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Lord Richard: My Lords, if I may say so, the Minister is being at his most peevish this afternoon in relation to the drafting of my noble friend's Question. Will the noble Lord confirm that the Clerk of the Parliaments has informed the Government that the reason that there were different drafts of the Question was that, unfortunately, the Clerks got it wrong when it was first tabled and it was thereafter put right?

Noble Lords: Oh!

Lord Henley: My Lords, I can neither confirm nor deny that.

Lord Richard: Ask your Chief Whip!

Noble Lords: Order!

Lord Henley: My Lords, I was in no way being peevish; indeed, I believe that I was having a bit of

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innocent fun at the expense of the noble Lord opposite. There is no need for the noble Lord to get on his high horse about it.

Lord Richard: My Lords, with respect, I am on my high horse because a little bit of fun is absolutely splendid if the facts upon which it is based are absolutely right. Will the Minister confirm the facts with his noble friend the Chief Whip who, I am told, knows the position, which is indeed as I have stated?

Lord Eatwell: My Lords, I am most grateful for the good wishes expressed by the noble Lord, Lord Boyd-Carpenter, and echoed by the noble Lord, Lord Henley. However, will the noble Lord confirm another pernicious aspect of Schedule 17, namely, that settlements on non-existent income made prior to the passage of the legislation into law will attract taxation? In other words, taxation will be levied retrospectively on settlements made prior to the Bill being enacted. Is that not an unfortunate principle?

Lord Henley: My Lords, to suggest that it is retrospective is absolute nonsense. No one setting up a trust is entitled to expect that the income tax treatment of that trust will stay the same throughout its existence. Indeed, the noble Lord can ask any of his colleagues who have been Chancellor of the Exchequer, Chief Secretary, or whatever. They will confirm that that has always been the case.

The Post Office: Competitiveness

3.24 p.m.

Lord Ezra asked Her Majesty's Government:

    Whether they have any plans to provide the Post Office with the necessary level of commercial freedom to meet increasing domestic and international competition.

The Minister of State, Department of Trade and Industry (Earl Ferrers): My Lords, commercial freedom and proper constraint over the use of public money are not easily compatible objectives, but we are engaged in widening the opportunities for Post Office Counters and are helping to automate its services.

Lord Ezra: My Lords, I thank the noble Earl for that Answer. Nevertheless, will he agree that the Post Office is now in a somewhat anomalous position of having not only to pay profit tax like everyone else but also to hand over to the Treasury more than what is left in addition? In that situation, how can the Post Office have sufficient funds to invest in order to face up to the competition which everyone agrees it has both domestically and internationally? In that connection, will the Minister indicate what the Government are doing to give further consideration to the points for greater commercial freedom for the Post Office under public ownership as set out on page 15 of the Green Paper which was issued last June?

Earl Ferrers: My Lords, the Post Office has always paid money to the Government. Indeed, the

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Post Office has invested £1.7 billion in real terms over the past five years; it has paid Her Majesty's Government £475 million in the past five years; and it made a profit of £98 million before tax in real terms during the same period. Post Office Counters is taking on extra business. For example, it is taking on aspects like travel insurance; people can now pay their gas bills over the counter; it is selling National Lottery tickets; and, indeed, one can even buy fishing licences. However, I agree with the noble Lord in that it is very difficult to get full commercial competitiveness and full commercial investment if one is constrained by being a public company.

Lord Wyatt of Weeford: My Lords, now that his Government's majority is growing daily more secure, does the noble Earl agree that he should advise the President of the Board of Trade to have another go at a proper privatisation and not continue to muck about with halfway houses which are unsatisfactory in every possible way?

Earl Ferrers: My Lords, the Government's majority is totally secure—

Lord Mellish: In this House.

Earl Ferrers: My right honourable friend the President of the Board of Trade is not "mucking about", as the noble Lord put it so gracefully; indeed, he is quite determined. The preferred option is the one which my right honourable friend has always suggested and which he has gone for. However, if Parliament in its wisdom does not think that that is an appropriate result, we have to do the best that we can in the circumstances in which we find ourselves.

Lord Clinton-Davis: My Lords, does not the Minister perceive that there is something slightly contradictory in the Government's stance? For example, is it not a fact that they have said that it would be unfair to privatise because it would offer advantages to the Post Office over private competitors? But did not that argument occur to them when they wrote off literally billions of pounds when privatising a certain number of other industries? Did they not secure unfair advantages?

Further, as regards the answer that he has just given, does the Minister not realise that encouraging Post Office shops to engage in all those additional trading activities will surely provide some competition with the private sector? Even when it comes to the PFI, does not the Minister see that projects in which the Post Office might be involved would give it the sort of so-called "unfair competition" competitive advantage? Why are the Government immersed in such pure ideology when other governments are enabling their publicly-owned post offices to have precisely those advantages?

Earl Ferrers: My Lords, I observed the noble Lord sitting on the Front Bench thinking like mad and I wondered what curious supplementary question he was going to ask. The noble Lord knows perfectly well that the reason why the Post Office cannot receive the investment that it requires is due to the fact that

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it is still in the public domain. You cannot give to a public company the reward of not being able to go bankrupt but yet all the advantages of competition. That is the reason why we wish to see the Post Office privatised.

Lord Clinton-Davis: My Lords, why was it put forward as an option in the Green Paper then?

Earl Ferrers: My Lords, curiously enough there were three options and the preferred option was not one of those.

Viscount Slim: My Lords, in reference to the Question of the noble Lord, Lord Ezra, on the competitive edge of the Post Office, is it not a fact that the Post Office has decided not to have any commemorative stamps, sets or first editions to commemorate the end of World War II? Surely that would not only be profitable and, with some market vision, useful to the Post Office, but also the nation would expect it. Can the noble Earl explain that to me?

Earl Ferrers: My Lords, if the noble Viscount would like to put down a Question about stamps, I should be delighted to answer it, but I think it is rather far removed from the Question on the Order Paper.

Lord Ezra: My Lords, following on the question put by the noble Lord, Lord Clinton-Davis, is the noble Earl aware that Australia, Canada, Denmark, France, Germany, the Netherlands, Singapore and other Far Eastern countries, while retaining postal services under public ownership, have nevertheless enabled them to borrow money externally, to enter into partnerships and to operate commercially? If all those countries can do it, why cannot we find an answer to the problem?

Earl Ferrers: My Lords, for the simple reason that the Treasury and the Government cannot be expected to give a commercial operation unlimited backing to prevent it from going bankrupt. That is not fair competition for those who have to compete with it without such security.

Consolidation Bills: Joint Committee

3.31 p.m.

The Lord Chancellor (Lord Mackay of Clashfern): My Lords, I beg to move the Motion standing in my name on the Order Paper.

Moved, That, pursuant to Standing Order 49, the following Lords be appointed to join with a Committee of the Commons as the Joint Committee on Consolidation Bills:

Airedale, L,

Alexander of Tunis, E,

Dilhorne, V,

Gisborough, L,

Hanworth, L,

Haskel, L,

Lloyd of Berwick, L,

Mallalieu, B,

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Meston, L,

Steyn, L,

Strabolgi, L,

Wigoder, L.

That the Committee have power to agree with the Committee of the Commons in the appointment of a Chairman; and

That the Minutes of Evidence taken before the Committee from time to time be printed and, if the Committee think fit, be delivered out.—(The Lord Chancellor.)

On Question, Motion agreed to.

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