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24 Apr 2007 : Column 222WH—continued
I have questions for the Minister about how the Government intend their proposed criteria to be implemented by Post Office Ltd in rural areas. The proposed rural area criteria state that 95 per cent. of the
total rural population should be within three miles of a post office. The phrase “total rural population” is worrying because it implies that some regions could see swingeing cuts. We already know that the 38 remote postcodes that now do not meet the criteria of 95 per cent. of the population within six miles will be exempt from further closures. That is good news, and I welcome it. However, it has inevitably created real worries among people in neighbouring remote communities, who fear that their post offices may be taken away.
For example, as I am sure the Minister knows, the post office in Fort Augustus at the southern end of Loch Ness is one of the best used in the highlands, serving large numbers of tourists as well as local people and businesses. It is successful and essential to the community. However, the neighbouring villages of Invergarry and Invermoriston are within exempt postcodes, so people in Fort Augustus are inevitably worried. I have also received strong representations in similar circumstances from the Kirkhill community about their post office.
Mr. Geoffrey Clifton-Brown (Cotswold) (Con): The hon. Gentleman may recall that during the last Opposition day debate that we had on post offices, I raised the problem of access criteria. The problem is that they are an average. Furthermore, we do not know what definition is being applied to rural areas—do they include suburban areas as well? If the criteria are an average and suburban areas are included, we may well find that the access criteria go down to 80-something per cent. rather than 90-something per cent. That would mean that constituencies such as the hon. Gentleman’s and mine—mine is not quite as remote as his, but it is very rural—could suffer more post office closures than otherwise.
Danny Alexander: The hon. Gentleman makes an important point. I add that the words “rural” and “remote” were not defined in the Government’s consultation, so it is impossible to understand exactly what is meant. The Minister may wish to elucidate or clarify that point in his response. I hope that he will be able to; if not, the uncertainty to which the hon. Gentleman referred will certainly continue. Although the Minister cannot necessarily be expected to comment on the fate of individual post offices, can he at least offer some reassurance to people in remote postcode areas where there is only one post office, such as Fort Augustus? Presumably, it would be wrong to close the sole outlet in such an area.
There is also the problem of remote and rural postcode areas where a post office has recently been closed. For example, in the last year or so the post offices at Tomatin, Laggan, Cromdale and Glenurquhart in my constituency have all closed, supposedly at a time when we have a policy of no avoidable closures.
Mr. Russell Brown (Dumfries and Galloway) (Lab): Will the hon. Gentleman explain why those post offices closed?
Danny Alexander:
I suspect that if I were to go into all the reasons for each case in detail it would take up more time than I have available. Broadly speaking, most of those post offices closed because the
postmaster did not want to carry on and so far the Post Office has not been able to find anyone to take over. That is a point to which I want to return, because it is important.
Andrew George (St. Ives) (LD): Although I do not think that my hon. Friend would argue that we should keep post offices open for reasons of sentimentality, does he not accept that the problem is that successive Governments created the conditions for failure by withdrawing services, which meant that many small post offices clung on despite the fact that they were placed in severe financial hardship? Those Governments have not given the post offices the freedom or the opportunity to expand their services.
Danny Alexander: I am grateful for that intervention, which anticipates a point to which I am about to move on.
In the context of the post offices that have closed, if reopening those offices is necessary in order to meet the criteria that the Government have laid down, will the Minister ensure that that happens? Ministers have implied, at least, that after this round of essentially driven closures, no more post offices will have to close. That implies that they intend to make it financially worth while for people to take on post offices such as those that I have mentioned. In that context, the continuation of the social network payment is welcome.
The Parliamentary Under-Secretary of State for Trade and Industry (Jim Fitzpatrick): Will the hon. Gentleman confirm that for the post offices to which he referred in response to my hon. Friend the Member for Dumfries and Galloway (Mr. Brown), where the postmaster retired or moved on, efforts are being made to recruit replacements?
Danny Alexander: As far as I am aware, efforts are being made to recruit replacements. One of the problems with recruiting replacements for a number of post offices is the uncertainty about the Government’s plans, not only about funding, but about the provision of other Government services. That makes it harder than it should be to recruit replacements in such communities where post offices are necessary. If the funding and the services are not there to enable the post offices to move forward, it seems that we might be going back to where we started, with the rural post offices allowed to wither away, but with 2,500 fewer post offices than we started with.
Mr. Clifton-Brown: I thank the hon. Gentleman for giving way; I promise not to intervene again. Does he not find the Minister’s intervention deeply unsatisfactory? If the postmasters and postmistresses are going to be offered £60,000 to retire, it will be difficult to recruit new, younger people to run that post office when they see the climate that the Government have already produced for post offices, with subsidies and further Government services likely to be withdrawn. Surely we should be freeing up the Post Office to allow post offices to do more business, whatever business they want to do.
Danny Alexander: I agree entirely with the sentiments expressed by the hon. Gentleman. He makes his point very well indeed.
Looking at the criteria, it seems that as well as the small villages and remote places that I have discussed so far, rural towns—market towns—could be hard hit, particularly those with more than one post office. For example, Nairn, in my constituency, has three post offices: one on the High street, one on Harbour street and one in Tradespark. Each is well supported and provides an essential and highly valued service to the distinct community that it serves. However, when the ministerial slide rule is applied it seems that places such as Nairn may—we await the response—be left with fewer offices. In the case of Nairn, that seems utterly wrong.
It now seems that Crown offices in rural towns also face closure and are being reassigned to businesses such as WH Smith. That has happened in Fort William in the constituency of my right hon. Friend the Member for Ross, Skye and Lochaber (Mr. Kennedy). People are understandably concerned that the consistency of service may be threatened and that experienced post office staff will be made redundant.
Mr. Jeremy Browne (Taunton) (LD): There are obviously particular concerns and problems in villages where the post office is the only retail outlet, but, in the case of the small towns that he mentions, does my hon. Friend share my concern about the impact of closing a post office on surrounding businesses, such as newsagents or greengrocers, which lose a large slice of their custom when post offices close?
Danny Alexander: My hon. Friend makes a tremendously important point. The footfall generated by a post office on a high street or in a section of shops in a small town is crucially important not only to the post office. The beneficial effect—the glow that comes out of the post office—spreads more widely than the post office and other businesses that might be located within it, to neighbouring shops and other businesses.
In relation to the Crown post offices, there is also a feeling of a loss of accountability. There is no comeback for the community if the business in which the post office is located closes down or chooses to relocate. That is exactly what happened in Balloch, in my constituency, when Somerfield closed its store. Many months later, the residents of Balloch are still waiting to have their post office restored. What guarantee can the Minister give that the new franchise arrangements will not go the same way? Does he want to see such franchise arrangements extended elsewhere?
Mr. Russell Brown: The Crown post office, or the directly managed service, in Dumfries went to a Spar shop. In recent weeks, we had significant problems—I shall put it no other way. Great efforts were made to find someone else to take over the business and that happened, but I assure the hon. Gentleman that at the time of the changeover Post Office Ltd gave a clear commitment that, irrespective of what happened, if the owner of the shop decided that they could no longer run the business, an alternative would be found. Post Office Ltd has come good on that, even after a fortnight’s delay.
Danny Alexander:
The hon. Gentleman’s intervention is reassuring, although it seems perhaps surprising that an arrangement should be put in place that has such an inherent degree of uncertainty. The
commitment that he has described from the Post Office to ensure continuity of service is important, but I am afraid that that is not something that they have been able to secure in Balloch.
We have to ask ourselves why post offices are in such difficulty. Ministers will say that demographic and technological changes are largely to blame, but some new technology—eBay, for example—benefits post offices. Of course, post offices have to adapt to the changes, but the Government should help. Instead, they have been taking business away. The Minister might wish to quote with approval the briefing from the National Federation of Sub-Postmasters for this debate, but he should be careful. It states that
“we regard this programme as unfortunately necessary...in view of the scale of withdrawal of government business from the network in recent years and the consequent viability of some sub post offices.”
In other words, Ministers have taken away with one hand and are now using that as an excuse to take away with the other.
The loss of the television licence has caused real damage to post offices. We cannot blame the BBC alone for that; a responsible Government would have stepped in to prevent such a damaging change. Restoring the ability of post offices to sell TV licences would, to my mind, be a welcome step in the right direction. One of the major advantages that post offices have is their ability to reach the parts that other financial providers simply cannot or will not reach. Post offices have the capacity to be the engine room of financial inclusion, enabling groups who are often excluded, such as the elderly, the disabled and those without their own transport, to access financial services.
I had hoped that that would be part of the Government’s vision of financial inclusion, but in the recent financial inclusion report, the Economic Secretary to the Treasury confirmed the Treasury’s blind spot where post offices were concerned. A dismissive reference to the Post Office card account and a Panglossian reference to the post office closure programme were all that could be managed in a lengthy report. That is very worrying, particularly when the new contract for POCA is considered. POCA should be seen as a step towards financial inclusion, not a barrier to it. For example, additional features could be added to make it more useful to those who want them and want to stay with the Post Office.
In his reply, will the Minister update us on his thinking on the matter? I welcome the fact that the new contract for the POCA is proceeding. When will it be awarded? I regard it as essential that it goes to the Post Office. Without it, many post offices will lose vital footfall, and the pattern whereby the loss of Government’s business sounds post offices’ death knell will continue.
When the new replacement POCA is introduced, it must be made as easy as possible for new and existing customers to access, without any of the hurdles created when the Post Office card account was first introduced. The Government should also be working hard to persuade banks to allow access to their accounts over the counter at post offices. Installing free automated teller machines is certainly helpful, but enabling bank customers to carry out transactions on their account at any post office is what is really needed.
Fundamentally, this debate is about the importance of providing Post Office and postal services on an equal
basis to every citizen, no matter how rural or remote their community might be. That is a principle in which Liberal Democrats believe firmly and in which we are prepared to invest, but there are warning signs that others wish to erode it. The proposed closures in rural areas are one such sign. Another is Royal Mail’s application to charge a premium on business mail to the highlands and islands. To many, that seems to be the thin end of the wedge for Royal Mail to undermine the universal service obligation that results in letters and parcel services being charged at the same price across the country.
If the subject matter of this debate is crucial, so is its timing. There are 10 days to go until the local Scottish parliamentary and Welsh Assembly elections. Labour party leaflets circulating in my constituency suggest that the Minister’s party colleagues, unlike him, are unwilling to accept responsibility for addressing the decline in rural post offices. I am sure that in 10 days’ time, many people will use their vote to remind his colleagues of that responsibility.
11.22 am
Mr. Elfyn Llwyd (Meirionnydd Nant Conwy) (PC): I congratulate the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Danny Alexander) on securing this debate. It is an important issue, and the timing is quite good as well.
The closure programme is not a new thing—it has been going on for some time. I recall that in the small village of Ganllwyd in my constituency, an elderly lady ran a post office from her own home. She gave the Post Office 12 months’ notice that she was giving it up, and a local garage proprietor, who also owned a bakery and a shop, bid for the franchise. He was rejected summarily for not being a fit person to take over. In those days—there was a huge turnover of about £2 million—he was denied the opportunity. I rang the person concerned at the Post Office, and we had such an argument that she went on the sick for a week afterwards, but the Post Office reconsidered and my constituent took over. That post office has been very successful.
The ethos of cutting away at the network has been around for some time, and the present Government have accelerated it by taking away work from post offices. We in north Wales have the unenviable task of watching Labour Members of Parliament run around campaigning to keep post offices going—in fact, that was the main issue in a recent by-election in south Wales—when they voted for the closure programme. I do not know how cynical people can get, but I know that our constituents are considerably more intelligent than new Labour thinks they are.
We all know how important it is to maintain the network. I will not repeat what has been said by the hon. Member for Inverness, Nairn, Badenoch and Strathspey, who put the case eloquently and well, or what was said in the interventions that he took. I live in a small village outside the town of Bala that has one shop. The postmaster there tells me that he is actively thinking of giving up, because work has been consistently taken away from him and he has been denied any opportunity to expand. When he applied for grants, the problems that he encountered were such that in the end
he just gave up. He is becoming more and more disheartened, and we in the locality are becoming more and more concerned.
If he were to close, that would be the end of our village shop. Effectively, the next post office is five miles away by bus—if the bus is available and at a certain expense. I am thinking of elderly people. We in this Chamber have reasonable earnings and can afford to travel back and forth as we wish, but sadly many people in rural areas rely on bus services that are not up to scratch.
Mr. Cash: It is somewhat ironic that reducing post office facilities in rural areas is likely to lead to an increase in car use. If people in small villages, particularly the elderly and infirm, can get to their post office on foot, taking away that post office will increase car use.
Mr. Llwyd: The point is well made and is absolutely right. Mention was made earlier of the Government’s own figures on service in rural areas—that 95 per cent. of the total rural population will have access to a post office within three miles. I do not know where those figures come from. In parts of my constituency, the nearest post office is already 10 to 15 miles away, even before the closure programme. I have mentioned the distance of five miles, which is a relatively benign example, but others in my constituency must travel 10, 15 or 20 miles.
I do not know how the figures are worked out, but I know that three or four definitions of “rural” are being used in various Departments. I should like to know what the definition is, and whether, when discussing total population, second homes are taken into account. Are those figures factored in as well? I know that urban areas will also suffer from the changes, but I cannot recognise the figures or relate them to anything that I understand about the rural network in north and mid-Wales.
There is some hope, because we have been told that the card account will have a successor. We are all celebrating that announcement, albeit guardedly, but at the beginning we thought that the card account would be here to stay. When we looked at the small print—these are typical new Labour tactics—we found closure in 2010. As my dentist tells me frequently, new Labour announces that it is going to chop off both our legs, and when it chops off one, we celebrate because it is not as bad as we all thought.
The Government can do much more. Banking facilities have been referred to, and there is no reason why a full suite of banking facilities should not be available in our post offices. In Wales, we have taken a rather different view of things. We allow some post offices 100 per cent. rate relief, because we acknowledge that they are extremely important to the fabric of rural communities. Let us not forget that very often the post office is a social centre as well. It is a place where people meet. If Mrs. Jones does not turn up for her newspaper two days running, people begin to think, “Is she all right?” It is an important social gathering place.
The notion was proposed some time ago that post offices could become a one-stop shop for Government information—local government, central Government and the Assembly, as far as I am concerned. I think that that could be done, and that some form of payment should be made for delivering that service.
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