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We have now been told that we are to lose 69 post offices. If one is saved, another will be closed. The access criteria take no account of the conditions of the three miles to be travelled, such as the availability of public transport, road conditions or even, in the fens and broads, the existence of water. No account has been taken of housing development either taking place or planned, with the result that post offices are to close precisely in the towns and villages scheduled to grow. Indeed, so random has been the process that no one will be surprised to hear that post offices are to be retained in the communities which the Environment Agency plans to abandon to the sea. Not a moment’s thought has been given to how poor, elderly and disadvantaged people with no transport can possibly access a post office three miles away.

It is obvious that change in the network is necessary; any Government, as I said, would have to deal with this problem. But I imagine that the Government will have noted that in the post office debate in another place, not one speaker supported the closure programme. They will also have noticed that half the Cabinet is campaigning against these closures. Practical measures such as the involvement of local authorities—and I imagine that my noble friend Lord Hanningfield will talk about the measures planned for Essex—the introduction of new business, the use of post offices as hubs for community activities, in short a vision for the

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future of this much loved and valued service, is what is required from the Government. I hope that we shall hear from the noble Baroness today that such vision is in the Government’s mind.

12.23 pm

Lord Whitty: My Lords, I immediately declare an interest as the chair of the new National Consumer Council, which in a few months’ time will be merging with Postwatch and take on the onerous statutory responsibilities of dealing with the public consultation in relation to post office closures. There are several other issues we could debate about the Post Office—the noble Lord, Lord Dearing, touched on some of them—such as the Post Office card, the future of the universal service obligation and many other activities associated with collections and deliveries, but most public concern at the moment is about the closures on the network. My central contention is that we can blame all sorts of things—social change; technological speed-up; inept management of the Post Office at various stages in its career, and I would do that; the wooden regulatory framework, and Postcomm’s role in that needs some querying; and, lastly, we can blame the people because they do not use the Post Office that much. However, I say gently to the Minister that the central failure here is a failure of imagination and of joined-up government.

The noble Baroness, Lady Byford, will recall debates on rural business when I was sitting on the Front Bench. At a time when we were lamenting, post the foot and mouth epidemic, that we did not have support for rural business as a whole and that the kind of measures that the Government were allowed to bring forward were relatively limited for rural business as a whole, a large sum of money was still going to rural post offices. It would have been better if we had been able to use that money—£400 million over three years at one point—to stimulate rural business as a whole, to maintain rural services in one place in each village and to ensure the kind of holistic approach to which the noble Lord, Lord Roberts, referred, rather than to aggravate the problem by putting all the money into the current structure of post offices without improving their efficiency or allowing them to diversify, and indeed by taking government services away from them.

Much has been said about rural areas. The National Consumer Council carried out a survey of the effects of the most recent rounds of post office closures from 2002 to 2006. It was clear that, contrary to the conclusions drawn by Postcomm, the worst-hit areas were the low-income areas of central London, the outer suburbs of many English provincial towns, particularly those dominated by social housing, and the more disadvantaged villages and towns in rural areas which underwent a loss of transport and access to public and private services. It was not so much urban versus rural; it affected disadvantaged people who were most likely to need post office services. These people should at least have somewhere to go where they can engage with government services generally. It could be where they buy their petrol, or in the pub, or, as the right reverend prelate said, in the churches, any of which could at the same time provide the kind of services that post offices used to provide.

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Somewhere in those communities we need a focus for all the services that our outer suburbs and many of our rural areas have lost so tragically over the past couple of decades.

The present round is about 2,500 post offices. The number has already been decided. Postwatch is diligently and in great detail going through the proposals area by area and carrying out the kind of community engagement that one could argue the Post Office itself should have done at an earlier stage. But however effective those representations, 2,500 post offices will be closed. It is only a question of which post office will close. That is an unnecessarily narrow choice.

The whole range of government needs to be engaged in this. The only bit of joined-up government on post offices that I remember—if I can blow my own trumpet—is when I was roads Minister and I and Ian McCartney, then the Post Office Minister, decided that we were not going to take the DVLA contract away from the Post Office. Dare I say gently to the Minister that we resisted Treasury pressure that time round? Five years later, however, the Treasury got its way and the Post Office lost that contract.

This is not joined-up government. I am rather on the same page as the noble Lord, Lord Roberts, here. We need to take a holistic approach especially to our more deprived rural and urban areas and see what kind of services and government support they need. We should look at it not simply through the tunnel of Post Office finances and subsidy but in terms of what the community itself really needs. It is possible to do that. Services in large villages in France and Germany are provided through the mairie, the pharmacy or the post office. There is a place in such towns, and sometimes in their outer suburbs as well, that fills the role that the post office has historically filled in many of our communities.

We need to move this issue away from a focus on Post Office finances and operational management and away from the kind of constrained choices that this round of closures is focused on. We should look for a more detailed and local solution based on the services that people need. I have no doubt that the noble Lord, Lord Hanningfield, will shortly be giving us a few good examples of that. It is important that local authorities as well as central government play a major role in this issue. Central government need to raise their sights and consider what the people in the communities which have lost or are about to lose their post offices really need. They should not see the issue from such a narrow perspective.

12.29 pm

Lord Soulsby of Swaffham Prior: My Lords, I join other noble Lords in thanking my noble friend Lady Byford for this debate. The number of speakers who have put their names down is surely an indication of the interest in, and concern about, this issue. I think that we would all agree that the village post office provides much more than just a place to buy stamps and to post letters. The Countryside Alliance has rightly stated:

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They provide a vital focus of social and economic benefits to isolated communities across the whole country. When a village post office is closed down, it is the elderly and those who are unable to move around freely who are affected. They may not have access to a car; their bus services may be minimal; and taxi services often represent a substantial financial outlay for what might be a very minor transaction.

Let me give your Lordships an example. When mail with deficient postage is sent, a little note is delivered saying, “This can be retrieved at the local post office by payment of the excess mail charge plus a fee of £1”. It may take a whole day for an elderly person to get to the local post office where that package or letter awaits them. In my village, the post office closed down three years ago, leaving nowhere to purchase minor items, quite apart from post office things such as stamps, mail and so on. Everyday necessities such as greetings cards are no longer available in the village. The only retail outlet is the pub, which does a roaring business but does not help with the mail situation. It has been mentioned in this debate that public houses may well serve as sub-post offices. That is an excellent idea, because they can enjoy a roaring trade; they are open every day for the majority of the day.

The nearest post office to me is two miles away. Although I can drive a car, other people do not have such a facility. The role played by post offices in rural communities has been highlighted by the Business and Enterprise Committee, which concluded that,

It said:

Mention has been made of the Post Office card account, the POCA, which, as noble Lords have said, is a bank account offered by the Post Office. It is designated for benefits, pensions and tax credits with direct payment into the account. Some 4.2 million customers regularly use those accounts. The decision of the Department for Work and Pensions not to renew the POCA beyond 2010 is short-sighted and will have a further negative effect on the Post Office. The Post Office card account has provided many people in rural areas, and indeed in urban communities, with access to their benefits. The village post office supplants the branch of a national bank. The national banks, too, are removing their premises from local village communities, so that elderly people have nowhere to go to deposit their funds or to use the facilities that the Post Office card account provides.

Much of the thinking about the future of village post offices is based on financial considerations, but there seems to be little consideration of the rural services that are the glue holding local rural communities together. One is reminded of the phrase, “knowing the cost of everything but the value of nothing”. Noble Lords will be aware of the independent review panel of the post services to be chaired by Richard Hooper, which was announced by John Hutton last December. It is understood that the panel has consulted widely. Discussion on this evidence will take place at the

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meeting in May this year. That is too late for the debate that we are having today, but we hope that many of the issues that have been raised will be addressed both sympathetically and accurately.

12.35 pm

The Lord Bishop of Chelmsford: My Lords, many communities across our country will be grateful to the noble Baroness for giving us an opportunity to give a public airing to an issue that is of concern to a lot of people in many communities across Britain. The House has already been made aware of the excellent proposals being pursued in Essex through the county council; I, too, am looking forward to the contribution of the noble Lord, Lord Hanningfield, on all this. I understand that in our county we have already lost more than 30 post offices, a number of which the county council want to engage in business relationships. They are now shut and awaiting the outcome of those negotiations. I simply ask: what needs to be done to get a sense of urgency into the process of consultation so that we might get on with it and find out whether this is a model that can be made to work, not only in Essex but elsewhere? I understand that lots of local authorities are interested in this model.

In Little Hallingbury in Essex, for example, the post office is closed. The closure was delayed because of the county council negotiations. The community is waiting and in the mean time people have to go to Bishop’s Stortford and Hatfield Heath for services, neither of which places have excellent parking or ease of access for people. These things need sorting out.

We are seeing, at a time when the Post Office is under both financial and organisational challenge, the weakest and most vulnerable services in some of our smallest and often very vulnerable communities being cut. The outcome of our collective failure, whoever is responsible, to ensure that the Post Office is on the front line of contemporary communications systems and development is that the weakest go to the wall.

I am bound to ask two questions, following up the question asked by the noble Lord, Lord Dearing, earlier. Is there a duty any more to offer good postal services across the whole community? If there is such a duty, how is it imagined that in the contemporary world it will be fulfilled, or are we now the victims of market forces? The Church of England, as the established church in this land, has a duty to ensure that ministry is provided in every community. I cannot look at Essex and east London and move the church to where I think the business is best. We all have to face change and we have to manage it in a way that holds on to our fundamental duty and responsibility—that is, to maintain a level of service across the whole community. I say to the noble Lord, Lord Roberts, that I am afraid that in my county the Church of England is the only institution left in vast numbers of communities. It is, I hope, open and welcoming to Christians of all traditions and to the whole community. My first question is: where is this universal obligation and how are we going to meet it today?

My second question is: what is being done to bring the Post Office into the 21st century so that it is able, imaginatively and flexibly, to ensure that all have good

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and easy access to necessary services? The noble Lord, Lord Dearing, mentioned what is going on in France and Germany. I gather that in the United States of America the equivalent service is right out in front regarding modern communication systems, offering important contemporary services to corporate enterprises and developing new ways of developing services on the basis of its history and skill. That provides the basis for improving contributions in small communities. If the development of modern communication systems means the destruction of the small and the local, something has gone badly wrong and we need to resist it. Modern communication systems do not require us to centralise and pull everything out of the small; they provide exactly the context in which imaginative new services can be provided. It is time collectively and with joined-up government for us to put our minds to establishing how that is to happen.

We all know that we have to face change but we ought not to endure the gradual deterioration of vital public services. Parliament has a responsibility to be resistant to that process. At present, we are facing change through retreat. That is bad news for thousands of small rural communities and, as has been said, urban communities across our country. I hope that today we might hear from the Government of steps being taken to pursue a more creative, comprehensive and joined-up set of policies that will ensure the delivery of necessary services to our people in the 21st century.

12.41 pm

Lord Williams of Elvel: My Lords, I join other noble Lords in congratulating the noble Baroness, Lady Byford, on introducing and initiating this debate. There is no doubt that the programme of closures of sub-post offices in rural areas and small towns is causing great distress. The right reverend Prelate the Bishop of Newcastle rightly said that we are not here as a post office preservation society; I am not in favour of simply providing taxpayers’ or council tax payers’ money arbitrarily to protect post offices that are not profitable. At the same time, I join the right reverend Prelate the Bishop of Chelmsford in insisting that we are entitled as shareholders in the Royal Mail to ask it to behave like a proper, responsible public authority. That it is not doing so is the crux of the problem.

I say in response to a comment of my noble friend Lord O’Neill that I believe that there is a difference between village post offices and urban post offices. The noble Lord, Lord Roberts, brought in Llandudno; I shall bring in Llandrindod Wells, because when I am at my Welsh home I happen to visit a sub-post office daily that has been marked for closure.

The Tremont Road post office will serve as a paradigm for many small urban area—not village—post offices. It is in the north ward of Llandrindod, which is the third most deprived ward in the county of Powys. There is almost no public transport worth the name. The town will expand to the north of the post office. There are plans for a new, multiservice centre with ambulance bay, fire service, police, a new court and possibly the Probation Service. Around 25 per cent of residents do not have a car; 34 per cent of property is

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rented; 13 per cent of residents are lone parents; and 20 per cent are long-term ill. This is a seriously deprived ward and this service is going to be lost.

The consultation took place. I cannot say that it was a true consultation for the simple reason that the figures that the Post Office should have brought out to justify closure were simply not available; we were told that they were commercially confidential. That does not seem to be the action of a responsible body. The Post Office should have said to the sub-postmistress and master, Mr and Mrs Hodges—Mr Hodges is a town councillor who is standing for election to the county council in the Conservative cause—“Let us sit down together and see whether we can make this post office profitable”. There may be many ways of doing that. It is linked to a shop that has been there for 100 years, in the same family. Mrs Hodges works a 60-hour week for something less than the minimum wage. Many people would be prepared to buy or lease the equipment, which is Post Office owned. Plenty of solutions might have been put on the table, but none was mooted by the Post Office, which simply said: “You are going to be closed”. First, you get a telephone call saying that you are going to be closed; then you get a letter. That is not a serious way to conduct business.

Will my noble friend the Minister instruct the Post Office to look again at this type of post office—the urban area post office—which has the potential to be profitable if the local authority were allowed to intervene and the Post Office were to introduce new services? All sorts of things might make that post office profitable. If at the end of the day it turns out that it cannot be made profitable, at least we would all know that the best efforts had been made to see whether we could keep it going. I ask my noble friend to ensure that, in this instance at least, the Post Office will play it fair.

12.46 pm

Lord Cameron of Dillington: My Lords, I, too, thank the noble Baroness, Lady Byford, for introducing this debate, because post offices are an essential part of many rural communities. They are a trusted source of a whole range of services, such as cash and banking for those who are financially excluded or those who still depend on a post office for their child benefit or pension payments. They also produce a significant economic boost to their community. A shop attached to a post office can expect a 25 per cent higher turnover than one without. A shop near a post office can expect a 15 per cent higher turnover thanks to the footfall created by the post office.

Post offices do more than that. As has been said, they often represent the only focal point in day-to-day intercourse within a community. The church and the village hall are slightly narrower in their approach. They provide discos for the young and perhaps whist drives for the elderly. But it is only in the local post office and shop that old Mrs Smith can meet and chat to young Master Jones in an unstructured but secure setting.

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That is the USP of our rural post offices and the reason why I in my capacity as chairman of the late-lamented Countryside Agency worked with others on trying to persuade the Government to keep rural post offices open. The Government provided £150 million a year—an amount that amazed me, although I did not say so at the time. However, it could only ever be a stopgap. Even with the most favourable costing of the value of their social benefits, many rural post offices still present a negative balance sheet, so, for them, closure at some point is inevitable.

However, the potential to promote a valuable role for post offices through the delivery of financial services still exists. There are still more post offices in the countryside than all the banks put together. Using rural post offices for financial services has proven very effective in both New Zealand and Germany in keeping the rural network open. However, as we heard from the noble Baroness, Lady Byford, the Government have made—and still are making—a real Horlicks of introducing the card account. It is all very Terminal 5-ish. The Government seemed determined that this idea should fail and not present any real competition to the other banks, which I suspect was the deal that was done. Why is the DWP still determined to shut down the card account? It could still be worth as much as £1 billion per annum to Post Office Ltd and represents a good chunk of rural sub-postmasters’ income. Why not build on it, improve it and, above all, promote it, rather than cause more closures come 2010?

Meanwhile, I must praise Post Office Ltd for its imaginative use of its window of opportunity. It has experimented with core and outreach schemes and with mobile post offices; it has combined with others such as the police and Business Link to share facilities; it has worked out of hotels, pubs, churches, libraries, tearooms and even an optician’s, and long may that continue. Many of these schemes are being included in the outreach alternatives being offered to some communities under the current consultation. I make a brief plea on that consultation: where the post office is part of the last shop or retail outlet in a village, I ask that it receives special consideration, because the departure of the post office would undoubtedly kill that last shop.

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