Post Office Network

Brendan O'Hara Excerpts

Thursday 25th April 2019 Westminster Hall

[Brendan O'Hara (Argyll and Bute) (SNP)]

It is a pleasure to serve under your chairmanship, Dame Cheryl, for this important debate on the sustainability of the post office network. I congratulate my hon. Friend the Member for Motherwell and Wishaw (Marion Fellows) on securing it and on her excellent contribution, which highlighted the ongoing crisis in the Post Office and the pressure faced by those who have to work in extremely difficult circumstances to deliver a service on which so many of our constituents rely.

There have been some excellent contributions, none more so than that of my hon. Friend the Member for North Ayrshire and Arran (Patricia Gibson). The Government should be in no doubt about the strength of feeling about this issue and the support that the post office has from Members of all parties. I share the concerns of my hon. Friend the Member for Motherwell and Wishaw, who said that the post office network is being run down and set up for future privatisation, which would have absolutely catastrophic consequences, particularly for those of us who represent and live in rural communities.

I hope the Government take heed of what is being said here today and start to show the level of commitment required to sustain—and, indeed, grow—the post office network. As we have heard, it is a lifeline service for many people living in rural areas, such as my constituency of Argyll and Bute—a vast area covering more than 7,000 sq km and taking in 26 inhabited island communities.

I have my doubts about whether that will be the case. Last month, when responding to an Adjournment debate secured by my hon. Friend the Member for Paisley and Renfrewshire North (Gavin Newlands), the Minister said that, under this Government, the post office network is

“at its most stable in decades”,

and that

“Government funding required to sustain the network has drastically decreased and is set to decrease even further in future years.”—[Official Report, 27 March 2019; Vol. 657, c. 477.]

That is not the message that my constituents want to hear from the Government. The Government have achieved what they describe as stability, but we in Argyll and Bute have lost 20% of our post offices in the past 13 years. In the past two years, six post offices have closed their doors, yet the Government still say they plan to decrease funding drastically in the coming years. We can have no faith in them.

Our rural communities know how important local post offices are in sustaining already economically fragile parts of the country. I am afraid that, as with so many other areas of their lives, when it comes to protecting the rural post office network, they can have no faith that the UK Government will act in their best interests.

It is not just the ongoing threat of closure that threatens many of our rural post offices, but the additional workload being placed on them as high street banks abandon rural Scotland as fast as their desire to make a quick buck will carry them. In the time remaining to me, I want to look at the effect that bank closures are having on the rural post office network. Small rural post offices, which are often community-run, were not designed, and are simply ill-equipped, to replace long-established banks. I want to use as an example the community post office in the village of Cairndow.

Cairndow sits on the shores of Loch Fyne, and is situated 10 miles from Lochgoilhead and Inveraray. Several years ago, the community identified the need for a post office in the village, and in 2015, thanks to the dedicated hard work of local people and Here We Are, a local third-sector organisation, the people of Cairndow celebrated the opening of their brand new community-run post office. The new venture has been hugely successful, and I pay tribute to the people at Here We Are and the entire community of Cairndow for what they have achieved.

It is not all good news. Because of a seemingly endless programme of bank branch closures in Argyll and Bute—most notably, the Royal Bank of Scotland’s decision last year to close the last bank in the town of Inveraray—what was a small community-run post office designed simply to meet the needs of a small rural population has become a replacement bank.

Although the post office at Cairndow has always been more than happy to provide a banking service to small local businesses that cannot manage the 60-mile round trip to the nearest bank in Dunoon or Lochgilphead, it fears that it is now in danger of becoming swamped. It has become the bank of choice for many large international businesses that operate in the local area. It reports that its levels of cash-handling have gone through the roof in recent months, as has the amount of time staff have to devote to it. So much of its time is now taken up providing banking facilities for people: it feels that its core business—providing a post office service—is suffering as a result. As we have heard, it is not even as if the efforts to provide that extra service are well rewarded. It is being asked to fill the gaps left by high street banks as they desert rural Scotland.

After all, it is that post office, along with other rural post offices, that has to shoulder the burden of all the additional security concerns. It now holds a great deal more money than it ever had before, and it has had to put appropriate measures in place for the increased cash on the premises. Despite all that extra banking work and the extra security concerns that come with it, it receives scant reward for providing that increased level of service. As one leading member of Here We Are at Cairndow said to me just yesterday,

“We didn’t set this up to become a community bank. We set this up as a community post office, and now we feel as if we are subsidising both the bank and the Post Office.”

When the Minister responds, I would appreciate it if she advised those people at Cairndow that something practical will be put in place to ensure that they are able to continue as a community post office, rather than having the burden of being a replacement bank forced on them. Despite the loss of 20% of my constituents’ rural post offices in the last 13 years and the funding cuts that the Minister has announced, will she provide a cast-iron guarantee to them that there will be no more post office closures in Argyll and Bute?

--- Later in debate ---

[Drew Hendry]

I do not intend to go too far off track, but I must respond. It is absolutely typical of the Tories to say that we have to fix every mess and failure at the expense of the Scottish public and services in Scotland. That is a ridiculous proposition.

Returning to the core debate, there was enormous consensus among hon Members. My hon. Friend the Member for North Ayrshire and Arran (Patricia Gibson) pointed out that businesses across communities lose money if post offices close. She said that people are cynical about the politics of the Westminster Government, who make no commitment to post offices and then wring their hands at the consequences. She talked about hand-counting thousands daily, and everything that involves. She talked about the post office being the last place for face-to-face contact in communities. It is more than just a commercial entity, and older and more vulnerable people are the most affected by closures.

It is telling that Later Life Ambitions, a pensioners’ organisation, points out that the post office is important in day-to-day life, because older people, who are often the most vulnerable people in society, rely on post offices. They are a lifeline; they offer access to pensions and benefits, and let people pay bills, get advice and even socialise. Does the Minister acknowledge that this is a social issue, too? For those who do not or cannot communicate digitally, post offices are very important. They are used by 42% of consumers over 65, and 31% of disabled consumers.

The hon. Member for Coatbridge, Chryston and Bellshill (Hugh Gaffney) talked about working with my hon. Friend the Member for Motherwell and Wishaw, and about post offices needing to be run in the interests of people. That is absolutely correct. In talking about franchising policy, he highlighted that WHSmith has been voted worst retailer. It is notable that the jobs it advertises are particularly low-paying.

In a very telling speech that hit home with me as a fellow MP representing a rural community in the highlands and islands, my hon. Friend the Member for Argyll and Bute (Brendan O’Hara) shared concerns that post offices are being run down and prepared for privatisation. He talked about the catastrophic effect that can have on rural communities, particularly in the highlands and islands, where often there are huge distances between the services that people rely on. My hon. Friend talked about the stability policy of the UK Government; Argyll and Bute has lost 20% of its post offices, with six post office closures in the last two years. The drastically reduced funding has put post offices in a very vulnerable place, and the public have no faith in the UK Government protecting rural post office services. He was also right to point out the success of Cairndow, and to congratulate those people on taking matters positively into their own hands to try to do something for their communities.

My hon. Friend the Member for Paisley and Renfrewshire North (Gavin Newlands) talked about the transaction charges, and so he should, because his work should be commended. I congratulate him on forcing action, not only through his Adjournment debate, but through continued pressure and engagement. He talked about the impact of the systemic degradation of services in towns and villages and, importantly, the issue of community designation. It is a good thing to have community designation, but the problem is that rural and semi-rural post offices are losing out, while cities can gain. The criteria are too black and white, especially the three-mile rule.

The hon. Member for Glasgow North East (Mr Sweeney) talked about the unsustainable model imposed on the post office network, and shared his concerns about franchising. When there are bank closures in our communities, we have all been told, “Don’t worry; the post office network will pick up the slack.” He also talked about the toxic conditions for the people who run post offices, many of whom got into the job because they thought it was a great thing to do for their communities, a proper career and a valued position in the community. My goodness, how they have been let down by how they have been treated. He predicted a massive failure over the next five years if there is no action.

[Philip Davies in the Chair]

Post offices are not just business; they are focal points for many communities. This issue is about communities and their health and wellbeing, as well as the national and local economic impact. For many, the shiniest jewel in the crown has been prised out and cut up for the profit of those who do not rely on or even need a post office. In 2017, Citizens Advice found that people valued their community post office more than a local pub, a bank branch or a library. Does the Minister acknowledge that importance? In rural areas, 36% of businesses use post offices at least weekly, and 62% of small businesses use them at least once a month. Over 500,000 businesses are registered in rural areas—that is one in four companies—and they contribute more than £200 billion to the economy. These people are creatives and innovators who use post offices to send goods and pay bills. According to Citizens Advice, eight out of 10 of them will lose money if local post offices are closed. Will the Minister take notice of that?

We in the SNP—and others, as we have heard—are clear that we want our Post Office to remain robust, and to serve our businesses and communities, but that is not a priority under the UK Government’s management. Consequently, the Government should devolve power to us to ensure that the Post Office is protected. Under the current policy, there has been a mass exodus of postmasters, often leaving communities branchless. My hon. Friend the Member for Motherwell and Wishaw should be commended for arguing for fair hourly rates for postmasters, but the Minister must undertake to commission independent analysis and answer the big questions about fairness.

As we have heard, pay levels are leading to a major exodus of postmasters. Rather than watch the Post Office crumble, the UK Government should support postmasters and ensure fair remuneration. As was pointed out, the publicly owned Post Office’s North Star initiative is aiming for a £100 million profit by 2021. That is all very good, but postmasters’ pay has declined by £107 million since 2012. The majority of postmasters now earn less than the minimum wage. In many cases, they cannot even get out; their businesses are now too unattractive to sell.

The National Federation of SubPostmasters has raised the issue of sub-post office closures with the UK Government and the Government-owned Post Office Ltd. The federation’s spokesperson said:

“Our records show around two-thirds of closures are due to the resignation of the sub-postmaster— and a survey of our members conducted earlier this year gives an insight into why sub-postmasters are resigning. Income is dropping over time, the majority earn less than the national minimum wage for running their post office—and therefore earn less per hour than their staff—and as many as a third took no time off last year.

We agree with Marion Fellows that Scotland has been hit hard by sub-post office closures. This is a particular problem for rural areas in Scotland, as well as across the UK, where people rely on their local post office for vital postal and banking services.”

Action on transaction charges is welcome, but why wait? Why not give the same rates to local branches and main post offices? Around 90% of post offices in the highlands and islands are local branches, not main post offices. Will the Minister challenge that with the Post Office? As my hon. Friend the Member for Motherwell and Wishaw pointed out, there must be a vision for the post bank, and it should be properly funded.

There is more pressure on post offices than ever, given the loss of local banks through short-sighted closures by the Royal Bank of Scotland, Halifax Bank of Scotland and others. Now we find that TSB is starting the process of shortening hours, which is always the cynical first move in reducing a branch’s viability to the point where its closure can be justified. As we heard, all those banks say, “It’s okay, you can use the post office,” but we cannot if they have gone.

Even where post offices remain, Robert Cockburn, a constituent of mine who runs the post office in Drumnadrochit, says the workload is absolutely punishing. He often has to run his business as a single-manned operation, so while he goes behind the screen for the time it takes to deal with a transaction, he loses out on custom from people who come to his business and might have bought goods to help sustain him.

[Brendan O'Hara]

While we have been sitting here, I have received an email informing me that yet another bank branch in Argyll and Bute is planning to cut its numbers ahead, I believe, of closure. The TSB branch in Dunoon now says its customers have to travel what it calls 7 miles to their nearest branch, seemingly unaware that that journey involves a ferry and a bus. Yet again, it is death by 1,000 cuts to financial services in rural Scotland. Will my hon. Friend join me in utterly condemning that latest move.

[Drew Hendry]

My hon. Friend is absolutely right, and I join him very robustly in condemning that move. As I said a moment ago, shortening hours is the first step towards making a branch unviable so it can no longer do business. The call then goes out, “Don’t worry, the post office will pick up the slack.” As we know, that is not always the case.

My constituent Mr Cockburn says it is punishing to run his post office. He told me:

“It is a combination of everything. The work that we have is onerous and does not pay enough money to cover your time. The business banking, for example, we get paid 23p per £1,000 that we count. That’s nothing. You think, on minimum wage, how long it takes you to count £1,000. If you make a mistake or”—

more commonly—

“if the customer’s made a mistake you have to double check it. We get paid for taking a parcel over the counter, but the Post Office took 6% away from us on that because they gave us a faster printer and said we could print labels faster. It’s ridiculous.”

A rural post office gets to print a label faster, and the Post Office cuts its money for doing so. That is ridiculous.

The UK Government must ensure that there are more incentives for new and existing postmasters to maintain and open post offices. Union officials rightly have been clear about the folly of closing Crown offices and franchising the service. As we have heard, franchises often advertise jobs at a lower rate than the Post Office pays. As the all-party parliamentary group on post offices found, the Post Office has no back-up plan in the event of WHSmith failing to deliver the service.

I hope the Minister has taken clear cognisance of what has been said during the debate by people representing their constituencies and communities, the vulnerable people who need these services most, and the postmasters who are being forced into subsistence living and locked into a business they simply cannot afford to get out of. This is a matter of having a social conscience and ensuring that communities have something they can rely on, not just now but into the future. If post offices are going to have to pick up the slack of bank closures and other things, they should be allowed to become sustainable in order to do that job.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Kelly Tolhurst)]

It is a pleasure to serve under your chairmanship, Mr Davies. I congratulate the right hon. Member for Orkney and Shetland (Mr Carmichael), and the hon. Members for Motherwell and Wishaw (Marion Fellows) and for Paisley and Renfrewshire North (Gavin Newlands), on securing today’s important debate on the sustainability of the post office network.

As I have said many times before, I am always happy to challenge the Post Office on specific concerns that MPs have at constituency level. I am therefore grateful to hon. Members for their contributions. It is encouraging to see that all sides of the House share common cause in ensuring that a vital national asset continues to serve our constituencies for many years to come. It is because of the key role that post offices play in service to their communities that our 2017 manifesto committed to safeguarding the network.

[Brendan O'Hara]

Will the Minister join the consensus across the House to support the retention of the post office network in public hands?

[Kelly Tolhurst]

If the hon. Gentleman would allow me the courtesy of getting to the content of my speech, that would be really useful. I am still at the start. We made a commitment in our 2017 manifesto and are committed to safeguarding the network. The Post Office is publicly owned and it is a commercial business operating in competitive markets. The Government set the strategic direction for the Post Office to maintain a national network, accessible to all, and to do so in a more sustainable way for the taxpayer. We allow the company the commercial freedom to deliver that strategy as an independent business.

I must point out some of the language and words used in the debate, such as “managed decline” and “undermining the network”, and the idea that it is ideological of the Tories to run down post office branches. As the Minister responsible for post offices, I find that incorrect and inaccurate. I do not regard Government investment of £2 billion over eight years as a so-called managed decline or undermining of the network, and I do not regard the establishment of 450 new locations since 2017 as managed decline or an undermining of the network. As hon. Members have outlined, at the end of March there were 11,547 branches. That number is as stable as it has been in many decades, so I refute those claims.

Draft State Aid (EU Exit) Regulations 2019

Brendan O'Hara Excerpts

Wednesday 10th April 2019 General Committees

[Kelly Tolhurst]

The Government made it clear in the intergovernmental agreements on the European Union (Withdrawal) Act 2018 that state aid would be a reserved matter. The SI before us relates to a UK-wide regime and would transpose retained EU law into UK law. Any further discussions or decisions on future state aid policy that might or might not be introduced will obviously not be for this Committee. As I said in a previous answer to the hon. Member for Sefton Central, I will happily provide him with the letter to which he has referred. However, I point out that the Secretary of State has communicated comprehensively with colleagues and with the devolved Administrations, and through officials. There has been no lack of communication between the Secretary of State and the devolved Administrations.

The hon. Member for East Lothian referred to appeals against decisions. The CMA is not the arbiter; it will be the decision maker, and the courts—either the High Court in England and Wales, or the Court of Session in Scotland—will make the judgment on an appeal. Looking at how the EU regulations already work, the Commission makes a decision and the courts then make a decision on an appeal. All law will always be a mixture of legal judgments and future policies. There is no contradiction in what I have said. The CMA will effectively be the decider and will hold the powers, and it will be for the courts to decide whether that decision is correct.

[Brendan O'Hara (Argyll and Bute) (SNP)]

I appreciate the fact that the Minister is taking so many interventions. This SI, like so many others, seems completely half-baked. Given that there is such opposition to it in Cardiff and Edinburgh, can she tell us whether the discussions with the devolved Administrations have ceased, or are they ongoing? Has any thought been given to what indemnifying policy or process could be given to the Scottish and Welsh Governments, should they be found in breach of these state aid regulations?

[Kelly Tolhurst]

I point out to the hon. Gentleman that the devolved Administrations are highly aligned with the policy position on setting a UK-wide state aid regime. Our conversations with the devolved Administrations are ongoing and will continue as they are. The Secretary of State has made it very clear that he is committed to meeting the devolved Administrations to discuss these matters and many others in relation to how we exit the EU. In fact, the Prime Minister has made it clear that, were we to enter into an agreement with the European Union and therefore not be in a no-deal situation, we would extend the opportunities for devolved Administrations to feed in.

--- Later in debate ---

[Kelly Tolhurst]

The hon. Gentleman makes a good point. If we entered into an agreement, we would go into an implementation period, and we would be bound by EU rules as they stand until the end of that implementation period. In any arrangement for our future relationship with the European Union, state aid would be subject to debate and to further negotiation and agreement. It would not be right for me to anticipate that. I am here to talk about a no-deal scenario and the legislation in front of us.

On the hon. Gentleman’s shopping list of state aid requirements—the things he would like to spend money on—I point out that the Post Office effectively does receive state aid. We subsidise the Post Office. We have maintained our network of 11,500 post offices, unlike previous Governments, who have undertaken programmes of closures. I am proud to stand here as the Minister responsible for post offices and say that the Post Office is in a much better place financially than it has been for many years. We are committed to delivering postal services in rural areas, and there are a number of funds to support that. I am determined that that will continue under these regulations.

It is a matter for debate whether, how, where and how much money will be granted to other worthy schemes. It is not for us to decide today which schemes and which parts of the country will receive additional funding. This debate is about the regulations—the rules—and how those decisions will be made. I understand the hon. Gentleman’s wants, but this debate is about the rules for agreeing or disagreeing.

The hon. Gentleman spoke about support for the regions. As he will know, the regional growth fund and most of the regional support funds granted through state aid are covered by the block exemption regulations, so these measures do not stop the Government supporting local communities and regions where required. This Government operate a successful industrial strategy and are determined to continue to invest in research and development, regional growth and opportunities, particularly for small and medium-sized enterprises. Let us not forget the funding available from the British Business Bank, which is an example of where those regulations have been used to benefit SMEs and provide access to finance.

On the devolved Administrations, I repeat that the Government consider the regulation of state aid to be reserved to the UK Government. However, individual choices about how and when to give aid within that framework are for public authorities, including devolved Administrations, to make. The devolved Administrations will have full autonomy in state aid case management and in dealing with the CMA. As I outlined, I recognise that there is a difference of view about whether the regulation of state aid is a reserved matter. However, given that the UK Government are closely aligned with the devolved Administrations on the substance of the policy, and given the limited scope to depart from mirroring the EU regime using powers in the regulations, it is not necessary to resolve that question now. The Government will continue to work closely with the devolved Administrations on the development of state aid policy.

[Brendan O'Hara]

The Minister says it is not necessary to decide that now. If not now, when will it be decided?

[Kelly Tolhurst]

As I have already outlined to the hon. Gentleman, the Government are clear that we believe state aid to be a reserved matter. I have tried to outline that a number of times, and I have outlined that there will be no loss to the devolved Administrations.

As I have said, under the current regulations, when the devolved Administrations decide to give aid they have to notify the European Commission. In the future, they will notify the CMA. As I have outlined, the Secretary of State will continue to consult, work with and have conversations with the devolved Administrations on any future aid policy. The Secretary of State has made that commitment, and there is no reason to suspect that it will not happen.

Exiting the European Union (Structural and Investment Funds)

Brendan O'Hara Excerpts

Tuesday 19th February 2019 Commons Chamber

[Brendan O'Hara (Argyll and Bute) (SNP)]

Like the hon. Member for Newcastle upon Tyne Central (Chi Onwurah), we will not oppose this SI this afternoon, but we do share many of the deep concerns, particularly in relation to what exactly the UK shared prosperity fund will be and what it will mean. Of course, this SI would not be necessary if the Government would simply take the threat of a no-deal Brexit off the table. They could, if they so choose, remove that threat today, but instead they have decided—very cynically, in my opinion—that it is too politically useful to have as a tool in order to bludgeon MPs into supporting a deal that we have already rejected as the clock runs down towards 29 March. However, if the Government insist on preparing for the possibility of a catastrophic no-deal scenario, then yes, this SI does allow for the transfer of regulations in order to ensure the continued roll-out of the European agricultural fund for rural development and the European maritime and fisheries fund. The SI will continue to allow payments until their closure after the end of the current 2014-20 programming period.

It is worth pointing out the huge importance of those funds to communities right across Scotland, particularly in remote and peripheral areas such as my Argyll and Bute constituency. The EU structural funds in Scotland are worth up to €941 million across the EU budget period, for use in economic development. Over £500 million a year comes to Scotland from the common agricultural policy in the form of direct payments to farm businesses and rural development funding. The UK Government have provided short-term guarantees to replace most CAP funding until 2022 following Brexit, but no firm commitments have been given about replacing the CAP in the long term.

[Mr Simon Clarke]

It is important to note that the Agriculture Bill provides for ensuring that environmental incentives are aligned with good practice in agricultural management. I think that hon. Members of all parties want that. It will be a welcome change from the way in which the CAP simply rewarded the largest farmers.

[Brendan O'Hara]

The hon. Gentleman makes the important point that we are discussing the SI before Report stage of the Agriculture Bill. I will come back to that. I do not necessarily defend the way in which the CAP is administered—the way in which every pound is allocated—but it is important to recognise the amount of money and support that the CAP gives UK agriculture, particularly those less favoured area support scheme parts of my west of Scotland constituency.

[Kirsty Blackman (Aberdeen North) (SNP)]

My hon. Friend is making a great speech. On the lack of certainty beyond 2022, are not those in farming communities planning a long way ahead for what they intend to do with their land? Certainty beyond 2022 would help them in their long-term planning for their stewardship role as well as for trying to make money.

[Brendan O'Hara]

My hon. Friend is right that it is vital that our farmers have the ability to plan into the future. At the moment, we enjoy that ability to plan long term, and the fear is that that is being taken away.

The common fisheries policy is co-financed in Scotland through the European maritime and fisheries fund, and Scotland is allocated 44% of the total UK figure, with £42 million—over 80% of the Scottish allocation—already committed to projects. Competitive funds are awarded directly by the European Commission to organisations, and that includes significant research, innovation and education exchange programmes. Since 2014, Scottish organisations have secured €533 million of Horizon 2020 funding, €65 million of Erasmus+ funding and €58 million of European Territorial Cooperation funding. Even since 2016, the European Investment Bank group has signed loans worth €2 billion for projects in Scotland.

These EU-funded programmes represent a vital source of funding to communities right across Scotland, but as I said earlier, they are particularly important to peripheral communities, which are in greater need of support. That is why, when the question was asked in 2016 whether we wished to remain part of the European Union, every single part of Scotland, without exception, urban and rural, said yes to staying in the EU. Our communities knew—and still know—the benefits of being a member of the European Union and the significant difference that that has made to their lives, economically, socially and culturally.

[Alison Thewliss (Glasgow Central) (SNP)]

My hon. Friend is making some great points. Is he aware that urban areas such as Glasgow have hugely benefited as well? Since 2010, regional selective assistance grants to businesses in Glasgow have provided more than £83 million of investment and created 7,292 jobs.

[Brendan O'Hara]

It is absolutely remarkable that all 32 Scottish local authority areas—urban and rural, with the vast differences that exist between them—said with one voice that we as a nation wished to remain in the European Union. That cannot and should not be ignored. Its significance cannot be underplayed.

The loss of the funds I listed earlier could be absolutely devastating for our farming and fishing communities. As yet, there are no guarantees about the continuity of these funds beyond 2020. Here we are, a month from Brexit day, and there is still no certainty for our farming and fishing communities as they plan for the future.

[Kirsty Blackman]

My hon. Friend is making a great point about funding. Does he share my concern that these communities will be hit doubly, because there will also be changes to immigration, which may mean they do not have access to labour? Given that some of our areas are suffering from depopulation, which we have worked very hard to counter, does he feel this is a double whammy that rural communities cannot afford?

[Brendan O’Hara]

My hon. Friend may well have been looking over my shoulder, because I was about to come on to that very point.

My constituency of Argyll and Bute is suffering from massive depopulation. We are losing population at a rate that we cannot sustain. We need to get people to come and live, work, invest and raise families in Argyll and Bute, and much of our plan is predicated on EU nationals coming to Argyll and Bute to fulfil that function. We are being denied access not only to funding, but to people. Unless we can find a way of squaring that circle, which I do not think is possible, then I fear for the future. That is why independence, with an independent Scottish Government being represented as an equal partner in the European Union, is without doubt the only way that Scotland is going to prosper.

It has been reported just today that the Environment, Food and Rural Affairs Secretary has told the National Farmers Union, in relation to UK farmers, that

“there is no absolute guarantee that we would be able to continue to export…to the EU”

under a no-deal scenario. This is the chaos into which we have descended.

As has been said, the UK Government have of course promised to replace EU funds with a much-vaunted UK shared prosperity fund, but despite all the repeated promises, still no detail or definition has been given about how that new structure will operate. May I ask the Minister when we will find out the detail of this shared prosperity fund, and when will we know exactly what it will mean for people across the UK, including for people in my Argyll and Bute constituency?

Will the Minister tell me, post-2020, when the cycle of these current EU funds comes to an end, how the proposed new system will operate? What consent and control will the devolved Administrations have in relation to this future funding model? What consultation has been carried out to ensure that this new system will have the consent of and remain consistent with the devolution settlement? Will he explain why, as I said to the hon. Member for Middlesbrough South and East Cleveland (Mr Clarke), this statutory instrument has come to the Floor of the House before the Agriculture Bill and the Fisheries Bill have even reached their Report stages in this place?

Given that the President of the European Commission has promised to support Irish farmers financially in the event of a no-deal Brexit, why have the UK Government not offered similar support to Scottish farmers? Finally, does the Minister agree that so much of this worry, angst and trauma we are being put through and putting other people through could all be prevented if the Government simply took no deal off the table?

Delivery Charges (Scotland)

Brendan O'Hara Excerpts

Wednesday 20th December 2017 Westminster Hall

[Brendan O'Hara (Argyll and Bute) (SNP)]

I will keep my remarks brief as a courtesy to colleagues who wish to speak. The issue of fair delivery charges to Scotland has had no greater champion in this place over the last two and a half years than my hon. Friend the Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry). It is an issue not just for this Parliament but for the Scottish Parliament, and I pay tribute to the work of my Scottish National party colleague, Richard Lochhead, the MSP for Moray, who launched the fair delivery charges campaign and who led a debate in the Scottish Parliament a couple of weeks ago.

In preparing for today’s debate, I sought examples from my constituents and I was deluged—almost overwhelmed—with the examples from the people of Argyll and Bute. The one from Alex Samboerk from Lochgilphead was notable. Lochgilphead is not on an island; it is 88 miles from Glasgow and it takes less than two and a half hours to get there. Alex went online and bought a case of 28 healthy fruit and cereal bars. The cost was £17.81. When he went to check out, he was astonished to see that for the PA31 postcode in which he lives, the economy service was £90 for delivery. Alex is not alone. I have been inundated with people complaining about such things.

My wish is that this is the last time we have to debate this issue. I hope that the Minister can say that she and the Government will take on board the anger and frustration that has been felt throughout rural Scotland at this unscrupulous and outrageous practice by some delivery companies. As I said, I will cut my comments short as a courtesy to other speakers, but let us never have this debate again.

Oral Answers to Questions

Brendan O'Hara Excerpts

Tuesday 12th December 2017 Commons Chamber

[Greg Clark]

I do not agree with the hon. Lady, and if she reads the industrial strategy she will see that the biggest increase in science and innovation investment for 40 years has been triggered by this. It is the right way to go, and it has been welcomed by all parties across the country. It would be helpful if the hon. Lady recognised that many other countries have benefited from a strong national commitment to improving investment in productivity, such as through science and innovation, and that gives confidence to overseas investors.

[Brendan O’Hara (Argyll and Bute) (SNP)]

4. What steps he is taking to support the development of renewable energy sources in Scotland.

[Hannah Bardell (Livingston) (SNP)]

18. What steps he is taking to support the development of renewable energy sources in Scotland.

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)]

Over a third of projects supported by contracts for difference are located in Scotland. In October, we announced plans to allow wind projects on the remote islands of Scotland to compete for support in the next auction. We have submitted a notification of our plans to the European Commission.

[Brendan O’Hara]

My constituency has much going for it, including an abundance of wind and water, making it an ideal place for all kinds of renewable energy projects. What will the Government do to provide revenue support to renewable energy companies during the innovation period while they work to bring down costs?

[Richard Harrington]

I am sure that the hon. Gentleman has read the industrial strategy avidly; if he has not, I warmly recommend that he does so, as it covers these matters extensively.

Renewable Energy Generation: Island Communities

Brendan O'Hara Excerpts

Tuesday 4th July 2017 Westminster Hall

[Richard Harrington]

I thank my hon. Friend for his intervention. Time does not permit me to answer in full, but I would be happy to meet and discuss this subject with him on behalf of his constituents.

Thirdly, we have to define what is meant by “island wind projects” in a legal context, and that is being done; we are working through the issues. The right hon. Member for Orkney and Shetland is very aware of that matter.

Last but not least, we need to give clarity to the developers of island projects while being fair to developers of other projects elsewhere and to consumers across the UK.

[Brendan O’Hara (Argyll and Bute) (SNP)]

This issue is also very dear to my hon. Friend the Member for Na h-Eileanan an Iar (Angus Brendan MacNeil), who has been unavoidably delayed while travelling here today. He is very concerned, as I am. Given the promises made in the Tory manifesto and by Tory candidates at the general election, when will the Government act to introduce an island CfD? The lack of a CfD and the locational pricing model are severely hampering the industry on the islands, and this is a vital sector that we need to survive.

[Richard Harrington]

I can assure the hon. Gentleman that we are aware of that issue and we are fully on it. I am happy to meet him if he would like to discuss it separately, but I have only five minutes left now and I do not want to break into the time for the key points that I need to raise.

There is a range of options for overcoming the issues that I have outlined, and I hope that by taking a pragmatic approach we can do so quickly. We need to understand the costs of the projects and the impacts on consumers’ bills. My officials have begun the process of updating the evidence base to set an appropriate strike price—the maximum that these projects could get paid for each unit of electricity that they produce. We must not forget that any additional costs that arise as a result of awarding support contracts are ultimately paid by households and businesses in their electricity bills.

Our approach to supporting new renewables, of competitive auctions with limits on the maximum price that we will allow, ensures that we support only the more cost-effective projects. That approach is not new but has been applied very successfully to other technologies, such as offshore wind. The industry is confident that the renewables support auction currently under way, whose outcome is expected in the coming months, should lead to a significant further drop in price. Whatever approach we take will need to work in this context of quite rapid price changes, and we want to see the outcome of our current auction before making decisions regarding the remote Scottish islands.

We have been through very clearly the importance of local support. Not everyone in the islands will support the development of the wind farms, but I am told that the majority of residents do. I understand that a poll of 1,000 Isle of Lewis adults commissioned by Lewis Wind Power found that seven in 10 supported having wind farms on their island. That is encouraging, but such support should not be taken for granted. It needs to be rewarded in the way that has been discussed—through community benefit funds and other systems. The Scottish Government have informed my officials that all the developers on the islands have committed to pay at least £5,000 per megawatt of capacity per year into such funds for the lifetime of a wind farm. That means that the Viking wind farm on Shetland, for example, could provide up to £1.85 million every year to the community. That money could be used for all sorts of projects: schools, local support groups, scout groups—the list is endless. Developers are also offering communities the opportunity to own a stake in projects, which is something that the UK and Scottish Governments are keen to see more of. Beyond direct income, we should also acknowledge the other benefits that these projects could bring. For example, jobs will be created not just during construction but throughout the lifetime of the projects.

Wind energy can play an important role for the country as a whole in producing the electricity we all need to support the running of our economy and our daily lives and in helping to reduce the harmful emissions associated with our energy systems. We all appreciate the commitment that island communities will have to make to ensure that we have access to long-term clean power. That is why it is absolutely right that they should benefit from hosting the projects.

We recognise that there are different ways of delivering the benefits, but of course it is important that any commitments that developers make are real and go beyond warm words. The Scottish Government are considering this issue closely, and I very much welcome that work. I look forward to meeting the right hon. Member for Orkney and Shetland and a group of developers, which we discussed outside the Chamber. That is a very good idea, which I am keen to progress as soon as possible.

I hope that my response today, in the short time that I have had, provides some reassurance to Members, as well as to the constituents we all represent, that the Government will support the development of onshore wind projects in the remote islands of Scotland, where they will directly benefit local communities.

Another very good point made by the right hon. Member for Orkney and Shetland is that we are not starting from scratch. We know that, and I do not mean just the manifesto commitment, but everything that went before.