wiser. He asked whether POCA 2 would offer a greater range of services. That question was endorsed by my hon. Friend the Member for Mid-Worcestershire (Peter Luff), the Chairman of the Trade and Industry Committee, but it was not answered.

My hon. Friend the Member for Rutland and Melton also asked for the timetable for tenders for the Post Office card account replacement programme, but we did not get that information. Most importantly of all, he even asked for the date when a decision would be made about the future structure of the Royal Mail, but not a single word was given in reply.

For those of us who have seen the Secretary of State working in the House over some years, it was perhaps one of his most remarkable performances, because he looked tired and disinterested. Perhaps his mind had moved on to his new job, where he hopes to be in a new environment as Chancellor of the Exchequer and to see his old Department abolished. That is not too surprising because, apart from the remarkable speech of the hon. Member for Cleethorpes (Shona McIsaac), not a single speaker on the Labour Benches offered any support to the Government’s position. We are talking about one of the most sure-footed Cabinet Ministers, but the Secretary of State looked extraordinarily uncomfortable in defence of his policy today.

The right hon. Gentleman says that he wants to encourage new business in the Post Office, but he simply will not take the steps necessary to make it happen. He says that there are perhaps only two options: to maintain the network as it is without a single closure and at a high level of subsidy; or, alternatively, to reduce the network and reduce the subsidy as the Government have proposed. What he has completely ignored is the third way, which I would have thought would be obvious to him. One would have thought that he would want to explore the amazing range of new business opportunities for post offices in order to make more of them economically viable so that more can stay in business with less subsidy to keep them that way.

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I am sorry that the right hon. Gentleman is not in his place to hear what I am saying, as we had a remarkably interesting insight into Darling economics— [Interruption.] Here he comes, so I will wait for him to resume his place. I am more than willing to go over the earlier part of my speech again, so that he can hear what he missed. We had an astonishing insight into Darling economics: if one post office closes because the sub-postmaster wishes to take a redundancy package, the Post Office may instruct another post office nearby to close and transfer to the new location.

What the right hon. Gentleman is saying essentially is that the Government would tell a private business, which may have been operating for years in a particular location, serving its community and understanding its customers, that it must close and move to a new location in a community that it does not know, losing all the consumer good will built up over time. What if the postmaster declines to do so? What if he says that he wants to stay where he is and carry on serving the community? It is quite clear from what the Secretary of State said that the postmaster may be told that he may not do so, as his branch may be closed and a new person found to set up the other branch.

At the heart of the debate is the extraordinary amount of affection that all our constituents have for the post office network. The hon. Member for Richmond Park (Susan Kramer) mentioned it in her speech and almost every intervention and speech by a Back Bencher referred to people’s enormous affection for it. Yet we all know that it goes beyond that: it is not just about affection, but how we can bring new business into the post office network. The hon. Member for Richmond Park spoke about post offices becoming a hub for packages that couriers cannot deliver, but she went on to ruin her argument with an economically illiterate funding arrangement, whereby the Post Office would be separated from the Royal Mail, which would be part-privatised and the funds used to subsidise the separated-off post office network.

We have heard significant discussion about the Post Office card account. My hon. Friend the Member for Rutland and Melton, introducing the debate, spoke about the near compulsion on people to have their pensions paid into bank accounts. The hon. Member for Richmond Park talked about the letter sent to people when they retire, urging them not to go to the Post Office, but to use the banks instead. My hon. Friend the Member for Rugby and Kenilworth (Jeremy Wright), who has campaigned strongly on these issues, rightly said that the Government must bear some responsibility—indeed, the lion’s share of it—for the problem.

The Secretary of State says that the use of bank accounts rather than the Post Office has been the result of a long-term change, but when we were in government, we never put the same sort of pressure on people to use the banks. People did not get the same letters then, and they were not rung up—as elderly, frail and vulnerable people often are today—and told not to use the Post Office, but their banks. Under the present Government, we have seen an unparalleled level of pressure applied on people to put their pensions into a bank account rather than into the Post Office.

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I am not surprised that the hon. Member for Cleethorpes is not in her place to hear the wind-up speeches or any responses to her remarkable 22-minute speech. She started off by saying that we should close post offices, albeit none in Cleethorpes, and then developed an argument on why post office closures are right. I do not agree with her, but she is a brave person, with a majority of 2,000, to take that position. I hope that her comments will be widely publicised in her local newspapers—in fact, in a spirit of good will, I am prepared to help her by sending a copy of her speech to her local press and pointing out what she is saying on behalf of her constituents about why their local post offices should be closed.

The hon. Lady highlighted other issues, such as the fact that British Telecom bills do not tell customers how they can pay their bills at a post office—but has she done a single thing about it? Has she ever written to British Telecom to point out the omission and to ask it to change its practices? Hers was an extraordinarily weak speech—one that was apparently designed to shore up the Government’s position, but failed to do so.

My hon. Friend the Member for Beverley and Holderness (Mr. Stuart) took us on a cycling tour of his constituency and explained how the post office is the hub of every community. Were I to go on a cycling tour of my constituency, the doctor’s surgery would be the important hub that I sought in every community. He spoke about the social roles that post offices play and highlighted the way in which many sub-postmasters are being ground down and demoralised by the lack of long-term vision for a post office network.

My hon. Friend the Member for Cotswold (Mr. Clifton-Brown) summarised effectively the sense of disappointment that all of us felt at the Secretary of State’s lacklustre speech and the great contrast between that and the vision set out by my hon. Friend the Member for Rutland and Melton, who is indeed a one-man think tank on the post office, with a raft of ideas for its future.

Some 5,000 post offices have been closed since the Labour Government came to power. That means that, in 10 years, taking into account the announcements made in December, 40 per cent. of the post office network will have closed under Labour. That is a national issue. As the hon. Member for Vauxhall (Kate Hoey) said, closures affect urban areas every bit as much as rural areas. In Wales, 250 post offices have closed; in my constituency, a third have closed in the past five years.

We know that we owe a huge debt of gratitude to the sub-postmasters and sub-postmistresses for the work they do in serving their communities. They deserve better than they are getting from the Government. The Government’s decision on the future of the network has been based on how many post offices they think they can get away with closing, rather than on a real business case or an understanding of what consumers want and need. The Secretary of State’s vision is to have fewer post offices providing fewer services to fewer people.

A month after the statement, far too many questions are still unanswered. A raft of parliamentary questions were tabled following last month’s statement, but the Minister for Consumer Affairs and Competition Policy,
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who is one of the most delightful men in government, has been unable or unwilling to say what proportion of closures would be urban or rural. He cannot give a precise figure for the social network subsidy, which implies that it could well be less than the present £150 million a year. He cannot say how much will be invested in improving Crown post offices or how many Crown post offices will close in the next three years.

The Minister has made no assessment of the likely environmental impact of closures, despite the Government’s professed commitment to avoid unnecessary car journeys in order to protect the environment. Whatever happened to joined-up thinking? He cannot give us details of the level of support for mobile post offices. We still do not know whether press reports that the Post Office wanted to close 7,000 of the 14,000 sub-post offices were true. He cannot tell us what a local community would have to do to avert a closure—indeed, he does not even tell us whether local communities will have a say.

We are seeing a massive missed opportunity. Worst of all, the Government’s policy does not recognise that the problems caused by the closure of the post office often result in the last shop in a community closing as well. The debate is not only about our post offices; it is about the whole of the communities in which so many of our constituents live. The Government should be announcing ways to develop the Post Office, allowing it work with carriers other than Royal Mail. They should end the restrictive practices and enable the problems of unfair competition to be tackled. They should be working with local councils to encourage them to offer more council services through post offices. Conservative councils are already doing that by encouraging people to pay their rent and access other council services at post office counters. We should be doing more to give post offices the flexibility to offer a wider range of businesses services than is currently permitted, and we should be considering imaginative approaches such as those employed in Wales, where the Welsh Conservatives in the Assembly have announced plans to support local post offices through help with business rates and expansion of the post office development fund.

The debate has highlighted once again the paucity of the Government’s thinking on the issue. We need a real long-term vision for the future of the post office, not the Prime Minister blaming the consumer alone; the Government have been responsible for many of the problems but they have failed to come up with a vision. We need that vision. We need a long-term structure, but we do not have one and as a result we are destined for more years of uncertainty, decline and dissatisfaction.

6.45 pm

The Parliamentary Under-Secretary of State for Trade and Industry (Jim Fitzpatrick): I take as my starting point a quote from the hon. Member for Wealden (Charles Hendry). On BBC News 24, when it was put to him that

the hon. Gentleman said:

That says it all.

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For our part, we know there is a problem; we know that we have to address it and try to come up with solutions. I shall outline how we intend to deliver them and return later in my speech to the solutions proposed by the Conservatives and the Liberal Democrats.

I agree with the hon. Member for Wealden that we have had a useful debate about the future of the post office network, a subject of great relevance to the House. We keep coming back to it, and I am sure we shall continue to do so during the consultation period and right through to the announcement from Post Office Ltd in the summer. As always in these short debates, a number of questions have been raised and I shall try to deal with them in due course.

In the proposals now out for consultation, the Government clearly demonstrate their continuing commitment to the post office network. Our proposed strategy between now and 2011 is intended to maintain a national network of post offices, and to enable Post Office Ltd to undertake modernisation and some reshaping to put the network on a stable footing for the future. Since 1999, the Government have committed about £2 billion to support the network. Under our new proposals, we envisage that up to £1.7 billion will be provided between now and 2011 to support the Post Office—to support the social network and to pay for the wider necessary reconfiguration and modernisation that are key elements in achieving a firm basis on which to move forward.

At the heart of our strategy is clear recognition of the important social and economic role that post offices play, particularly in rural and deprived urban areas, and of the need for ongoing public funding to support them. We also propose to underpin that commitment to a national network by introducing new access criteria for post office services, which will include specific provisions to protect vulnerable customers.

Overall, nationally, 99 per cent. of the population will be within 3 miles of a post office and 90 per cent. will be within 1 mile—hardly a framework for destruction of the network, as has been alleged by some Members. Within that framework, there will be changes. Up to 2,500 post office branches will close, with Government-funded compensation to sub-postmasters who leave.

Sir Robert Smith: Will the Minister give way?

Jim Fitzpatrick: If the hon. Gentleman will forgive me I shall not give way now. If I have time towards the end of my speech, I shall certainly take interventions, but I want to cover points raised in the debate, when, with respect, he was not in the Chamber.

It would be wrong to take things out of perspective and to dismiss the fact that the remaining network of about 12,000 post office branches will still be more than the entire UK banking network. Furthermore, Government support will enable the Post Office to open at least 500 new outreach locations, to provide access to services for smaller and more remote communities, using mobile post offices and post offices in other locations such as shops, village halls, community centres, or mobile vans. There will also be changes to the network of Crown post offices to restore that segment of the network to profitability, but Post Office Ltd will consult locally on those changes, as with all other changes in service provision, before taking final decisions on its proposals.

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