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7.59 pm

Siobhain McDonagh (Mitcham and Morden): I am grateful to the House for the opportunity to make a brief contribution to this debate, because I believe that the Post Office is one of the most important institutions in Britain. It provides a great public service, but it is in need of modernisation and reform, and great challenges lie ahead.

Having said that, I am worried that this debate is another in a series of debates in which the Opposition attempt to make the public believe that they have had a damascene conversion to public service, when what they are really about is doing down the public services and weakening public confidence in them. The Conservative party had 18 years' worth of chances to give the Post Office the commercial freedom in the public sector that the management and the Communication Workers Union desired, but they failed to do so. If they had taken action when they had the chance, our constituents would be receiving an even better service than they receive today, instead of which we are still running to catch up with Holland, Germany and the Scandinavian countries. We are still trying to give our nation the first-class postal service that we need to function and thrive in the modern world.

The review carried out by Tom Sawyer after Labour came to government in 1997 showed that there was much to be done to reverse the decline of the Conservative years, when there was no investment in the postal service and 80 per cent. of the profits were squirrelled away into the Treasury. It is revealing that we have heard precious little from Conservative Members about the starvation of the Post Office, the mistakes that they made and the consequences of those mistakes—for example, 3,500 post offices closed across the country when they were in power.

I believe that Labour is committed to maintaining a viable network of post offices across the country, unlike the Conservative party, which oversaw the closure of so many vitally needed post offices. We have shown that commitment by placing a formal requirement on Consignia to maintain the network of rural post offices, which do so much to support rural communities with the range of services that they offer and which provide a focal point for many out-of-the-way communities. It is important to many of my constituents in suburban south-west London—they are not rural residents but they care about the countryside as well as our public services—that that requirement and that commitment to the post office network is underlined, as we demonstrate again that the public sector Post Office is safe under Labour.

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Of course, we must not forget the value of post offices in towns, too. For example, in Collier's Wood in my constituency, I recently had the great opportunity to reopen a post office that was closed by the Conservatives 15 years ago. That post office in suburban south-west London provides an excellent services to pensioners, to people with young children and to those who do not want to travel too far to gain access to services. I believe that Labour understands the value of post offices in towns, cities and the countryside, and we have introduced appropriate safeguards to protect them for the people of this country.

As well as investing almost £500 million in modernising the postal network and developing universal banking services to allow benefits to be paid straight into post office accounts while ensuring that people who choose to have them paid in cash over the counter can still do so, Labour has given the Post Office the commercial freedom to enter into alliances, to raise more capital and to focus on better management practices. That is a welcome step, and the establishment of Postcomm to ensure that the principle of universal service provision is protected and to set and enforce standards of service is another welcome step towards ensuring that the public postal system, which has served this country well for the past 150 years, is built up and developed in the context of the public sector, not splintered and floated off into the private sector, as the short-termist Conservative party did so ineptly with Railtrack.

Of course, whether Consignia has used its new freedoms wisely is debatable, and to my mind that should be the true subject for today's debate. There are aspects of the company, particularly in its dealing with union representation, that are questionable.

Mr. Syms: Will the hon. Lady give way?

Siobhain McDonagh: No. I only want to make a short contribution, so I will not take interventions.

It is no longer for the Government to micromanage and intervene in every dispute that comes along, although I believe that we retain the responsibility to do so in extreme cases. Labour has quite enough on its plate with the reform and modernisation of all the public services to equip them for delivery—public services that the Conservative party either cheerfully sold off, or left to rot. I also believe we have a duty to the people of this country to encourage Consignia to work honestly and transparently with the CWU in resolving differences between the company and the work force.

Thankfully for my constituents as customers of the postal system, those differences have not been manifested in strikes. As a result of the agreement reached and facilitated following Lord Sawyer's report, there has been little or no industrial action since August last year. However, Consignia still insists that the work force are behaving militantly. Such claims can no longer be justified given the strenuous efforts which the union—led, I am proud to say, by my constituent Billy Hayes—has made towards dialogue with the company.

The union is at present conducting an industrial action ballot in pursuance of an outstanding pay claim that was due in early October last year. It is in discussions involving ACAS, and it has a desire to reach a negotiated settlement. The obstacle to such a settlement is Consignia,

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which time and again has shown itself reluctant to take constructive and progressive action towards resolving the claim.

On job security, the CWU has made good progress with Consignia and was hopeful of reaching a negotiated settlement based on voluntary, not compulsory, redundancy, despite the fact that Consignia apparently briefed the press after giving an undertaking not to do so.

To conclude, I believe that, since 1997, following the long, lean years during which the Conservative Government failed the Post Office and the people of this country, Labour has reshaped the service, providing a necessary period of stabilisation for further consultation and creating a public sector, public service organisation that operates in the commercial arena. The CWU is fully committed to making progress as outlined in the Sawyer report, having reached a good agreement with the employers on partnership. The CWU is waiting for that agreement to be introduced when the outstanding pay dispute is resolved. The key to that resolution is Consignia.

8.6 pm

Mr. Henry Bellingham (North-West Norfolk): A number of Labour Members, including the hon. Members for Mitcham and Morden (Siobhain McDonagh), for Chorley (Mr. Hoyle) and for Eltham (Clive Efford) have praised the Post Office's hard-working staff, and I join them in that praise. The hon. Member for Mitcham and Morden attacked the last Conservative Government, but the Labour party has been in power now for nearly five years, and I seem to remember that, when I was last a Member, the Post Office was making a lot of money, had excellent labour relations and was going from strength to strength. What we now see is in complete contrast to that.

I represent a large, rural constituency and, like my hon. Friend the Member for West Derbyshire (Mr. McLoughlin), I represent a significant number of small, rural sub-post offices. I also represent a number of people who work in a large Post Office sorting office at Baxter's Plain, King's Lynn. I visited that sorting office before Christmas and met a large number of its staff, and I was appalled at the very low morale that I discovered among those hard-working, dedicated postmen and women, who were sorting out their rounds, as well as among its long-serving management. It was a story of low morale, confusion as to where the industry was going and depression about the future. I found that very sad indeed.

I kept asking myself, "Why change the name of the operation to Consignia?" What the hell does Consignia mean? It is another example of new Labour political correctness. Why change an excellent brand—the Post Office, the Royal Mail—to something meaningless such as Consignia? That makes absolutely no sense whatever; it is a total distraction.

Mr. George Osborne: Is my hon. Friend aware that according to the National Audit Office report, the Royal Mail was the second most recognised brand in Britain after Coca-Cola?

Mr. Bellingham: Yes, I am aware of that, and I wonder how much was spent on management consultants, public

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relations people and advertising experts to re-brand the Post Office. That was completely daft and an utter waste of money.

Mr. Richard Bacon (South Norfolk): The answer to my hon. Friend's question is about £2 million. Is not the fact that people still refer to "the Post Office tower" 25 years after BT was hived off from the Post Office an indication of the incredible strength of the brand that the Government have started to throw away?

Mr. Bellingham: It was an extraordinary brand, and people worldwide would have paid a huge amount of money for it, but it has been chucked away under the aegis of this Government. The name change is nothing more than a ridiculous gimmick.

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