HC Deb 13 July 1936 vol 314 cc1651-4

asked the Postmaster-General whether he proposes to make any further concessions to users of the telephone service?


Perhaps I may answer this question and another question later. I have an important statement to make, and it is long.


asked the Postmaster-General whether he is yet in a position to make any further reductions in telephone rentals?


I will make a statement at the end of Questions.

At the end of Questions


Since October, 1934, when a series of reductions in telephone charges was inaugurated, the growth of the system has been remarkable and the annual increase in telephones is now about double that of the years preceding the reduction of rates. This growth has been accompanied by very satisfactory increases in revenue and, with a view to bringing telephone service within the reach of a still wider circle of the community, and of increasing its usefulness and cheapness to those who already have it, I propose, with the concurrence of my right hon. Friend the Chancellor of the Exchequer to introduce further concessions.

From 1st October next every subscriber on a quarterly basis under the ordinary residential rates for exclusive lines will be able to make 200 penny local calls a year free of charge. This free allowance will be applied to the first 50 local call units in each quarter, the units being 1d. each. Similarly, the first 16 local call units in each month will be given free to ordinary monthly residential subscribers. In a large number of cases this will mean that the telephone rental of £1 a quarter will cover all nominal charges for the service, and a small residential user in all but the largest cities will thus be able to obtain what is, in effect, an inclusive service at a figure closely approximating to 1s. 6d. a week; at the same time all ordinary residential subscribers will secure a benefit up to 4s. 2d. a quarter.

It is, of course, with the small user that the chief potentialities of development lie, as we have found from the success of the business small user tariff among small shop-keepers and one-man businesses. The concession of free calls is not so suitable to this service which is largely used for incoming calls. I propose, therefore, to make a flat reduction in the business small user tariff of 10s. a year and a similar reduction will be applicable to all ordinary business lines.

In the case of those businesses which rent additional lines to the same premises, the rental for each of these auxiliary lines will also be reduced by a further 10s. a year. There will be consequential reductions in associated services. In January next I also propose to make certain reductions in the charges for private lines up to 24 miles, with corresponding reductions in respect of the first 24 miles of longer circuits.

These concessions, taken in conjunction with the reduced charges for extension telephones introduced last January and the further reductions in trunk charges which came into force in May, represent a very considerable all-round cheapening of telephone services, affecting all classes of telephone users. In fact, the reductions made during the present year are estimated to involve the sacrifice of revenue, after allowing for additional business induced by the lower tariffs, to a total amount of one and a-half million pounds in the first full year, but I feel confident that this sacrifice will be amply repaid by the further assistance it will afford to trade and in facilitating business and social communications throughout the country.


Arising out of that extremely satisfactory statement of the Minister, is it not a fact that the reduction in rates has very much increased the use of the telephone, and is he not hopeful that, in view of the further reduction of rates, especially to business houses, the telephone charges can be again reduced and so be of further assistance to the business community?


I do not think I could undertake to promise any further reduction since the statement I have just made, but it is a fact that there has been a great increase in the use of the telephone. We hope by this announcement to-day to add to the number of telephone subscribers, and I am glad to be able to assure the House that this policy has led to a great increase of employment in the Post Office.


Is the right hon. and gallant Gentleman aware that for some time past a connecting-on charge of 15s. has been made to new subscribers in the Metropolitan area, at any rate, whereas previously no connecting-on charge, but a deposit of £1 for calls, was made, and will he consider the advisability of removing that charge?


If the hon. Member will put that question down, I shall be happy to go into it.


Does the right hon. and gallant Gentleman not think that this is one of the big advantages of having it under State control?


I have not a very happy recollection of the management of the country some little time ago by the hon. Member's party.