Examination of Witnesses (Questions 1-19)
NATIONAL FEDERATION
OF SUB-POSTMASTERS
29 JANUARY 2008
Q1 Chairman: Thank you very much indeed
for coming in for this first evidence session of our inquiry into
the closure programme for post offices. It is quite a busy timetable
that we have set ourselves and we meet again next week to hear
from the Post Office and the Minister and we hope to produce any
recommendations which might or might not flow very quickly thereafter,
if we can manage it. We have had an enormous volume of evidence
from interested parties, including yourselves, and I would like
to thank you for your written evidence, and I am sure we will
enjoy your oral evidence too, but it was extremely comprehensive,
very thorough and very well argued, and we are grateful for that.
We have also had a huge response from colleagues, Members of the
House of Commons with experience of the closure programme, and
we will seek to reflect that particularly in our evidence next
week and ask the Post Office and the Minister about the issues,
so it has been a very, very intense volume of evidence we have
received and we are grateful for it. What I would like to do is
to begin by asking you, as I always do, to introduce yourselves
and then perhaps to go on and, in the words of Morecambe and Wise,
ask the question, "What do you think of the show so far?",
how the consultation process is going overall before we start
digging down into the details.
Mr Thomson: I am
George Thomson, the General Secretary of the National Federation
of Sub-Postmasters, and beside me is Sally Reeves who is the Chairman
of the Negotiating Committee of the National Federation of Sub-Postmasters.
I believe that the Network Change Programme is going relatively
smoothly, given that this is the second closure programme within
five years, given that within this programme 18% of the UK Post
Office network is proposed to be closed and that the Post Office,
in my opinion, have handled a very difficult subject relatively
well. The difference this time round, and people have to remember
this, the last time round the closures were on a voluntary basis,
that sub-postmasters volunteered to go and, as a result, holes
did appear in some parts of the network, whereas this time round
the conversations and the visits are a little bit harder because
some people are being forced to leave, let us be absolutely honest
here, who do not want to leave, but I would just give you the
thought that, for every one phone call that we have at our headquarters
from a member who is upset that they are being compulsorily closed
against their wishes, there are another four or five, this is
absolutely true, who, once the area plan has been finalised, realise
that they are not being closed and are upset that they are remaining
in a network with such a difficult past and quite a difficult
future over the next two or three years. On the whole, yes, there
have been some difficulties, but things are being done relatively
well and I am quite relaxed about where we are at this stage,
given the difficulty of the programme.
Q2 Chairman: And given your regret
that you are in this situation at all?
Mr Thomson: Yes.
Q3 Mr Weir: There has been a lot
of talk about the length of the consultation process, particularly
the public aspect of it. In their rejection of 12-week local consultation,
the Government said that they were "mindful" of your
own call for "speedy local consultation to minimise uncertainty
for sub-postmasters and customers", and that seems to have
become the reason given by DBERR for the six-week period. Would
you have supported allowing the local consultation to last for
12 weeks to allow for better local consultation?
Ms Reeves: I think the element
of the six weeks is quite right for the rationale that was there
of sub-postmasters' interests, consumers' interests and of the
communities that sub-postmasters serve, but also in the wider
interest of Post Office Limited. If we get all of the work right
before public consultation, it is important for sub-postmasters
and the communities that they know what is going to happen to
their business because at the moment everything is in limbo both
for sub-postmasters and their businesses and for Post Office Limited
because nobody within the post office network, until they know
what is going to happen to their business, can invest in their
business. They are very wary about the purchasing of stock because
they do not know whether they are going to be here next year to
sell through and that will have an impact on the communities.
Also, for Post Office Limited, I think they need some stability
in the network to know what is going to happen to the network,
to be able to go out and get business for sub-postmasters and
to approach the clients, so I think the six weeks is long enough
for the consultation period. There has been quite a lot of publicity
before it actually gets to the public consultation area and in
the run-up to that six weeks, most of the people in the consultation
areas do seem to be ready to add their voice to public consultation,
and Post Office Limited themselves seem to have got an awful lot
of emails and correspondence during the public consultation period
which seems to indicate that people are aware of what is happening.
Mr Weir: First of all, if it had been
lengthened to 12 weeks, it would have only lengthened
the process by a period of six weeks. Is it
that crucial?
Q4 Chairman: But the process has
effectively been going on for how many years now? Effectively,
the uncertainty has been for two or three years?
Ms Reeves: Yes, it has been a
long process and the actual process from the beginning to now
has produced a lot of negativity within the post office industry
for sub-postmasters and I believe that that needs to be addressed
very quickly and very cleanly to be able to move forward in a
more positive light, and I believe that any lengthening of the
time is just time too much for people's investments.
Q5 Mr Weir: The problem for the public,
and I realise what you are saying, but they do not know the specifics
of which of their post offices are marked for closure until the
area plan is actually published, so when you talk about a much
longer process, from the public's point of view it is six weeks
from day one, "Your post office is going to be closed"
to then come up with a campaign or whatever, to consider the implications
of the proposals and mount a campaign. Local authorities have
the same problem when they are working in generally a four-week
timescale, and there have been some concerns, for example, by
local authorities that they are not given prior notice of what
is happening.
Mr Thomson: I think what also
has to be remembered is that this is the second closure programme
and also that the Government's consultation on the future of the
network went out on 14 December 2006 and that consultation, which
finally evolved into the report on 17 May on the future, started
from the premise that the Government were putting in a £150-million-a-year
network support payment and that they wanted the network to fit
within that. We have also got to remind ourselves that these 2,500
closures is the Government trying, working with the Post Office,
to get a network that is both sustainable and affordable within
the £150 million, so there was the initial consultation on
the principle that we needed a small post office network.
Q6 Mr Weir: But there is a massive
difference between the principle of a closure programme and the
effect on individuals, communities and post offices. On one specific,
and this talk of six weeks or 12 is interesting, but, for example,
it transpired in Glasgow that where a post office was going to
be closed, a public campaign was mounted and that post office
was reprieved from closure, then another post office which was
previously told it would not be closed was simply substituted
in its place. Now, that seems a bizarre way of dealing with the
programme and it does appear that it has become merely a numbers
game for closing a set amount of post offices in each area. Is
that your experience of it?
Mr Thomson: My view, and I have
got sympathy with the last point you said there and I have made
the Post Office aware of that point, but I do think that there
is genuine consultation, but that is undermined by a simple substitution
when you reprieve, in brackets, one office to then substitute
it with another. I think it lends credence to the people saying
that the consultation is not genuine. I believe it is genuine,
but I think that the one-for-one policy is wrong and I do not
believe in it and I certainly think that the Post Office should
stop doing that. If an office is reprieved, I do believe that
we should not automatically substitute another one.
Q7 Mr Hoyle: The suggestion of £150
million, people view this as just another layer. Instead of being
the death by 1,000 cuts, this is actually the death of the post
office network by five cuts because it will be the £150 million
and then three years down the line it will suddenly drop to £100
million and then £50 million and we are just actually going
to end up taking more out. Is that true or not?
Mr Thomson: A very good point.
The Federation this time round have supported this closure programme
reluctantly, but what I will say in a public forum is that the
answer to the problems facing the Post Office cannot continue
to mean every two or three years closing 2,500 offices. Five thousand
offices will be closed within four years and that takes us to
what I would call the `critical mass' The network that we will
have left of about 11,500 offices, whatever happens, the solution
to future problems has to be working with the Government, Labour,
Conservative, Liberal, it does not matter who, but working with
the Government to say, "How can we make the 11,500 offices
that are left sustainable? How can we help bring work in?"
We think that one of the ways we can do that is for a post-bank
to be created, and we have to win the Post Office card account
tender too, but what I do know is that I will not come along as
General Secretary and support another closure programme. We have
to make sure that those left have got a future. If you think about
it logically, the UK has a population of 60.5 million, we have
the second-biggest population in Europe after Germany, we have
the second-biggest economy in Europe after Germany. Now, surely
we must have the ability and the brains to support a network of
post offices of 11,500 for a population of 60 million, so we have
worked with the Government up to now, but we now have to sharpen
up the game. We have to say, "How do we make sure that the
Post Office, after this closure programme, has a future",
and I would say on this point that that has not had enough work
done on it in the past by any government.
Chairman: I think we have a lot of sympathy
with that point and this Committee's earlier reports have pointed
in that direction.
Q8 Mr Weir: On the substitution point,
can you enlighten us as to what happens then when a new post office
is then targeted for closure? Is there a further consultation
period on that and how does it affect the overall consultation
period?
Mr Thomson: There is a further
six-week consultation period when one office is reprieved and
a substitution is put in its place.
Q9 Mr Weir: Do you think that is
long enough, given that the customers and postmasters will have
been told, "You are safe, you're not being closed",
but somehow they change their minds and decide, "You are
being substituted"? Do you think that six weeks is long enough
for that to be dealt with?
Mr Thomson: What I do know from
looking at the figures, and the vast majority of people who want
to reprieve an office take it to their councillor, they will take
it to their Member of the Scottish Parliament, they will do the
same in Wales and the same in Northern Ireland, or they will take
it to their MP, so I think really that, if the councillor or MP
is on the ball and they are really organised in trying to save
an office, six weeks is fine, and I really do think that. Making
it longer than six weeks does add to the uncertainty. The Federation
are absolutely comfortable with people having six weeks to start
a campaign or put their arguments against the closure of a particular
office.
Q10 Mr Weir: On the point about the
programme, we have been told that the Post Office only visited
those post offices suggested for closure, not the nearby `receiving'
ones. Is that the case?
Ms Reeves: No, it is my understanding
that anybody who is going to be a receiving office is approached
by Post Office Limited as part of the overall resolution of the
access criteria within that area and, if an office is closing,
wherever that work is likely to migrate to is visited as being
a receiving office, and that has been my experience.
Q11 Mr Weir: Are you satisfied that
sufficient local knowledge has gone into drawing up the local
plans to ensure, for example, that where a post office is being
closed, the receiving branches are large enough to take the additional
work? I have to say, in my own constituency the experience of
past closures is that it has led to difficulties in some of the
receiving branches because of an unplanned closure. We have not
got our area plan yet, but I am a bit concerned that you end up
with a situation where the receiving branches are being swamped.
Is that a worry and an experience that you have had?
Ms Reeves: At the moment, it is
not a worry or an experience. I think there are some concerns
perhaps, and there have been some concerns in the past, for offices
closing in town centres around crown offices, branch offices,
directly managed offices. I think that has been an area of concern,
particularly for Postwatch up until now, but out in the wider
community it seems as though most of the offices seem to have
capacity or else there are arrangements being made to increase
their capacity to be able to take on any of the business from
a closing office, so it does seem to be working well and there
are funds around to increase capacity in some offices. I think
locally there may be not as much information given to Post Office
Limited in the early part about local arrangements for transportation,
local council plans and things like that in the early stages,
and I do know from working with local councils locally to my area
which are coming up towards the consultation process, they are
getting far more information through to Post Office Limited before
they start to make any decisions about an area so that Post Office
Limited are properly informed about future plans locally within
the council areas.
Q12 Chairman: I am not really inviting
comments at length, but I think it is important to get it on the
record in the oral session that paragraph 3.12 of your written
evidence talks about the grants that have been made available
to help receiving offices cope with the extra work, but you do
say that you believe that the investment is "massively insufficient
in providing the investment the network as a whole needs in order
to achieve the Government's desired `necessary changes to transform
the network'". That is in your written evidence, but I think
it is important that people hear that in public as well.
Ms Reeves: I think there are two
issues there. One is the issue about the grants that are available
to be able to take capacity in, but I think the other issue is
about any grants that are available to improve the network as
a whole to make it fit for purpose for the different types of
products and different services that will be delivered in the
future.
Q13 Roger Berry: If I could raise
the issue of proportionality, in Postwatch's submission to the
Committee, they say that it is of course right to avoid disproportionately
high numbers of closures being proposed in any particular area
in line with what the Government has said, and they then go on
to say that this "could exacerbate existing levels of disadvantage".
I must confess, I am left not knowing where Postwatch is on this
issue, but do you think, as a representative organisation, that
there is any alternative to the proportionality principle?
Mr Thomson: I think the principle
is fair and equitable. On average, 18% of all post offices in
an area plan are being proposed for closure and, in all honesty,
I do not think it could be done any other way. It has taken a
direct percentage of what already exists on the ground and it
is averaging 18% per area plan. I think to try to do it any other
way would have caused far more problems than by taking a proportional
approach throughout the UK, accepting that, regrettably, with
the 14,200 offices that are in the network at this moment in time,
there are too many post offices for the work that is within the
network and I am absolutely comfortable with 18% on average in
an area plan.
Q14 Chairman: On a point of fact,
there are nearer 14% at present in the outcomes, I believe.
Mr Thomson: Yes, but there are
18% proposed and again there are about 31 offices which have been
pooled as well.
Q15 Roger Berry: I can see from a
business point of view that proportionality might actually make
quite a lot of sense, although, recognising that some areas of
the country are far better endowed with post offices than others,
there does seem to be a sort of issue of fairness here which might
mean that, if you have an already disadvantaged part of the country
in terms of the availability of post offices, proportionality
might actually make those areas even more disadvantaged.
Mr Thomson: Well, there are large
parts of the Highlands and Islands, and 37 of the 38 excluded
postcodes because they do not meet the minimum criteria are in
Scotland and there is a situation where the Post Office are actually
having to improve, and increase, the provision to make sure that
these areas do have a better service than they have had historically
in recent years.
Q16 Roger Berry: Do you think Postwatch
is doing a decent job?
Mr Thomson: I think Postwatch
are doing a very good job and they are doing most of that good
work at pre-consultation. I do get a little bit frustrated when
I hear from MPs obviously that the consultation is a sham. In
Glasgow, for example, the first area plan, 24% of the offices
that were proposed for closure in private before it started, so
pre-consultation, Postwatch persuaded the Post Office to change
24% of them, so before it even went to public consultation. The
beauty about doing that before it was at public consultation is
that, if an office is changed behind the scenes by Postwatch and
Post Office Limited, it means that it never went out to the public
and that office was not blighted. What happens is that once it
goes out to public consultation, a decision is reversed and a
post office stays open, that sub-postmaster has already had posters
up for a few months saying that he is closing down and directing
people to another post office. When an office is reprieved, and
there are at least 31 already, when it has been through public
consultation, it means that that office, although it has been
saved for the community, and that is good for the community, that
sub-postmaster finds himself in a very, very difficult situation.
At pre-consultation, Postwatch are having a major input and not
just bringing in the criteria, but they are talking about, if
you like, topography, they are talking about roads, they are talking
about social and financial inclusion and they are talking about
the amount of pensioners in a particular area, so Postwatch are
having a major input in making sure that POL are doing their job
properly.
Q17 Mr Weir: I am just interested
in that because what you are saying basically is that a lot of
decisions are made before the public consultation, but do you
not see that as part of the problem, that the public are seeing
a plan being presented to them where the decisions have already
effectively been made and there is very little chance to change
it within the short period of six weeks they are given, and that
is the feeling that the public feel, many people feel, that it
is a failure in the consultation process?
Mr Thomson: I understand what
you are saying, but, given that something like 31 have been reprieved
already and my calculation is probably well in excess of 100 after
the programme finished on 30 November, that would suggest that
not only are there changes at pre-consultation with Postwatch
in particular, but Postwatch are listening, POL are listening
and the Government, to some extent, are listening and that changes
are being made at area plan level after public consultation. I
think the numbers are stacking up that would suggest that that
indeed is the case, so much so that myself and Alan Cook in recent
weeks have had to actually sit down and look at what we could
put in place which would be a programme that would help these
offices that are being reprieved which, because they have lost
much of their customer base because they thought they were closing,
how can we make sure that they have a future and how can we try
and protect the salary level, for example, how can we try and
give them publicity to tell the public they are still open, do
we look at products, do we enhance the products that they have
now to try and win back the customers. We realise that there is
a problem and that problem is that we are going to have something
like 100 offices which will have been reprieved which will have
lost a lot of their customer base, and it is how we actually rebuild
that customer base.
Q18 Mr Weir: There is another side
to the problem as well which is of those that are substituted
for the reprieved post offices where they have been saying, "Everything's
okay, chaps" and suddenly it is not, but they are closing
and they have six weeks to mount a campaign. It just seems a bizarre
way of going about it.
Mr Thomson: I was in Derby last
week giving a presentation and that was an example of what you
said there. This was a sub-postmaster who thought he was safe
and never realised he was being closed and he was very upset.
I have indicated to the Post Office particularly in the last two
or three weeks that I feel that replacing a reprieved office by
another office does not do justice to the consultation process,
and I think it is a genuine consultation process and I believe
that, when a reprieved office is saved and another one it is put
in its place, that brings it not only into disrepute, but it certainly
makes the consultation process a little bit more questionable.
Mr Weir: I do not understand how, if
a post office after the consultation process is not to be closed,
and it is presumably under the criteria of the process, it is
deemed to be either needed or viable or whatever, why then does
another one then suddenly become not viable, needed or whatever
and is substituted for closure? It seems to me like a straight
numbers programme where in saving one, another has to go. It is
bad enough in urban areas, but in rural areas we can have a village
fighting another village if they are relatively close together.
Q19 Roger Berry: Your answer to my
question about Postwatch was that the evidence they were doing
a good job was that in pre-consultation they—
Mr Thomson: Changed.
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