Lord Razzall
Main Page: Lord Razzall (Liberal Democrat - Life peer)Postal Services Bill
Lord Razzall Excerpts
Viscount Eccles
My Lords, the Postal Services Act 2000 “liberalised” the postal service. There are now, I think, 49 licensed postal operators in addition to Royal Mail, which is also licensed. If that number of people were willing to become postal operators, they must have expected it to be possible to do that successfully. As the noble Lord, Lord Lea, said, the Bill quite clearly states that there has to be a universal service, so whoever buys Royal Mail in whole or in part, wherever they come from, would not be acting in accordance with the law if they did not maintain a universal postal service. That is not really the problem. The difficulty we are in is that we have had an inappropriate regulation system in which the regulator tended to believe that competition was more important than the universal service and acted accordingly.
The problem with the universal service is that it is a monopoly. As noble Lords will have seen from the lobbying that they have had, it has been said that it will become a privatised monopoly. However, it is not a natural monopoly but a completely artificial one. It is not like a railway line or a water pipe. In my part of England, the so-called final mile is absolutely nothing like a final mile but a final 10 miles. It is running about on the roads, which are a public asset and nothing to do with the assets of Royal Mail or the Post Office. There has been confused thinking about whether the so-called final mile is an advantage or a disadvantage. The private operators are trying to tell us in this House that it is an advantage, an asset that enables people to charge monopoly prices. In fact, that is not what has happened. It has been entirely the reverse. The final mile is a disadvantage to Royal Mail. Therefore, in the progress of this Bill, we should concentrate more on regulation and the prospective system of Ofcom than upon anything else.
Lord Razzall
My Lords, I apologise for not being in my place on the previous day or at the beginning of the Second Reading-style speech made by the noble Lord, Lord Clarke, which of course I would have missed at Second Reading because he did not deliver it. Am I not right that this issue should be dealt with under Clauses 42 and 43? I thought that we would talk about the Ofcom relationship to the universal service obligation in relation to those clauses. I am very puzzled that we are having this discussion now. As I have said, the noble Lord, Lord Clarke, made a Second Reading-style speech, and no doubt ranged very widely over the topic.
Lord Razzall
My Lords, before the Minister responds, could I make one point that I think is important? In the context of a number of comments by noble Lords, there is an assumption that the cost of the universal service obligation bears most heavily on remote areas. However, the figures for Royal Mail show that that is actually not true. The real problem does not lie in Orkney and Shetland; it lies in Hampstead and Norwood Green.
Baroness Wilcox
My Lords, we have had a great debate across the Committee, which has been provoked by the noble Lord, Lord Clarke, whose credentials are immaculate in this area. I missed hearing him in the debate on Second Reading because he was not able to be here for it, so we have been able to listen to him today, when he has had the opportunity to put his words on the record. It is a great occasion for us to listen to him. I may not agree with everything that he says, but I believe in the absolute sincerity of what he says, given the background from which he comes.
I share the noble Lord’s desire to ensure that the universal postal service is maintained throughout the United Kingdom and I suggest that that is what binds us all together today. Given that we all want to see the universal service maintained, I suggest that we have no time to waste in getting the finances that we need to ensure that that is possible. It is the overriding purpose of the package of measures set out in the Bill. We need to ensure that the universal service is maintained both for the deliverers of that service and, as we heard, for the customers who need to use it. My noble friend Lord Razzall quite rightly referred to Part 3 of the Bill, which we will discuss in detail in future Committee sessions. It confers on Ofcom a primary duty to protect the universal postal service and gives it the powers to deliver that duty. A disposal of shares in Royal Mail may mean a change in ownership from the public to the private sector, but the obligation on Ofcom to ensure the provision of a universal service will remain.
Lord Clarke of Hampstead
My Lords, I start by thanking all those who have taken part in what has been a useful exchange of views on a whole range of subjects. Two noble Lords considered that my earlier comments were more suited to a Second Reading debate. I carefully looked at the background to my amendment and tried to draw from my experience to explain how it would affect the clause in the Bill. If I have offended the noble Lords, Lord Razzall and Lord Skelmersdale, I can only apologise.
Lord Clarke of Hampstead
That is a bonus.
I will briefly try to answer some of the points. The noble Lord, Lord Skelmersdale, was the first person to speak in the debate. I recognise that he is a most important person to the people whom I worked with all my working life: he is a user of the Post Office and Royal Mail. Every decent Post Office worker—they are all decent—knows that we rely on customers for our livelihoods. I pay tribute to him because I know from one of my first exchanges some 11 or more years ago that he was in the goods-by-post business. I always respected anybody who did not give work to the cowboys who are trying to undermine the Post Office.
The noble Lord, Lord Skelmersdale, asked how far people have got towards achieving the goals. I think that they have done pretty well. On the first goal, modernisation, there has been a terrific move. The previous Government could never answer questions about walk-sequencing machines, but we have seen those come in. We have seen changes in attendance patterns. There have been reductions in staff. It hurts when a member of staff loses a job. I would never have dreamt that the modernisation programme could have happened in so short a time as the past year or so.
Industrial relations have never been better in all the years that I have known the Post Office. There is a genuine desire to lift the Post Office and the Royal Mail in particular from the reputation that they were getting that they could not do their job. It is much easier now because there is only one delivery and you might get that in the afternoon. The rules have been changed, so there is bound to be some progress.
One thing that came out of the Hooper report, as has been said many times in previous debates, was the need for expertise in management. Everyone in the Committee will recognise the tremendous influence that Moya Greene has brought from running a big post office network in Canada and using that expertise to help us. Some of us were arguing two years ago that expertise could be found not necessarily in the board members of TNT, Deutsche Post or Federal Express. We found somebody worthy of being the chief executive and I pay tribute to her for the way in which she has welded together various different views.
I thank my noble friend Lord Hoyle for his support. He was one of the two or three of us who sat here night after night trying to get the previous Government to understand where they were going wrong. The noble Baroness, Lady Howe, asked for clarity. That is really all that the amendments seek. What is the intent? Let us have some detail.
The noble Baroness, Lady Kramer, whom I have not had the pleasure of meeting personally, made an important point about the need for private capital. It has been required for more than 40 years. That is why in my maiden speech in this House I said that we needed access to funds so that we could have automatic letter facing machines and optical character recognition—things that we were desperately trying to get hold of but were stopped by political interference. The external finance limit was always there to prevent us from getting the money that was needed. She is right. This is urgent and it will not stop when this present programme is over. It must keep on going to be successful. I thank her for illustrating that point.
My noble friend Lord Brooke talked about the European Union, but the less I say about that the better. I have perhaps said too much before about the way in which the Government stampeded into liberalisation without thinking it through. They told the world that we would have a Post Office fit for the 21st century. That was Stephen Byers, but I will not abuse this House by going back. I say to my noble friend Lord Brooke that the sooner we start thinking about the British Post Office and the British Royal Mail, the better for all of us, instead of looking over our shoulders at what other people are doing.
The noble Lord, Lord Swinfen, also talked about clarity and the need to be clear about what we mean when we talk about the universal postal service.
The noble Viscount, Lord Eccles, talked about the inappropriate regulator and the 40-odd private people who are competing for Post Office work. I am surprised that there are not 140 when they have been subsidised by Royal Mail all these years. The noble Lord, Lord Razzall, mentioned the regulator, although I did not introduce it in this sense. The new regulator must start thinking about this issue. The question is not whether this is about Hampstead or Norwood Green. There are parts of Hampstead where you could talk about the final mile, such as North End or Spaniard’s End. You could talk about the places where it takes a lot of time to deliver, such as the 140 flats in South End Close with 1,400 steps to climb. This was not discussed in the Second Reading debate, but as it has been introduced here I have a chance to respond. Thank you very much. As for Tony Young—I mean my noble friend Lord Young—it is wonderful to be on the same side as my own Front Bench. I am pleased to find that he is giving support for these measures.
I am sure that I am leaving out a lot of people, but I address my final remarks to the Minister. I thank her sincerely for her kind words. I know that every endeavour will be made to find accommodation as we go through this Bill. I recognise that she has a bit of a job on her hands, as there are so many competing interests out there, as well as in here. I just wanted to say thank you very much, because it has been a good debate. I shall reflect, as the Minister asked me to do, and I beg leave to withdraw the amendment.