§ 11. Mr. Gowerasked the Postmaster-General what arrangements he is making for a comprehensive review of the General Post Office administration, with a view 394 to increasing efficiency and with the object of lessening the need for future increases in charges.
§ Mr. MarplesAs I told the House last week, the need to increase charges has been almost entirely due to increased wages. It would be unrealistic to suppose that wage movements of the magnitude that have recently taken place could be wholly offset by greater efficiency. Nevertheless, the Post Office has a good record in this respect; and efficiency has helped to avoid passing on to the public 25 per cent. of the increased costs of the last few years. The Post Office is subject to constant inquiry and stimulation as the only great nationalised industry directly answerable to the House, and I am not convinced that some special review would improve matters.
§ Mr. GowerNevertheless, will my right hon. Friend agree that any service which enjoys a complete monopoly and the privileges of a monopoly has a particularly high duty to examine its organisation very carefully? To that extent, even if he feels that such a comprehensive review as has been suggested is inopportune at the moment, can he say whether something will be done to ensure that an impartial and outside opinion can be obtained on the present organisation?
§ Mr. MarplesI agree that if a monopoly is in existence it is its duty constantly to examine its methods. Last year we had the services of a firm of industrial consultants, who made a report. In the last two months I have brought in one of the largest firms of chartered accountants to go through the accounts. We always welcome advice from outside.
§ Mr. Ness EdwardsWill the Minister avoid having the kind of review which we had in 1955 as a result of which the Post Office has to pay £17½ million to the Treasury, which in part is responsible for the size of the increase in charges which the right hon. Gentleman had to make last week?
§ Mr. MarplesThe right hon. Gentleman's knowledge of arithmetic is like that of the waiter on the Continent—faulty and seldom in favour of the Government. The Post Office does not pay £17½ million to the Treasury. It pays to the Treasury in lieu of taxation £5 million a year, which it never recovers. 395 When the Labour Party was in power it paid £15 million a year.
§ Mr. Ness EdwardsThe right hon. Gentleman should not allow slickness to cover up the truth. Is it not a fact that by the terms of the White Paper an additional £12½ million has to be provided, which is a cost on the Post Office? Is not that additional to the cost in the previous years, does not that make £17½ million, and does not that go to the Treasury?
§ Mr. MarplesThe right hon. Gentleman has always been muddled on this point. There are two separate transactions which the Post Office has with the Treasury. The first is the payment of a lump sum of £5 million a year in lieu of taxation, compared with £15 million in cash which the right hon. Gentleman paid when he was Postmaster-General. The second relationship with the Treasury is that the Post Office uses the Treasury as its banker in the same way as a private company uses an ordinary joint stock bank. That money which is deposited with the Treasury can be withdrawn by the Post Office on demand and without Treasury consent, and a rate of interest is paid on it. It is not a once-for-all payment. It is not "for keeps". The right hon. Gentleman has never understood that point.
§ Mr. Ness EdwardsThe right hon. Gentleman cannot get away with making round statements. The fact is that the £15 million paid in the previous method of accounting——
§ Sir P. AgnewOn a point of order. I thought I heard the right hon. Gentleman say "the fact is …" I thought he was giving information to the House instead of asking a question.
§ Mr. SpeakerI think the right hon. Gentleman was asking the Minister if he was aware of something, but I think that we have got a long way from the Question before us, and I hope this will cease soon.
§ Mr. Ness EdwardsIs it not a fact that the form of accounts was changed last year, and are they not embodied in the accounts for which the right hon. Gentleman is now responsible? Do not they provide for an additional £12½ million which was never paid before, plus 396 £5 million, which means that £17½ million goes to the Treasury?
§ Mr. MarplesThe right hon. Gentleman has got it all wrong. If he would like to see the principal of the firm of chartered accountants which we have brought in, I should be glad to arrange an interview with him. Quite honestly, I think he has got this point wrong, and that he always has had it wrong. The system of accounts approved by the House in November, 1955, is now being adhered to.
§ Mr. SpeakerOrder. I hope this will not be prolonged too far, because we are very far away from the Question.
§ 13. Mr. Liptonasked the Postmaster-General what estimated additional income will now be required to balance the expenditure of his Department.
§ Mr. MarplesI would refer the hon. Member to my statement of 18th July.
§ Mr. LiptonIs the right hon. Gentleman aware that I saw that statement? Is he sure of the figures in the statement? Did not he suggest that he wants another £42 million, and is not that overstating the situation, because he also admitted in the same statement that he will finish up in eighteen months' time with a surplus of £5 million? Why should the public be soaked to the extent of £5 million in eighteen months, incorporated in this increase which he announced last week?
§ Mr. MarplesI did not say that I wanted £42 million. I said that the Post Office needed £63 million for the three years to March, 1959, and that, in the eighteen months that remain available, that represented £42 million a year.
§ 20. Captain Pilkingtonasked the Postmaster-General whether, in the interests of greater simplicity and efficiency, he will raise the new postal charges in such a way that, while continuing to raise the overall sum which he requires, he will abolish halfpenny charges.
§ Mr. MarplesI appreciate my hon. Friend's point, and can assure him that it is well in mind. But fortunately our charges are still so low that halfpennies remain significant, and I do not believe that the public would welcome the arbitrary adjustments which would follow from confining ourselves rigidly to whole pennies.
§ Captain PilkingtonWould my right hon. Friend agree that the value of a halfpenny is very much less than it was, due mainly to six years of war and six years of Socialism? Will be reconsider this matter within a reasonable time?
§ Mr. MarplesIt is difficult, because so many of the post office charges take into account halfpennies. For instance, the charge for inland literature for the blind, which has not been changed, is from a halfpenny to 2½d. by stages of a halfpenny. To increase it for revenue would be wrong, and to increase it for the sake of tidiness, I think would be out of the question.
§ 23. Mr. Ness Edwardsasked the Postmaster-General what change has been made in his estimate of the commercial account surplus as a result of the proposed changes in Post Office charges.
§ Mr. MarplesThe effect has been to convert a prospective deficit of £58 million for the three years ending 31st March, 1959, taken together, to a surplus of £5 million. I will add a summary table for the three-year period 1956–59 in the OFFICIAL REPORT.
§ Mr. Ness EdwardsWhat I really want is the answer to a very simple question—what is the commercial surplus for which the Postmaster-General has budgeted this year?
§ Mr. MarplesIf the right hon. Gentleman will look at the table he will see the totals laid down, but the accumulated surplus for a three-year period is £5 million, which amounts to less than half of one per cent. of the turnover in the period.
§ Mr. Ness EdwardsThe Postmaster-General says that he is circulating the information, but I have asked a very simple question. What is the commercial surplus for which he has budgeted this year?
§ Mr. MarplesI have taken the three years together—[HON. MEMBERS: "Oh."]—It is all that I can do——
§ Mr. Ness EdwardsWhy?
§ Mr. MarplesI will tell the right hon. Gentleman why. It is all that I can do, because these wage awards have been made retrospectively and we have to make payments back to July, 1956. The 398 figures for the three-year budget are as follows: £6.3 million loss in 1956–57; £1.1 million profit in 1957–58, and £10.2 million profit in 1958–59.
§ Following is the table:
| — | Deficit (-)before tariff increases | Surplus (+)or Deficit (-)after tariff increases | |
| £m. | £m. | ||
| 1956–57 | … | -6.3 | -6.3 |
| 1957–58 | … | -20.7 | +1.1 |
| 1958–59 | … | -30.7 | +10.2 |
| Cumulative total | -57.7 | +5.0 |
§ 24. Mr. Ness Edwardsasked the Postmaster-General what sum has been provided for in fixing the proposed changes in Post Office charges, for depreciation over and above the normal historical basic depreciation for the current year.
§ Mr. MarplesThe sum of £18 million.
§ Mr. Ness EdwardsI understand that the sum now is £80 million—or is it £18 million?
§ Mr. MarplesIt is £18 million.
§ Mr. Ness EdwardsDo I understand that that is over and above the £29 million put down for historical depreciation?
§ Mr. MarplesThe amount for historical depreciation is not £29 million, but £33.9 million, and the supplementary is £18 million, making £51.9 million altogether, which is to replace assets at current costs as agreed in the White Paper of 1955.
§ Mr. Ness EdwardsIs not it a fact, then, that if the pre-1955 method were being used, the commercial surplus this year would be £22½ million?
§ Mr. MarplesIt is not sensible to allow depreciation on historical costs, because one cannot then replace assets when they have to be replaced. If the right hon. Gentleman is advocating that a nationalised industry should not budget for current costs, all I have to refer to is his 399 own pamphlet on public enterprise in which he says that national industries, such as electricity and coal, should generate more of their own capital.