Select Committee on Trade and Industry Minutes of Evidence

Examination of Witnesses (Questions 80 - 99)



  80. I have a current case which I will not bore you with, but you may have guessed my interest in this was somewhat detailed. I have had previous cases and in my constituency people often do not believe the consultation process is genuine, firstly because a deal is arranged already and, secondly, you consult on one specific proposal. You present it to people with virtually no choice. Now some would argue—you might like to comment on this—that is not proper consultation, it is about seeking to retrospectively endorse the decision you have made already.
  (Mr Roberts) I think we have to be clear what we are consulting about. You are quite right, we are not consulting about the decision. We are not consulting about moving a post office from A to B, we are normally consulting about the implication of that. We are not saying to people "Look, do you like this" because I think if we did we would always get the answer no and that is irrespective of the merits. It is the fact that people normally have got used to a post office in a particular place. All the experience we have had—and Mr Hoyle is looking slightly dismissive—is that when you say to people in the abstract "Can we move your post office from A to B" the answer will be no. It is familiarity and other things. We would never change the network at all if we do that. What we do is that we do, as you say, get a proposal together. We consult about whether people feel that we are worsening the service, whether there are factors that we have not finally thought of in deciding if we want to move it from place A to place B and into whatever the company is, and we normally research it afterwards to get people's reaction to it. Certainly my experience over a large number of years, almost inevitably, is I do not think I can think of one where people have started off by saying "Oh, we think this is a good idea". I can think of many where the research has shown afterwards that once people have got used to that change they have said it is longer opening hours, it is more convenient or whatever. I think we have always made the point in discussions with the consumer body, and I think they have accepted, that we are not consulting about the decision to move from A to B as long as we are not worsening the service to people in that area. We may be moving it from one spot to another but as long as we are not worsening the service.


  81. It is not really consultation.
  (Mr Roberts) It is a consultation about the services that you are getting, about the opening hours, about the position, all those things, but not about the deal otherwise you would never do anything. I do not think that we have ever, throughout the whole of this process—and we have probably franchised a thousand Crown offices - said that the consultation process is about whether we do it or not, it is about all the issues that come out of that.

Mr Berry

  82. You will make a decision, perhaps, to close down a Crown post office—
  (Mr Roberts) No, we will make a decision to move a Crown post office.

  83. You will make a decision—forgive me—to move a Crown post office, to move the service from an existing Crown post office to, for example, the local Co-op.
  (Mr Roberts) Yes.

  84. There will be no statements in advance of that, this is typically what happens, it is what happens at the moment. No statement whatever from Consignia. You are then saying to me that once you have made the decision to transfer the service you then go out to consult. So you say to the general public who have got an interest in access to their post office services "We are not consulting about this decision, that decision has been made. There is nothing whatever you can say which will influence us on this decision. All we are prepared to talk about is a few bits and pieces of detail about the manner in which we move your Crown post office service from this building to the Co-op".
  (Mr Roberts) No, you characterise it, I think—

  85. The record will demonstrate how you described it earlier, Mr Roberts.
  (Mr Roberts) Yes.

  86. You are seriously saying the consultation is not about the decision?
  (Mr Roberts) Yes, I am seriously saying that. That has been the case for as long as we have been doing this.

  87. That is consistent with previous experience of mine. I thought that was an extraordinary situation. What other public service will not consult?
  (Mr Roberts) This is the whole point, is it not, you have got it in one. Are we a public service or are we a company owned by one shareholder who is due to produce commercial returns? If I was a bank I would not even consult you at all. The issue for me, Chairman, and for this Committee and for the model under which this organisation is going to work in the years that come, is precisely what Mr Berry has just said. This organisation when I joined it was seen as a social service and many people, I know, would like to go back to those days.

  88. No, I said public service, not social service.
  (Mr Roberts) All right, public service. We are now being asked to operate commercially and the PIU Study, which was sponsored by the Government, made that very clear. They have made a distinction between those elements of the network which in their view, the Government's view, they wish to retain for social purposes, and I use the word properly this time, and those which they believe we should try and run commercially. In my view, this network would only justify something like 9,000 post offices instead of the 17,600 that we have got if it were being run commercially and making a profit. Therefore, as far as I am concerned, we are trying to run one part of it commercially and there is another part, which both Postwatch and Postcomm are involved in trying to define more clearly, where the Government wishes it to remain open because of the social value and the social service that it gives to the rest of the country. That may be the wrong approach, it may be an approach that the Committee is not happy with, but it is the approach that we are being very clearly told that we should operate.

  89. A final question on this. Can I assume that whenever you have a proposal to transfer post office services from a Crown post office that you will be making it perfectly clear in the future to people that the consultation exercise that you then embark upon is in no way, shape or form an exercise that can influence the decision you have already made? I was involved in one exercise not very long ago where that was not only not made clear but the obfuscation had to be seen to be believed. Are you going to stand up now and say henceforth these are consultation exercises that could not in any way influence your decision?
  (Mr Roberts) I am very happy to do everything we can to make it absolutely clear how we are consulting, I think that is a perfectly legitimate request to make, and if we are not laying out clearly at the start what we are doing then we will take that away and look at it. I think that is entirely a fair point to make.


  90. In your previous incarnation as a public/social service, when you conducted these consultations did you ever reverse a decision?
  (Mr Roberts) I think we did.

Mr Berry

  91. Yes, you did.
  (Mr Roberts) I think we did, but not very many.


  92. So you are not really changing anything by becoming a mean minded, hard nosed private company with a single public shareholder?
  (Mr Roberts) No, as I was saying—

  93. Plus "a change.
  (Mr Roberts) In terms of the 1,000 post offices that we have franchised and converted, Chairman, you are absolutely right, we have used the same approach through the whole of that period.

Mr Berry

  94. Maybe we ought to go into correspondence. The process has not been the same precisely because, again, in my constituency you did reverse a decision when the public made a great hoo-ha about the fact that the building you were transferring from was very accessible and the building to which you proposed to transfer was totally inaccessible.
  (Mr Roberts) That is exactly the kind of point that we do consult on. You were saying before we consult on the peripherals but the things like access, service hours and everything else are the things that we consult on.

  95. So you do a deal with the Co-op or Sainsbury's or whatever and you say you are going to transfer, but you do not look at access and so on at that stage, then you go out to consultation and if the public points out that the new provision may be totally inaccessible you say "Oh, crikey, perhaps we should not have entered into this agreement, we will tear it up"?
  (Mr Roberts) No.

  96. I genuinely do not understand, I am not being difficult. On the one hand this afternoon I have been told that the consultation is not about the original decision and then when I give an example where a decision has been changed as a result of consultation, I am told "Yes, we can change our decision if customers point out issues like inappropriate access and so on and so forth".
  (Mr Roberts) Mr Berry, you are putting words into my mouth.

  97. I am genuinely confused.
  (Mr Roberts) What I said in answer to the Chairman when he asked do we reverse those decisions, I said very often and you said we have one, and we may well have done, but it is unusual. Off the top of my head I cannot, and I suppose you cannot either, think of the details of that case but, again, in this process normally we would not do that, we would have covered all these things. But if something emerged that we had not for some reason or other picked up then the consultation process may have raised that and as a result of that we may have changed our minds, but not very often because that is not the aim of the consultation process. It is Catch-22, is it not? If I said you to that we never change our minds then you would have said "what if you find X, Y or Z, do you automatically not change your mind?" There has got to be some element around the edge where you look at the whole thing, but not very often because we do try to work it through properly before we do the consultation.

  Chairman: We are rather cynical about these matters, not just with the Post Office but with all kinds of bodies. If they actually behave reasonably at any time we use that as a precedent to batter them over the heads and they very quickly learn never to be reasonable. Maybe I am just being cynical but 20-odd years in this job has taught me that.

Mr Djanogly

  98. If I could just expand on the scope of Mr Berry's last question in relation to services provided to rural sub post offices. I have had four close in my own constituency in as many months and I know the average over the last few years has been about 350 closing, last year it expanded to about 450.
  (Mr Roberts) 550, yes.

  99. 550, excuse me. I actually wrote to Consignia and asked for the pack that I would receive if I was a prospective sub postmaster and the pack took six weeks to arrive. Is that the sort of service that prospective sub postmasters get normally? I also hear a lot of reports that the advertising for them is done very poorly and all sorts of related complaints. Is it the fact that this service, as many people are now saying, is facing meltdown?
  (Mr Roberts) The level of closures this year has slowed down. In the first six months of the year there were about 150 net number. In other words, there were openings and closings but net the number is about 150 down, which was slower than last year. The biggest issue is confidence amongst sub postmasters. I think the biggest issue facing them is ever since a decision was taken to move away from the old form of benefit payments to automated credit transfer, which is due to come in in 2003, there is no doubt that not only the confidence of existing sub postmasters but the market for sub post offices has declined very rapidly. Not only is it difficult for people in some cases to get out of running a sub post office if they want to but when they do get out it is even more difficult to find people to take them on. I do not think it is facing meltdown because it is slowing down but some of the work that has been happening on banking services and a lot of the work that is being done internally with the Federation of Sub Postmasters to reassure sub postmasters that there is a future is starting to have an impact. There is no doubt that the uncertainty that that decision inevitably caused had a big impact on particularly rural post offices where something like 30 per cent of their income comes from benefit payments.

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