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Sir Peter Soulsby (Leicester, South) (Lab): I too am deeply concerned about the proposal of Post Office Ltd
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to close 70 Crown post offices and replace them with inadequate alternatives—in Leicester’s case, in the basement of a nearby newsagent, which makes the branch far less accessible and is wholly inappropriate for such an important public service in a major city. I hope the Secretary of State will encourage Post Office Ltd not just to discuss the details of the move, but to engage in proper discussions with the local council and local people about the principle of the serious erosion of an important local service.

Mr. Darling: I understand that most of the pilots conducted with WH Smith have been warmly welcomed. Of course in some cases the service on offer will need to be improved, and if that is a particular problem in Leicester it will need to be examined. However, as I have said a number of times today, in the face of the problem that the Post Office has been losing business, any opportunity to secure new business and persuade more people to visit post offices must be a good thing. I think it odd that people are turning their backs on that opportunity, because I do not see how we can keep those 70 post office branches open otherwise. Collaboration and joint ventures must be a good way of securing additional business.

Mr. Nigel Evans (Ribble Valley) (Con): This is a bleak day, not just for the post office network but for rural villages up and down the country. The hon. Member for Chorley (Mr. Hoyle) said that an average of four post offices were closing in each constituency. If that were the case, we would at least know roughly where we stood, but I suspect that some constituencies will be left untouched while post offices in rural villages are attacked. The closures seem to be taking place on a cost basis, because the post offices are losing £4 million a week. How much money does the Secretary of State expect to save at the end of the exercise, and what protection will rural post offices be given?

Mr. Darling: I realise that the hon. Gentleman will not have had an opportunity to read the Government’s final proposals—although, having heard his question, I suspect that he would probably say the same if he had read them. The proposals set out access criteria for rural and urban areas that will safeguard post offices. Safeguards have been added, partly at the suggestion of the Trade and Industry Committee, to ensure that areas are not disadvantaged. In some parts of the country—I do not think they include the hon. Gentleman’s constituency—there are so few branches that the Post Office may have to open new ones to ensure that the national criteria are met. I believe that those criteria are the best way in which to guarantee access.

Mr. Nick Raynsford (Greenwich and Woolwich) (Lab): My right hon. Friend has emphasised the importance of access criteria to ensuring that the Post Office has the right post offices in the right places to maximise business. In Woolwich, we have a Crown post office that is incredibly well located and extremely busy at almost all times of the day. It is difficult to envisage even a half-competent management not being able to run that post office successfully and profitably, yet out of the blue, with no prior consultation with local
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people, comes a proposal to move it to a far less well-located WH Smith branch that is already very crowded. The consultation proposals seem derisory to me. Will my right hon. Friend please instruct the Post Office, as part of the access criteria, not to move needlessly post offices that can operate profitably in their existing locations?

Mr. Darling: As my right hon. Friend says, the decision was made by the Post Office. As he has raised the matter, I will see whether it is possible for him to sit down with Post Office representatives and discuss the logic and the rationale behind the move, but, as the House will appreciate, I am not in a position to make detailed comments about that particular branch.

Anne Milton (Guildford) (Con): I share the deep cynicism of my constituents about any public consultation these days, believing that it rarely results in any change at all. Post offices are the social glue that holds our communities together. They offer an essential lifeline to many people and their presence keeps open many parades of small businesses. Is the Secretary of State aware that there will be devastating consequences if these proposals go ahead? Is he aware that my constituents in Guildford and Cranleigh do not believe that the public consultation will have any impact at all?

Mr. Darling: The facts that led me to come to the House to make these proposals have not changed: the Post Office is still losing £4 million a week, double what it was losing two years ago. As I have said, the option of sitting back and doing nothing is not sensible, and the National Federation of SubPostmasters has said explicitly that the present situation is unsustainable. That is why we need to do something. On consultation, many points were made, especially in relation to the criteria, on which we have strengthened the position. I hope that that will protect people in both urban and rural areas. Frankly, it is disingenuous for people to say that somehow we do not have to make any changes, and that everything will be all right. It will not.

David Lepper (Brighton, Pavilion) (Lab/Co-op): I welcome what the Secretary of State has said about the future of the Post Office card account, but the concern of many small businesses in the Lanes and North Laine area of my constituency—the main customers of the Crown office, currently in Ship street—is that its transfer to a WH Smith branch some distance away will make it less rather than more accessible for them. I believe that they are right. They are also concerned that consultation will not take place until July, on a decision that clearly has already been made.

Mr. Darling: Perhaps I should make the same offer to my hon. Friend as I made to my right hon. Friend the Member for Greenwich and Woolwich (Mr. Raynsford). I have probably made this point on a number of occasions but it bears repeating: the Crown office network is losing £70 million a year. We have to do something about that. If there are opportunities to get more people into the post office building, that must be good for the post office; above all, that will keep it open.

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Mr. Roger Williams (Brecon and Radnorshire) (LD): I sincerely hope that the proposed consultation will be more transparent than the one on which the Secretary of State has reported today. In Wales, as well as consulting local authorities and right hon. and hon. Members, will he involve Assembly Members and the National Assembly for Wales?

Mr. Darling: Yes. The National Assembly and the devolved Administrations in Northern Ireland and Scotland will be consulted.

Chris Ruane (Vale of Clwyd) (Lab): First, I am pleased and relieved that the two Crown post offices in my constituency—in Denbigh and Rhyl—will remain open. I concur with my right hon. Friend that the challenge is to get more footfall in through the door. To this end, Welsh Labour MPs have convened a meeting next Thursday with the high street banks, the Treasury, the Wales Office and the Minister with responsibility for the Post Office, along with the Post Office and the National Federation of SubPostmasters, to see whether we can look at best practice within the industry and spread it to increase the footfall, especially in rural areas and areas of financial exclusion.

Mr. Darling: That sounds like a worthwhile initiative, and I know that the Under-Secretary of State for Trade and Industry, my hon. Friend the Member for Poplar and Canning Town (Jim Fitzpatrick) will attend that meeting.

Mr. Robert Walter (North Dorset) (Con): The Department for Work and Pensions informed me yesterday that two of three jobcentres in my constituency were closing, so it has not been a good week for Government announcements of closures. However, there is a little bit of good news. On Monday, after a long period without post office services, a new post office counter opened in the village of Hazelbury Bryan in my constituency. I hope that the announcement today will not be taken with a degree of irony by the residents of Hazelbury Bryan. Will the Secretary of State assure me that the kind of innovation that brought that post office counter to the village, involving a neighbouring sub-postmaster providing the service, could be used to save all 45 post offices in my constituency?

Mr. Darling: There are many examples of innovation that have meant that post offices will build their business and maintain branches, if not open new ones. On jobcentres, I am very much aware that that network is being reduced as well. However, I think that I am right in saying that at the last election, the hon. Gentleman stood on a platform involving the wholesale closure of jobcentres.

Mr. Mark Todd (South Derbyshire) (Lab): Perhaps the Secretary of State will turn to his ministerial colleague and warn him of the unrelenting diet of Adjournment debates that he is likely to face on this subject once the lists are announced. When will the Post Office be advised either to produce a sensible transaction offer that is competitive and would win
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business such as BBC licences, or to give sub-postmasters the opportunity to join the Paypoint network.

Mr. Darling: A number of branches have Paypoint. Also, the changes that I am proposing will cut some of the Post Office’s costs, so it will be better placed to win contracts. The Post Office lost the BBC contract because the BBC was able to save substantial sums and, understandably, decided that it wanted to spend that money on programmes rather than transaction costs. That is one of the reasons why we need to make these changes.

Hywel Williams (Caernarfon) (PC): Plaid Cymru welcomes the intention to give the devolved Administrations a greater say in shaping the network into the future. I am sure that the Secretary of State is relishing the prospect of working with the excellent new Government established in Edinburgh yesterday. Turning to Wales, what regard will be given to the particular needs of the objective 1 areas, which have been defined objectively as areas requiring particular help in terms of economic and social needs? Will the Secretary of State work with the Administration in Cardiff to that end?

Mr. Darling: Of course the Government will work with the devolved Administrations, and as I said a few moments ago, the Post Office will do that as well, as part of the programme. I indicated earlier that there are two degrees of protection that will help Wales; one is the additional protection for people living in deprived urban areas as a result of the consultation, and the other is additional protection for the more rural areas. The hon. Gentleman is sitting next to the hon. Member for Angus (Mr. Weir)—the sole Member representing the SNP in the Chamber today—who raised this at the Select Committee, and he will be pleased to hear that in his constituency and in areas in the Highlands and Islands, there is the possibility not only of having no closures but of gaining additional post offices.

Ms Karen Buck (Regent's Park and Kensington, North) (Lab): There are 15 Crown post offices where a franchise partner is being sought but has not yet been identified, one of which is Maida Hill in the Harrow road in my constituency. This is not only an area of extreme urban deprivation, but a struggling urban high street that the local urban regeneration agencies have been working to try to turn round. Will the Secretary of State assure me that the Post Office and the Department will work with those urban regeneration partners to make sure they are fully involved in the consultation? What factors will determine whether areas of high urban deprivation face losing any of their service?

Mr. Darling: I understand my hon. Friend’s point perfectly; she has already raised the matter with me. This is perhaps the other side of franchising; in this case the Post Office is having difficulty finding somebody to go into a joint venture. On her general point, it is often the case that when a post office has difficulties, the surrounding shops have difficulties too. That is something that the Post Office, the council and other agencies need to look into.

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Mr. Alan Reid (Argyll and Bute) (LD): May I draw the Secretary of State’s attention to today’s written ministerial statement from the Department for Work and Pensions, which says that the Post Office card account will be available at personal teller outlets located throughout the UK? Could we have much more strictly defined criteria that will ensure that people can collect their pensions throughout the Highlands and Islands? When the Government gave the television licence contract to Paypoint, it meant that although there were still outlets available to my constituents, large parts of my constituency—the rural parts and the islands—lost the ability to buy a television licence over the counter. Will the POCA tender contain strict access criteria concerning the rural parts of the Highlands and Islands?

Mr. Darling: Yes, the Post Office card account will be used across post office counters, but we also want to make it usable in automated teller machines to give the card account holders more flexibility. As for the BBC licence fee, that decision was taken by the BBC. The Government do not control the BBC, as we know only too well; every morning when I get up and tune in to the “Today” programme it is pretty evident that the Government most certainly do not control the BBC. The BBC took that decision because it saw that it could save substantial sums. As my hon. Friend the Member for South Derbyshire (Mr. Todd) said a few moments ago, we must encourage the Post Office to get into a position where it can win more business, not only from the BBC but from others as well.

Kate Hoey (Vauxhall) (Lab): The Secretary of State keeps repeating the obvious: that he cannot force people to use postal services. However, does he not understand that he can ensure that Departments do everything they can to put business the Post Office’s way? The public cannot understand why on one hand we are putting in investment to keep the rural network going, while on the other hand we are taking away services, which is losing the Post Office money.

Mr. Darling: At the risk of irritating my hon. Friend by stating another obvious fact, let me say that Government Departments too must have regard to the costs that they incur in providing services. In some respects I would prefer the subsidy to be more transparent, so that people could see that we are putting money into the Post Office, rather than giving it a tacit subsidy through requiring Government Departments to do something that they would not otherwise do. However, the important thing is to ensure that, regardless of how that happens, the post office network is subsidised. As I said, unless it continues to receive a public subsidy the network will shrink drastically, which no one wants.

Tony Baldry (Banbury) (Con): The Secretary of State said in his statement, “We also want to encourage community ownership. There are already some 150 thriving community-owned shops, many of which already incorporate post offices.” However, there are also hundreds of thriving privately owned shops that incorporate post offices. If the Secretary of State lauds community ownership—as I am sure that we all do—why does he want to undermine privately owned
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shops that incorporate post offices? Yesterday I presented to this House a petition signed by hundreds of my constituents who are concerned and want the post offices and sub-post offices in their villages and in Banbury and Bicester to remain open. Why does the Secretary of State want to undermine them?

Mr. Darling: The 13,000 post offices are private businesses. They are run by postmasters and postmistresses who either operate a post office as their exclusive business or, more usually, run one in conjunction with some other business activity. Only a tiny minority are community owned. When we last discussed these matters in December and then in the parliamentary debate in January, several Members pointed out that throughout the country there are a growing number of community businesses that are hugely successful. The point I made in my statement was that we ought to support them. We want to see if we can do more in that regard. The thrust of my statement was in support of the private sector. I am sure that the hon. Gentleman would agree that £1.7 billion is a significant amount of support.

Mr. Russell Brown (Dumfries and Galloway) (Lab): The Secretary of State has made a serious attempt today to deal with this matter. We have a historical network and we also face a generational issue, in that lower percentages of young people are using post office services. Even if we are to have a new POCA run by the Post Office, can we be sure that sub-postmasters will be satisfied with the transaction amount that they receive, compared with the current situation? Also, when local consultation about a proposed closure takes place, if communities come forward with an alternative—as has happened through the rural postal pilots—will those alternatives be seriously considered by the Post Office?

Mr. Darling: The answer to that question is yes. I am aware that pilot projects have been carried out in my hon. Friend’s constituency, and if people have better ideas for providing services they should be encouraged. The transaction costs and the amount that postmasters receive is a matter for commercial negotiation between the Post Office and the postmasters and postmistresses. I think that that is negotiated from time to time.

Dr. Vincent Cable (Twickenham) (LD): Page 18 of the Government response says that about half of the closures will be in urban areas. How will that be done, as the 1-mile access criterion is the same as that used in the reinvention programme, under which one third of branches have already shut?

Mr. Darling: I am not sure whether the hon. Gentleman was present earlier when I made my statement. I said that the Post Office would come forward from the summer with area plans in which it would set out its proposals. At that stage it will be possible for the hon. Gentleman and other Members to see what is being proposed, and how the criteria have been applied. In the consultation document and the response document, we set out the national criteria and defined what an urban community is. I hope that it will become clear at that later stage that I mentioned how the criteria have been applied. It will then be open to the hon. Gentleman to make whatever representations he thinks are appropriate.

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Mr. Brian Jenkins (Tamworth) (Lab): My right hon. Friend said that we would give Post Office Ltd the ability to shape the network. However, he will remember that last time we were in this situation, which was to do with urban renewal, the plan involved writing to every sub-postmaster, which in the town of Tamworth resulted in all six in the south taking the option to quit and the six in the north staying put. After many months of there being no plan and no consultation—no ability for the Post Office to shape things—it was only by means of an intervention from the chairman, Allan Leighton, that I managed to break the deadlock and get a good service provided for the south of Tamworth, through a Co-op superstore. Does the Secretary of State intend to improve the Post Office’s ability to co-operate and consult, or does he intend to have the chairperson—whether Allan Leighton or not—permanently on stand-by?

Mr. Darling: Lessons do need to be learned from the previous programme. It is important to ensure that consultations are carried out properly and that we get the best possible result, so that we have a post office network that is coherent and can maximise business.

Danny Alexander (Inverness, Nairn, Badenoch and Strathspey) (LD): I welcome the improvements to the access criteria for the most remote communities, but the statement will still cause profound uncertainty in the many communities across the north of Scotland that are not covered by that definition, especially if the POCA contract is not won by the Post Office. Can the Secretary of State confirm whether the new criteria concerning access to public transport mean that any community that does not have a regular, frequent, accessible public transport service will not have its post office closed?

Mr. Darling: I am glad that the hon. Gentleman welcomes the improved and strengthened criteria in relation to rural areas. The Highlands and Islands of Scotland will benefit from the proposals. In relation to the individual plans when they come forward, the Post Office has to take into account a variety of factors and most people would expect it to exercise a degree of common sense when coming up with proposals.

Lynne Jones (Birmingham, Selly Oak) (Lab): Several post offices have already closed in my constituency, leading to increases in queues with consequential reductions in business, because busy people are put off from using those that remain open. One of the closures was voluntary—in Wychall road, which is in a very deprived area. Do the measures proposed today mean that the Post Office will now have to look proactively at replacing that post office, which it previously refused to do? Will the Secretary of State also ensure that the definition of a deprived area does not exclude estates within an otherwise more affluent area?

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