Brian Binley
Main Page: Brian Binley (Conservative - Northampton South)Postal Services Bill
Brian Binley Excerpts(13 years, 4 months ago)
Commons ChamberRead Full debate Read Hansard Text
Bob Russell
I am bound to say that that was not a very helpful intervention from my hon. Friend, particularly as I share a flat with him. At the very least, he could have raised those concerns over the breakfast table.
I think I have made it clear that I am not a fan of the privatisation. I accept the reality of what is going to happen and I am suggesting to the Minister what I think would be in the best interest of our communities. I think that I am making an overwhelming case and it would be great if he accepted my new clause. The previous Government brought in measures on sustainable communities and we are now talking about localism, which is right. To say that the previous Government decimated the system would be wrong: they did more than that because decimation is only 10% and I would have settled for 10%.
Mr Brian Binley (Northampton South) (Con)
Would not this measure make the whole transfer or sale deal much more viable and do much more to guarantee the viable retention of a post office network? If it is not accepted, that will all be in danger.
Bob Russell
I am grateful to my hon. Friend for that extremely helpful intervention. Regardless of what we think of the Bill, we all want to retain as many of our sub-post offices as we can.
Michael Connarty
Tomorrow, the Liberal Democrats will find out the value of making various pledges to the public and then breaking them. Even the proposal to privatise 50% of the Post Office, which was very similar to the proposal that a certain Minister in the Lords made on behalf of the previous Government, has been betrayed by the Liberal Democrats. I shall support the new clause, because it is a cross-party proposal that would ameliorate some damage for a short term. The most important thing, however, is to vote against the Bill and to let people know that what is being done is a dirty deal by the Liberals to let the Conservatives privatise and smash the post office network.
Mr Binley
I congratulate the hon. Member for Linlithgow and East Falkirk (Michael Connarty)—he must have trouble pronouncing that; I have trouble with Northampton South—on a robust speech, and I pay tribute to his defence of the Post Office over a very long period. His colours have been clearly nailed to the mast, and that we must accept.
I say to the Minister that I support the general thrust of the Bill, with which I have no problems. I have been a critic of Post Office management for a sizeable time and believe that the organisation’s senior staff should be ashamed of the results of their management. It is true that they produced a bottom line that looks slightly healthier, but they left an immensely demoralised work force whom they bullied most unacceptably for years. I might tell those managers that if they had worked for the company of which I am chairman, I would have sought their dismissal.
Let us be absolutely clear that the Post Office and the Royal Mail have not been well served by senior management over recent years, and that makes the difficulty that the Government face even greater. I understand that point, and it is one reason why I have argued consistently for a massive injection of good-quality, creative management in the upper levels of the Post Office’s management structure. We have not seen that; we have seen City hatchet men, just at the time when it was necessary to bring in creative, technological management. But this House shares a sizeable amount of the blame for that outcome. I would have wanted things to be done differently, as indeed would the hon. Member for Linlithgow and East Falkirk. We have argued for that jointly. We might disagree on a number of things, but on that we have been as one.
I genuinely share the Government’s ambition to create in the Post Office a new management structure that can come to terms with a quickly and massively changing technological marketplace. That particular attempt is absolutely vital, and it means a sizeable commercial injection from the private sector. I have no doubt about that, or that the Post Office was one of those organisations that had almost immured itself from the necessary quality of management. I have equally no doubt, however, and I shall say it again, that bringing in City hatchet men was not the way to deal with the problem.
Mr Davey
It is not appropriate for me to comment on the previous management, but I invite my hon. Friend to contact the new chief executive of Royal Mail, Moya Greene, and the new managing director of Post Office Ltd, Paula Vennells. If he seeks to meet them and to listen to them, he will find that the management in Royal Mail and in Post Office Ltd are of the highest calibre.
Mr Binley
I, of course, welcome the Minister’s intervention in that respect. I have no wish to vilify the current management; I just make a statement about why we are in our current position with the Post Office. We have to be realistic if this debate is to have any meaning at all. I have outlined an important reason for being in the position we are in, and I have no fear in doing so.
Michael Connarty
Will my hon. Friend—on this issue—take from me a factual statement? In front of witnesses, we met the previous Minister with responsibility for the matter, Lord Mandelson, and put it to him that the manager, Crozier, who by the way comes from Falkirk, had been an absolute disaster and failed. One of my party’s Whips asked why he was still in post, and Lord Mandelson’s civil service leader said, “He was the best we could get at the time.”
Richard Fuller
To echo the Minister’s comments about the observations on the current management by Members on the Public Bill Committee, I note that there has been a substantial improvement on the legacy management. The current management really shine a torch forward for Royal Mail Group. Does my hon. Friend the Member for Northampton South (Mr Binley) echo my sentiment that, in the sight of ineffective, hostile management over many years, there was an excellent outcome when the Communication Workers Union and other unions put together a modernisation programme and commitment for our postal services, privatised or otherwise, for the long term? That was a substantial triumph by the unions against hostile management.
Mr Binley
I accept that interjection and support that point, too, because I was one of those who consistently said that we should be proud of our Royal Mail work force. I am sure that my hon. Friend visits his local sorting offices, as the hon. Member for Linlithgow and East Falkirk and I do. We visit our sorting offices and post offices regularly and we know the quality of people we are dealing with. I would be proud to have them in any organisation with which I was associated, so paying tribute to the work force at this stage has real value. I accept that and thank my hon. Friend for his intervention.
To return to the main thrust of my contribution, I am concerned that, unless we are careful, the separation of Royal Mail and post offices will have a sizeable detrimental effect on the viability of the post office network. The truth is that the network is a diminishing resource even as we speak. My hon. Friend the Member for Colchester (Bob Russell), who moved the new clause, said that some post offices had temporarily closed. Well, if you believe that, you’ll believe anything. In truth, they are closed for business, just as many pubs are, which is another problem in rural areas—but not a part of the Bill.
Mr Weir
I have some experience of the Post Office in my constituency, and a long-term temporary closure effectively means that, although the Post Office accepts that there should be a post office in that location, the branch has closed because someone has retired or died and the organisation cannot find anyone willing to take it on. One reason for that is uncertainty about the future.
Mr Binley
I am most grateful to the hon. Gentleman, whom I worked with for some time on the Business, Innovation and Skills Committee, for that intervention. He spent many hours with me questioning the management whom I have criticised so heavily. He is absolutely right: temporary closure does not take into account the fact that post offices are private businesses that need to have people to buy them, run them and invest in them. My hon. Friend—I mean the hon. Gentleman, but he is still my friend—makes a valid point. The post offices are for sale, but there are not any buyers for them. The reason is not difficult to work out. I have grave concerns about the viability of the Post Office.
Jim McGovern
I am sure that the hon. Gentleman would agree that we—or any new owners—must push business towards the post office network. During the last post office closures in 2007-08, I visited the sub-post offices in my constituency. The sub-postmaster of one of them freely told me that he renewed his TV licence and his road tax online. In addition, seven out of 10 pensioners and nine out of 10 new pensioners get their pension paid into the bank. We need new business for the post offices. That sub-postmaster was willing to bite the Government’s hand off for the compensation he was getting because he just wanted out.
Mr Binley
I accept the hon. Gentleman’s comment. The Post Office could have been much more imaginative in supporting sub-post-offices to increase their business. Over the past 10 or 12 years, the lack of that support has been one of the reasons why they are less viable as a business than they should be—even the good ones now are less viable. We must accept that steps have been taken recently and I welcome that. However, the general thrust of his intervention is absolutely right.
Let us consider the post office network. I have already made the point that 150 post offices are closed and will remain closed because there are not the buyers to buy them. Some 900 are up for sale, which supports that point totally. Let us not mess about with stupid phrases such as “temporarily closed.” They are pretty much finished and that is the end of it. We need to be honest.
Damian Collins
Does my hon. Friend agree that the problem he describes affects not just post offices, but businesses in neighbourhoods and rural communities in general, and that some of the provisions in the Government’s Localism Bill and in the White Paper, “Local Growth: Realising Every Place’s Potential,” might help to stimulate interest in communities and local government to support those businesses?
Mr Binley
I thank my hon. Friend for that intervention. He knows that I agree with that view—in fact, we have talked about it. We fought the 2005 election together. That was a very happy experience for me; I wish it had been slightly happier for him, but it is good to see him in the House now. As we fought that election together this was one of the issues we talked about at some length. I accept his point.
The very fact that more than 1,000 of our post offices are either closed or up for sale shows that there is concern about the viability of the network. It is not in doubt that we have some serious problems. I shall come to the impact that those closures might have on many of my colleagues in rural seats in two or three years’ time. We went through a process of fighting to save post offices and I will describe how I experienced that process and how difficult it was to deal with as a Member of Parliament, even though I was an Opposition Member. It will be much more difficult for many of my colleagues to deal with the matter as members of the Government. The Minister may well take that point into account. However, the separation of Royal Mail will create massively greater pressures on the commercial viability of many of our post offices, unless we give them more time to adjust. That is the point of all this.
Margaret Curran (Glasgow East) (Lab)
Will the hon. Gentleman draw parallels between his experience of representing rural areas and my experience of representing very deprived communities that are often isolated, where the post office is a vital lifeline? Perhaps we should support the new clause—although it is proposed by a Member from an opposing party—because the very best thing we can do is to preserve that historic link between Royal Mail and the post office network. We can at least offer people that crumb of comfort from the legislation.
Mr Binley
I share that sentiment—in fact, it is the thrust of my contribution. There is no doubt that urban and suburban post offices are as important to their communities as rural post offices. In the main, urban post offices have a bigger market to exploit if they are given the help to do so, but that is all the advantage they have. They are still in difficulty and they still face considerable danger. I totally accept the hon. Lady’s point.
Damian Collins
My hon. Friend talked about good and bad management in the past. Does he agree that we should not let Post Office management off the hook and that they should continue to innovate in terms of how they deliver their services, particularly in relation to the roll-out of the post office local service? That service could integrate well into existing businesses, both in villages and urban areas.
Mr Binley
I thank my hon. Friend again for his intervention which is, of course, quite supportive of my words; I am grateful.
I accept the point made by the hon. Member for Glasgow East (Margaret Curran). The truth is that our local post offices are more than just local small businesses. They are that at their very heart, but they serve a wider purpose in many respects. They are vital to our local community networks, as she said, and they are crucial in urban, suburban or rural areas where they are the only point of contact for perhaps a mile or more.
There is a social networking element to my local post office—I pay tribute to it and I shall name it, as I hope it benefits from my doing so—in my village of Hackleton. I know the quality of service that post offices give. Elderly, vulnerable people go in them and seek help on a range of subjects that are way outside the remit of the post office. That help is given willingly as part of the service that post offices provide. The community networking element of our post offices has a value that we have not priced into this whole exercise, and that needs to be taken into account.
Caroline Lucas (Brighton, Pavilion) (Green)
I very much want to support the focus on the community role of local post offices. We have focused on the economic role, which is massive, but the community role is so important. Figures provided by Age Concern show that more than 98% of older people say that their local post office is a lifeline. For some people, the issue is almost a matter of life and death, which is why this debate is so important.
Mr Binley
I thank the hon. Lady for supporting my point.
In addition to the community networking element, post offices have a social work element as well. I have hinted at that, particularly—as was just said—in relation to the elderly and young mums in our communities. Many of those young mothers, who are building families and creating the generations of tomorrow, have only one car. Many of the elderly do not have a car. If such people are not close to a post office, they are, frankly, even more socially deprived.
Fiona O'Donnell (East Lothian) (Lab)
Does the hon. Gentleman agree that, during the bad weather that we had at the end of last year, the role of local post offices that have been combined with small shops was even more important in constituencies such as mine because people could not travel to large supermarkets?
Mr Binley
I am grateful to the hon. Lady for her comments. I think that these interventions are making an impression on the Minister. I am sure that he is well aware from his own experience of the social role that post offices play and that he will have taken that into account. I hope that when I sit down after having made a suggestion to him, he might be able to agree with me, throw me a little red meat, be kind and make all of us feel a bit better as a result of the debate.
I have talked about support for the elderly and young mums—the people without transport. The Government say that there is not a social element to their thinking, but there needs to be, as they will surely find out, as individual Members of Parliament. If people find out some six months or a year before the next general election that that has not been taken into account, those colleagues will be kicked pretty hard, I can assure them, because that happened to many of us in the previous round of closures.
Ian Murray
It is not inconceivable that a company such as Deutsche Post could buy Royal Mail. When such a transaction happens in Germany, the post office network is protected by law. As a result of the cost implications, Deutsche Post could run down our post office network to subsidise its post office network in Germany.
Mr Binley
I thank the hon. Gentleman for that supportive intervention. That gives us even more reason to ensure that there is a business agreement to tide the post offices over. We need to ensure—not to hope, guess or think—that they have the time, and therein lies the great value of the new clause. We must give them time; otherwise, we cut their legs off almost immediately. If we cut their legs off, many of my colleagues’ legs will go with them. We need to consider this particular aspect very seriously, not because I want to save the future well-being of my colleagues, although I am delighted to do so, but because if their legs get cut off it means that my worst fears have come to fruition and my local communities will suffer immensely. That is where the real concern lies in all this and why it needs consideration and thought.
I fought the closure of two post offices in the previous round. I am delighted that I was successful in one case, although I must say that I was suspicious that the Government had already decided to allow some to be saved merely to give the impression that the consultation had value. Can we really believe that? Well, I did, all the way through—shame on me! I was able to save, in one way or another, one of those post offices, but one of them closed, in a community where the elderly were a sizeable, if not predominant, section of the population. That meant that to get to the nearest post office they either had to hire a taxi or walk a mile and a third uphill. Frankly, the older one gets, it is just as dangerous coming downhill as it is going uphill. A number of those elderly people were distraught, as were some of the young mums with two or three kids, because their husbands needed the car to go to work and they had no other form of transport. They found it immensely difficult—and dangerous too, as the elderly did, particularly in slippery weather such as that which we have just seen.
Those are the sorts of little things that do not impact massively on decision making in this place but impact massively on the lives of individuals in our communities. I therefore implore the Minister to give some thought to the value of post offices as social and local community institutions, and to recognise that many of them will need time to make the adjustment. To cut off the supply of income that Royal Mail provides will be a damaging and, in some cases, a closure-making blow. Does he agree that they are a community network of social value? I am sure he does. I hope he also accepts that I want to see the success of this coalition and to see it returned as the next Government. Unless he takes action, however, he might be cutting off the legs of many of his colleagues—and indeed, for all I know, even his own legs.
I ask the Minister to think about this seriously. Perhaps, as my hon. Friend the Member for Colchester suggested, he would prefer a different time line and might be willing to consider three, four or five years. If so, I beg him to do so. The Minister may need that option to provide more help in his negotiations with potential buyers to ensure that the pill is sweetened a little in recognition of the cost implications. That sort of thinking would be massively valuable to our communities up and down the land. I would argue equally that in the real world of politics it could be massively helpful to many of my colleagues, and the Minister’s, who will be fighting for their political lives at the next general election. That is not the reason for doing it—the reason is to help the community—but I will use any arguments I can to encourage him to think about extending the agreement between Royal Mail and the Post Office, as the new clause suggests. I implore him to do so, for our communities and for our colleagues, but most of all for the well-being of our country.
Ian Murray
I support the new clause. I must say at the outset that I do not share a flat with the hon. Member for Colchester (Bob Russell), but it sounds like a fun flat to be in, none the less.
I hope that the Minister is listening to what hon. Members are saying. Prior to any sale or transfer of a post office company, an agreement should be secured between the new owners of Royal Mail and the Post Office for a period of 10 years—that is the suggestion, but it could be any number of years—in order to gain that transfer. Under the Bill, a privatised Royal Mail could break the historic link with the post office network and use another outlet such as Tesco, as the hon. Member for Northampton South (Mr Binley) mentioned. That might force customers to go much further to post offices to register parcels or to use the other services that people enjoy.
The Government have shown ambivalence towards post offices in this process. Everyone has talked of the importance of maintaining the link and the inter-business agreement between Royal Mail and the Post Office in some fashion, to ensure that the post office network is maintained. Although new clause 2 is not perfect, it would oblige a privatised Royal Mail to maintain the inter-business agreement with Post Office Ltd. The Government refused to listen to similar calls from the Opposition in Committee. Indeed, the Opposition spokesmen made those points clearly throughout the 20 sittings. Unless the Government make a strategic decision to put business through the post office network, the future of the network as we know it will be in significant danger.
As we have heard throughout the debate, the post office network has a declining share of the market because of the model in which it operates. The Government have an obligation to donate as many services as it is in their gift to donate to the post office network.
Mark Durkan
My hon. Friend is exactly right and he reinforces a point that was made earlier. The real issue is that the Government believe that potential investors will be put off if the agreement is seen to impose restrictions on their options for a period of years.
Mr Binley
Whatever happens, the recognition of 900 mail centres means that whoever buys Royal Mail will have to work with those people. They cannot possibly cut off those centres straight away, so an agreement of some kind has to be made for Royal Mail to continue working. Is it not right to say that we want to include the provision so that we know that an agreement will certainly be made?
Mark Durkan
I fully take the hon. Gentleman’s welcome point. That is precisely what we as legislators are being asked to do—provide some back-up certainty and reinforcement on such an agreement.
There is a suggestion that the EU would upset an agreement, or frown on it. Let us remember that we are not talking about the House suddenly legislating to impose an agreement on two currently free, private and commercial enterprises; we are talking about a very different starting point. All Members of the House and of the devolved Assemblies have dealt with lots of situations where, through legislation and other means, we provide for various restraints, guarantees, restrictions and obliged agreements in contracts over a period of years. Such provisions could relate to restrictive gas and energy licences over long periods, guaranteed contracts between providers in different markets to create stability, or even to opening and developing markets. Such things are done all the time, and the measures are respected and accepted by the EU.
Mr Davey
I will, of course, address that in detail, if the hon. Lady will let me. However, I first want to stress that it is the commercial incentive in the relationship that is so important. The Labour party forgets that commercial rationale is what makes people work together and what makes partnerships successful, not regulation.
I invite Members to consider the counterfactual of why Royal Mail would end its relationship with the post office network. Many of us fought the previous Government’s post office closure programmes precisely because the public value their local post offices so highly and see them as the natural place for high-quality postal services. As I asked on Second Reading, why would Royal Mail walk away from the Post Office, leaving a vacuum which its competitors would willingly fill? That would be commercial nonsense, and it will not do it.
The new clause would put the contract between Royal Mail and Post Office Ltd on a statutory basis, requiring a minimum duration to the contract of 10 years. Let me explain why I am opposed to this suggestion. I do not believe that legislation is appropriate place for the commercially sensitive terms of a relationship between two independent businesses to be settled. I am unaware of any statutory precedent for the Government requiring particular commercial terms between two independent businesses. When we debated this in Committee, I appealed to Committee members to tell me whether they could find such a precedent. None has appeared, and for good reason. These negotiations are best left to the businesses themselves, who know far better than we in this House their customers, the markets they serve, the products and the services they require of one another.
Mr Binley
I noted that the Minister said, “I do not believe,” and not, “It is a fact.” His not wishing to include this provision in the Bill is a matter of judgment, not a matter of law. May I add something on the idea of there being two independent businesses? In reality, the nation has a sizeable holding in them, so we are not quite talking about two businesses that are quoted on the open market. Would he therefore confirm that there is no legal reason why this arrangement cannot happen, even though it might be breaking new ground?
Mr Davey
I reassure my hon. Friend that I will be coming to this legal point and that I wish to address the remarks made by the hon. Member for Llanelli (Nia Griffith), but I stress that we were not given any statutory precedent for this arrangement. Contractual negotiations between these businesses will involve a complex interaction of many different factors, such as pricing, volumes, service levels and duration. If we adopted the new clause, there is a real danger that we could end up with an IBA that would damage the post office network. That has not been discussed at length and we should concern ourselves with it. The new clause focuses on the duration of the contract and, thus, would simply not achieve our shared objective of ensuring the strongest possible commercial relationship between Post Office Ltd and Royal Mail. The experts—the businesses and their advisers—should negotiate and agree the commercial relationship between the two businesses for the long term, rather than us here in Parliament.
On the key issue, Donald Brydon made it clear in his evidence to the Public Bill Committee that Post Office Ltd and Royal Mail would sign an agreement for the longest legally permissible period before a future separation. As shareholder, the Government will ensure that that commitment is met before any separation. I hope that the House will welcome this new commitment; we are making it very clear that we will ensure that Royal Mail delivers on the commitment that it has given, repeated and outlined to the Committee.
Mr Davey
This Government are governing. It was the previous Government who moved away from taking action on Royal Mail, who closed post offices and who did not take action. The right hon. Gentleman is absolutely right that we must make judgments, and we are making judgments. I can tell him the judgment that we will not make: the judgment that the previous Government made, which was that the way to sort out the post office network was to close thousands of post offices. We will not do that. The Government can and will help to create the conditions in which both businesses can flourish in partnership with one another.
One thing is certain. A struggling Royal Mail will lead to problems for the Post Office. The Bill introduces the ability to bring in much needed private capital for Royal Mail to invest in its transformation, so that it can offer the best service to its customers. It is important, too, that the Post Office continues to offer the best possible service to Royal Mail as well as to other current and potential clients. I am sure that hon. Members are well aware following the debate that we have committed funding of £1.34 billion, so that Post Office Ltd can invest in its network to ensure that that happens. For example, Post Office—
Mr Davey
No, not yet.
For example, Post Office Ltd is piloting branches that offer greater flexibility and convenience in customer services, such as longer opening hours. The Committee heard evidence from Paula Vennells, the Post Office’s managing director, that those branches offer customers opening hours that are between 40% and 60% longer than current opening hours. That is the real change that the post office network needs. That is the change that will attract more customers and will mean that we do not repeat the appalling closure programmes that we saw under the previous Government.
Mr Binley
I want to pin the Minister down, because it is vital that we do. He said that there was a “significant risk” that we might be challenged by the European Courts on competition matters. Yet the two organisations have agreed that it is vital that they have an agreement. How can the EU challenge the Government on that matter when there is an open statement to the effect that it is what is needed and what is good?
Mr Davey
Let me take my hon. Friend back to the point I was making about articles 101, 4(3) and 102. The point I was making was not that the two businesses cannot have an IBA. That is clear—they have one now, and they have committed to refreshing it or to creating a new one. I gave the commitment to the House today that we, as shareholder, will ensure that that happens before there is a separation. I hope that my hon. Friend will welcome that. The risk is about legislation and I hope he understands that point.