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9.46 pm

The Parliamentary Under-Secretary of State for Trade and Industry (Nigel Griffiths): The debate has demonstrated the strength of support for the post office

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network in the House and the wider country, but I am sorry that support has not been unanimous among hon. Members. The motion is about mismanaging the Post Office. The Conservatives are experts on that.

Mr. McLoughlin: On a point of order, Mr. Deputy Speaker. Will you instruct the Serjeant at Arms to investigate whether the monitors are working? I am sure that Labour Back Benchers would like to come and support their Minister.

Mr. Deputy Speaker: That is not a serious point of order.

Nigel Griffiths: The Conservative party gave Britain record post office closures in the 1980s and 1990s and starved the network of investment. It is the party that saw industrial relations in the Post Office plunge to an all-time low. It is the party that today seeks to divide the House against the Post Office instead of rallying to its defence. The National Audit Office this week said that the Post Office gives high levels of satisfaction, good value for money and a lower cost than postal providers in other countries. We are not complacent, however, because we saw what complacency and inaction did before 1997. We do not claim that Consignia is perfect or that our radical reform package has achieved all that we want it to, but we have seen unprecedented investment go into our postal services at a pace of which the previous Administration could only dream.

The Conservatives have a new dream, though, as explained on the "Today" programme this morning. On their new policy, the shadow Secretary of State for Trade and Industry, the hon. Member for Maldon and East Chelmsford (Mr. Whittingdale), was asked whether he supported customers paying extra to get a better delivery service. Jim Naughtie asked him whether his message for the future was:

The answer was "yes."

The Conservatives know how to peddle the private health service and more private education; now they advocate a premium postal payment that would threaten the universal service. Our key priority is to secure investment for the universal service that meets the expanding needs of customers by providing a wide choice of services to give our citizens a postal service that is fit for a new era.

Mr. Andrew Lansley (South Cambridgeshire): Will the Minister stop ranting about the Opposition and answer a question about the Government's responsibilities? On what date last year did the Post Office first contact his Department to ask whether it was the intention of Ministers to reappoint Neville Bain as its chairman? Will he confirm that several months elapsed before Ministers made an announcement on 29 November and that on that date, the Department had put no measures in place for someone to succeed Neville Bain as chairman to ensure continuity of leadership and management in the Post Office

Nigel Griffiths: Neville Bain agreed to an extension of his contract, and the hon. Gentleman and the House know the subsequent results.

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The shadow Secretary of State opened with four assertions: that deliveries are falling short of targets; that many days are lost through strikes; that there are many post office closures, and that Consignia is operating at a loss. It will be pleasure to deal with all of them. Let us consider what the National Audit Office says about deliveries falling short of targets. I can confirm that the NAO found that 89 per cent. of first-class mail arrives the next day—the target is 92.5 per cent—which is 3 per cent. up on the figure under the last Conservative Government. I can confirm also that 98.4 per cent. of second-class mail arrives within three days, which is just below the 98.5 per cent. target and 2 per cent. up on the 1997 figure.

I turn now to the number of days lost through strikes, which is another subject on which the Opposition are experts. In the past five years, 195,000 days were lost through industrial action. During the previous five years, the figure was 933,000—nearly five times higher. The shadow Secretary of State spoke with great historical accuracy when he briefed Ceefax today and said that industrial relations were a shambles. Of course we are concerned about industrial relations problems, which at the moment are running at a fifth of their level in the last year of the Conservative Government. Management and the unions have been in talks with ACAS, and I urge both parties to take full advantage of arbitration and conciliation to obtain an equitable solution and avoid disrupting the service.

Poor management has been mentioned. Yes, there has been poor management, but it lay at the heart of that Conservative Government, when Secretaries of State failed to meet their 1992 promises to invest and to give the Post Office commercial freedom. Conservative Governments took £1.7 billion from the Post Office to pay for unemployment and other prices of failure. We, however, have strengthened the management with a new financial director and a new acting chairman, Allan Leighton. We have given the Post Office commercial freedom and invested £750 million.

I turn now to the concerns of all colleagues about post office closures. The House knows that between 1979 and 1997, 3,500 post offices closed; 16 were lost every month—almost three every week—for 18 years. Opera fans familiar with the Don Giovanni catalogue aria will have been interested to hear Conservative Members giving a list of post offices that have closed, but they were noticeably silent on the matter before 1997, when the post office network most needed their help. We are spending £270 million on modernising and sustaining the network, with more to follow. We welcome the reopening of 169 post offices between April 2000 and March 2001, which my hon. Friend the Member for Mitcham and Morden (Siobhain McDonagh) outlined.

Mr. James Clappison (Hertsmere): The Minister will know that benefit availability lies at the heart of the issue of whether post offices will stay open. Has he seen the letter from the Paymaster General to war pension recipients? Is it the case that payment through order books will be withdrawn from April this year? If so, how does that square with the Prime Minister's pledge on the continued availability of payments through post offices?

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Nigel Griffiths: I understand that that is not a state benefit but an occupational benefit. I am grateful to the hon. Gentleman for raising it because that gives me the opportunity to explain the time scale for deploying that procedure, about which several hon. Members asked. That will start in 2003, and be phased in over the next couple of years; that has always been the policy, and I am pleased to reiterate it to the House.

The hon. Member for Maldon and East Chelmsford spoke about Consignia's operating loss. He said that it was astonishing that such a great institution could be brought so low in such a short time. However, the Post Office was not brought low in a short time; it took the Conservatives 20 years to bring it to its present parlous state, and it has taken us five years to start reversing the decline. We have not heard one word of apology from the Opposition for years of neglect and underinvestment in our postal service. There is a history of low investment.

Mr. Challen: Does my hon. Friend agree that the long run of profitability in the Post Office began in the middle of the Wilson/Callaghan years? We started it; the Conservatives milked it.

Nigel Griffiths: My hon. Friend provokes me to say that profitability in the Tory years was gained at the risk of investment; the drive was for profits, not for letting investment go ahead. The history of low investment could not be seen more clearly than in automation and computerisation. In 1997, not one branch of the Post Office was computerised; two years later, a Labour Government had invested £450 million and connected all sub-post offices—[Interruption.] Yes, I am addressing the very issue raised by the hon. Member for Bridgwater (Mr. Liddell-Grainger).

Mr. David Heath (Somerton and Frome) rose

Nigel Griffiths: I shall give way one last time.

Mr. Heath: One initiative that is supposed to be taking place at the moment is the introduction of automated telling machines in sub-post offices. Is the Minister aware that when an ATM is put in a sub-post office, not only do customers pay a premium on every withdrawal, but the sub-post master as to put his own money into the machines to provide the service? Does the Minister think that that is right?

Nigel Griffiths: The programme has been warmly welcomed by the National Federation of Sub-Postmasters, and we are grateful for all its support. We are also grateful for the extension that the NFSP has proposed to the computerisation; the hon. Member for Eastbourne (Mr. Waterson) referred to that, having seen it in Portcullis House. The extension will involve 260 post offices in pilot areas participating in a programme in which Government information is immediately accessible to people via the computerised network.

David Taylor rose

Nigel Griffiths: I am afraid that my hon. Friend came to this debate rather late; I am sure that he will find in Hansard that his point was covered.

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We welcome the support that we have had from the NFSP and its positive proposals. We are wary of the criticisms made by Opposition Members, which have been condemned by the NFSP. We now aim to ensure that the unforgivable attack by the Opposition on another valuable service does not ring true with the general public, especially as that attack came from people who starved the Post Office of investment, presided over record closures and unprecedented bad relations with staff. Today, the Conservatives advocate special charges for people who want their mail on time. Why should we be surprised, when their record was one of chronic underinvestment every step of the way in schools, hospitals and now in our postal services?

We have heard today how the Conservatives dithered over the request from Post Office managers and trade unions for greater commercial freedom. They spent £1.5 million on consultants and, five years later, they did precisely nothing.

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