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Mr. Dismore: Will the right hon. Gentleman answer the straight question that was put by my hon. Friend the Member for Croydon, Central (Mr. Davies) to the hon. Member for Tiverton and Honiton (Mrs. Browning)? Do the Opposition believe in privatising the Post Office--yes or no?

Sir Norman Fowler: I speak for myself, but my answer is yes, yes, yes. I shall now develop that argument, having made my position reasonably clear.

Mr. David Willetts (Havant): Come off the fence.

Sir Norman Fowler: Perhaps I have not emphasised my position strongly enough.

We all want the Post Office to be a successful business, providing most of the basic services that it currently provides, although there may be a question about some of its parcels business. I hope that the hon. Member for Hendon (Mr. Dismore) accepts that there is no difference in aim between us. The difference is in how we believe that aim should be achieved. My view is that all those issues could be settled if we at long last plucked up the courage to put the Post Office into the private sector. That would give the management freedom to run the business without interference from Ministers, the civil service and the Treasury; the Government could lay down requirements on, for example, a universal postal charge; it would allow the Secretary of State to carry out an enabling role; and, above all, the business could prosper, which is the best way of ensuring continuity of employment--and good employment, at that--for thousands of Post Office staff.

Mr. Geraint Davies: Does the right hon. Gentleman accept that his prescription for privatisation would lead to the destruction of the rural network of post offices, and that the thousands of jobs that he mentioned would be under threat from a privatised company? Does he further accept that the third way forward of greater commercial freedom, which contains the amount of risk borne by the taxpayer, is surely the way to square that circle?

Sir Norman Fowler: I think that the third way forward is nonsense, and I think that the hon. Gentleman would agree with me. I do not think anyone believes that it is viable. It does not contain the risk--there is no question of that. Ministers and civil servants will still have to make judgments on what "no undue risk" means. The Post Office will be run like an old-fashioned nationalised industry, although perhaps a little better. As Secretary of State for Transport, I used to run a an old-fashioned nationalised industry, and, whatever the hon. Gentleman's views, it is no fun for the people running the industry. Whether one is Conservative, Labour or Liberal Democrat, it is a lousy way of running a business.

I do not agree with the hon. Gentleman. The Secretary of State said that the Government could have an enabling role. For the Government to lay down their requirements can be part of the privatisation process--I do not see that as a hurdle.

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Why are the Government not taking this obvious action? Frankly, the only argument against it is that the unions do not like the proposal, and like the idea of losing influence even less. However, that argument is not remotely conclusive. Privatisation may not be in the interests of the union, but that is not to say that it is not in the interests of the work force or the business. Those are the crucial tests.

There is nothing remotely new about the union argument. I carried out the first privatisations of the Thatcher Government in 1979 and 1980. We denationalised the National Freight Corporation, which has some similarities with the Post Office in that it was a transport business and delivered parcels. In addition, it was one of the biggest removals businesses in the country, although I never quite understood why the Government had an interest in running a removals business.

I also denationalised the British Transport Docks Board. It is now Associated British Ports, and is prospering in the private sector. Needless to say, both proposals were condemned at length by the right hon. Member for Hull, East (Mr. Prescott), now the Deputy Prime Minister, and the right hon. Member for Holborn and St. Pancras (Mr. Dobson)--who, I believe, remains one of Labour's candidates for mayor of London. Of course, the unions liked neither proposal. The Transport and General Workers Union argued strongly against the measure and brought its members to the brink of industrial action. It told its members in the NFC not to buy shares in the new company. Fortunately, many of those members ignored that advice and gained substantially as a result. That was a prime example of a union arguing from its own point of view, not from that of its members. Therefore, I do not regard it as having been a crucial argument.

Those companies were not, in fact, taken over by outside managers. There was no wholesale recruitment of new managers to scrap this job or that. The companies were run by the same managers who had run them in the public sector, such as Peter Thompson of the NFC and Keith Stuart. The skill was there--what was lacking had been the freedom to use it. That is exactly the position with the Post Office.

When, having left the Government, I returned to the NFC 12 years later as a board member, I do not recall anyone saying, "We really want to return to the public sector and to Government control. We loved having Ministers telling us what to do and checking our plans, and we loved having civil servants crawling all over us." I never heard that wish expressed by anyone, even though we must have had some of the largest annual general meetings of any public company. One reason for that was the substantial employee shareholding in the business--the staff had a stake in the business that they were working for. That is an important lesson about privatisation for both the Conservative and Labour parties.

The Government talk about joined-up government. Last week the Chancellor of the Exchequer announced new plans for helping workers to take shareholdings in their companies and to allow tax incentives to result from that. Here we have the opportunity to put that policy into practice by enfranchising thousands and thousands of people who work for the Post Office, and that opportunity is being turned down. That is a lesson not only for the

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Government but for my party: we need to learn that the opportunity that is there for us could fairly be said to have been there in the past.

My sadness about this proposal is that it represents a lost opportunity. I want a Post Office that produces and provides a good service but which is commercially skilled and nimble enough to withstand the competition from other forms of communication. That competition will come, whatever legislation the House may pass, and the Post Office will have to respond.

I want more than just that. I want the British Post Office to be an international as well as a domestic success. It is all very well arguing that we should give it time and that the country will get around to that solution, but time is not on our side. The opportunity may be lost, and, if that happens, the opportunity for Post Office staff will also be lost.

I suppose that I must accept that the Government will not now change their mind. Goodness knows, they have been round and round the course and have come up with the most unsatisfactory solution possible. I believe that when we look back, we will see this compromise proposal--this third way hybrid--as essentially a failure of will. We know the right way to go, and it is not this way. I hope that my party will take up the challenge.

11.29 am

Mr. Andrew Dismore (Hendon): Unlike the hon. Member for Tiverton and Honiton (Mrs. Browning), I preface my remarks by warmly congratulating my right hon. Friend the Prime Minister and Mrs. Blair on their happy news. I hope that it presages an early announcement of further improvements in the right to parental leave.

I shall concentrate on reform of the Child Support Agency. The Social Security Committee, of which I am a member, conducted a major pre-legislative review of the White Paper during the summer, culminating in the publication of its 10th report. I compliment the Government on the consultation that they carried out on reform of the CSA. Many of the witnesses who gave evidence to us commented favourably on the way in which the Government had taken on board the many representations and comments that they had received. I pay particular tribute to my noble Friend Baroness Hollis, the Under-Secretary of State for Social Security, who gave evidence to us twice and was helpful in dealing with our detailed and complex questions and requests for information.

I very much welcome the White Paper and the promise in the Queen's Speech of legislation. If we get it right--and I am confident that we shall--it will make an important contribution to the fight against child poverty. In his foreword to the White Paper, my right hon. Friend the Prime Minister says:


The reforms that we anticipate will put children at the forefront of what we are trying to achieve. The changes are not Treasury-led and no Treasury savings are being

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sought. The reforms are cost-neutral. They will set up a system that will work and not get bogged down in bureaucracy.

The Select Committee compared the original targets for the CSA with what has happened. That is set out in detail from paragraph 4 onwards. The report says that one of the objects


It continues:


    "Another of the major aims . . . was to 'produce maintenance payments which are realistically related to the costs of caring for a child."

Criticism was expressed of the then court system, which produced average payments of £20 a week in county courts. By May 1999, the CSA had reduced the average value of payments to £19.99 per week. That was a supermarket discount on the county courts, not an improvement that was originally presaged.

The original scheme was also proposed


but by July 1999 more than a third of a million periodic reviews were still outstanding. The report points out that the original White Paper


    "was critical about the length of time it took the courts to arrange maintenance. At that time half of magistrates court cases then were cleared within 7 weeks and the median for county courts was 19 weeks."

As of 31 March this year, 47,000 applications had been outstanding for over a year, representing almost a third of the total outstanding applications to that date. The new scheme was supposed to produce consistent and predictable results, yet it clearly failed to do so.

We all know from our constituency surgeries and correspondence how unpopular and ineffective the CSA has been. I shall illustrate that by quoting from a couple of letters that I received recently on the issue. One constituent wrote:


The letter says that


    "you can never deal with a single case officer: each time you make an inquiry you end up speaking to/receiving a letter from a different person--a recipe for confusion."

Another problem is that


    "it is often hard to penetrate the smokescreen of jargon to find out what is really going on."

In 1994 my constituent's wife


    "registered with the CSA in order to obtain maintenance. . . . So far she has got nothing.


    Last summer the CSA informed her that owing to a bungle on their part, she had lost any claim to three years worth of arrears arising out of a maintenance assessment made in June 1995--an amount worth nearly £15,000. . . . The CSA suggested she apply for compensation, which she did.

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    Eight months later she received a letter from the CSA last week saying they had been unable to process her application for compensation so far because they lacked the 'policy guidance' to do so. . . .


    In the meantime, the CSA made a fresh assessment of her ex-husband and told her that from 13 February her ex-husband would be making a payment to her."

I spoke to the family last night on the phone. Needless to say, so far nothing has come through.

Another constituent wrote to me:


the CSA--


    "in obtaining arrears, in excess of £2,500, due to me by my ex-husband. The result of this excessively long delay has caused me increasingly severe financial hardship and the knock-on effect is affecting the emotional well-being of my children. . . .


    I first requested the CSA collect maintenance for me in April 1997. . . . My children have been treated like punchbags. . . . Many debts have accrued as a result of the lack of maintenance . . . and I understand that even if a Liability Order is made, it will not include interest and probably will be payable by instalments. However, my debts have accrued substantial interest."

The letter writer goes on to describe how her case has been backwards and forwards to the courts. She contacted the enforcement office as requested a few days after the second hearing and was told that it had not heard from the presenting officer and would contact her as soon as it knew the outcome. Several weeks passed and several phone calls could not determine the outcome. She then contacted me. I investigated the case and found out what had been going on, but she has still not been contacted by the enforcement office and she has still not been informed officially by the CSA of the outcome. The letter continues:


    "The matter has dragged on for over 2½ years and it is looking to be nearer 3 years before effective action is taken."

Those two cases and our general experience show graphically the problems of the CSA, which were further illustrated by the recent television series that showed how the original CSA scheme was doomed to failure when it was set up because it was Treasury-led, which meant that there were fundamental errors from the start. It had to use a hand-me-down computer system that could not cope. There was nothing in it for lone parents because of the decision not to allow them to benefit from maintenance payments. The only things that lone parents got out of it were complex forms, grief from bureaucracy and often hassle from the absent parent. That resulted in an absence of trust, a lack of co-operation from lone parents and absent fathers, and even civil disobedience.

The Select Committee heard evidence from the National Association for Child Support Action. I asked its representative Mr. Farquarson:


His answer was:


    "Very simply. I do not believe that when the CSA make an enormous assessment against someone that is beyond their means to pay . . . that there is a moral . . . responsibility to pay that money. I would also say with no shame at all that I admit . . . that NACSA has been involved in a campaign of civil disobedience."

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The Select Committee rightly condemned that approach, but it is understandable from people who have a real sense of grievance because of the fiasco that the CSA has been. That is why I welcome the Government's new approach. A simple formula of 15 per cent., 20 per cent. or 25 per cent. of earnings will enable people to know where they stand much earlier. Admittedly, there is an element of rough justice, but people will be able to make their calculations early and they will know where they stand.


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