POST OFFICE CHARGES AND SERVICES

HC Deb 21 April 1970 vol 800 cc258-372

4.2 p.m.

Mr. Paul Bryan (Howden)

I beg to move, That this House deplores the steep rise in telephone charges which will cause widespread hardship and further increase industrial costs, and regrets the deterioration of Post Office services and the prospect of higher postal charges. The Minister of Posts and Telecommunications has by now established a consistent record of subterfuge in the methods that he has adopted in bringing bad news either to the House in particular or to the public at large. The last rise in postal charges was launched and meant to be lost in the confusion surrounding the introduction of the two-tier post. The plans for the B.B.C. in the 'seventies, which predictably caused subsequent uproar, were introduced just after the House had risen for the Summer Recess, even though we had had a debate here a few days before. Last November, the right hon. Gentleman tried to announce a major development in broadcasting policy in the form of a Written Answer to a planted Question, until the House insisted on his making a statement and submitting to questioning the next day.

The right hon. Gentleman's announcement of these latest monumental rises in telephone charges has followed precedent. First, the House was treated to a vague statement about the new profit target for the Post Office, and, in particular, for telecommunications, which were to go up by l½ per cent. Those of us who keep abreast of Post Office matters smelled a rat, but most hon. Members, and certainly the general public, had no idea of what was to come once the House was safely in recess. Then, of course, the statement came out which the Minister had not dared to put straight to the House—that telephone charges would go up in June by about 20 per cent. In particular, the connection charge, which only 18 months before was doubled, is now to go up another 25 per cent. Residential rentals, which went up from £14 to £16, are now to go up another £4, and business rental will go up by £8, or 50 per cent.

I should like to deal with the last six words of th Motion, " the prospect of higher postal charges ". As, on past form, the public will get little warning from the Minister, may I give a clear warning now that, either during the Whitsun or Summer Recess, an announcement will be made that letter post is to go up by 2d. per letter, that is, to 7d. for first-class and 6d. for the second-class mail. The rise will be timed to come after the General Election. This may not be the end of the story. Following decimalisation, 7d. will no doubt be equated to 3np, which will equal an increase to 7.2d. per letter.

My forecast is based on the facts. The loss on the postal services in 1969–70 is estimated at £26 million, and this does not take into account a full year of extra wages, which have risen since the last report and accounts of the postal services by £41 million. Wages comprise 74 per cent, of all postal costs. Most other costs will have risen and postal services must be heading for a loss of about £50 million.

I also read in The Times today that decimalisation will cost a further £10 million. Paragraph 177 of the last Prices and Incomes Board Report says that a penny on the letter rate brings in roughly £25 million. So even the increase which I forecast will not cover costs, so far as I can see.

I do not expect the Minister to confirm or deny my prophecies of future postal charges today. But to help us to make our own calculations, we have a right to ask him this question: how much are the postal services currently losing every week? By his answer, we can at least judge the extent to which the Post Office will have got into debt when the Conservative Government assume office.

All this is a repeat of the B.B.C. licence trick. The B.B.C. has been frankly told that it can get into debt until after the election and that the debt will then be redeemed by a rise in the licence fee, to be imposed in April, 1971. The formidable scale of these increases in post and telephone charges, particularly following so closely on previous increases, demands an explanation. It is, of course, outrageous that we are having to wring an explanation out of the Government by means of a Supply day debate.

Whatever we may think of the tariff itself, I stress that our most serious complaint is the lack of any detailed statement of how the increases are justified. An increase in postal charges used to be a rare and considerable event. On the last occasion, we were able to look back and say that there had been only two major increases in the previous 20 years. Now, there are to be two increases in two years. Huge and unprecedented sums, such as the £2,700 million telecommunications investment programme, are bandied about, but no detail, no breakdown, is given; there is no White Paper on which to base our discussions.

I therefore ask the Minister, first, why these changes in tariff have not been submitted to the Prices and Incomes Board. The decision to refer all major increases in the nationalised industries to the board was made in September, 1967, and the last Post Office proposals for an increase were duly submitted. The public at least had the benefit of a full, explanatory report. A State monopoly, with its power to impose prices at will, has an obligation to submit itself to an efficiency audit of this sort.

Despite the short interval we are to have larger increases, but no report, and I can guess why. Having stressed the importance of stable tariffs and the necessity for long notice of any changes, the 1968 report makes the following statement, in paragraph 202: To the best of our judgment the increases which we have recommended should be adequate until further changes become inevitable on the introduction of the decimal currency in 1971. On the telephone service, we hope that the changes will then on balance be downwards, but on the postal services it seems probably that some further increases will be required. So this expert body actually expected telephone charges to go down in a year from now. I think that the business world and the public in general had a right to treat this as the best available guidance. No wonder they are flabbergasted at the rise which they are now asked to face.

What has gone wrong? The report was published only two years ago, in 1968, and the Minister surely cannnot tell us that the changing of the profit target from 8½ per cent. to 10 per cent. is the total explanation. Is not the explanation more connected with the erratic under-forecasting by both the Minister and the Post Office of its capital requirements? During the Committee stage of the Post Office Bill, just over a year ago, the Minister gave the figure of £1,765 million as the capital needs for telecommunications over the next five years.

Lord Hall, at a Press conference on 3rd February last, said that " currently the programme is £2,500 million and getting bigger ". He was certainly right, for within a couple of months the figure had leapt to £2,700 million according to the Blue Book published on 4th April. So the total appears to have rocketed by £1,000 million during the last year. What is happening? Has the Post Office lost control of its budgeting? It is essential that the Minister gives the House a detailed breakdown of its capital plan item by item, because it is a mystery as it now stands, and in particular, its explanation of why the forecast is constantly out of date and consequently valueless.

What does Lord Hall mean when he says, " The programme is going up all the time "? By how much and exactly why and exactly how will this take place? We are not dealing with a new phenomenon like a space programme, in which there are so many unknowns that an accurate forecast is more or less impossible. What is the policy on self-financing, on which the tariff level so largely depends? When the Government took over, the ratio was 57 per cent., and in 1968–69 it has gone down to 40 per cent. It is now to be 54 per cent.

These are questions which concern industry. A firm like British-Leyland, which spends £1 million a year on telecommunications wants to know whether this particular item of its costs is to advance 20 per cent. every other year. When dealing with the effect on industry, perhaps the Minister would explain why, in rentals, the differential between business and residential subscribers, which was abolished during the course of the last tarriff increases, with the approval of the P.I.B., has now been restored. This presumably cannot reflect true costs.

This leads me to ask the Minister to what extent do the particulars of the new tariff reflect true costs? The Post Office is now the biggest spender of all the nationalised industries. Since we are today getting a taste of the cost to the taxpayer of raising its capital, it is surely a time for the Minister to take heed of the advice which we constantly gave him in Committee last year—to look for other sources of capital. Our telephone system is bound by rigid monopoly rules which insist that practically all equipment attached to its wire must be provided, and, therefore, financed, by the Post Office. There is no need whatever for this.

I have recently been to America. Following the Carterfone decision, the courts there ruled that private exchanges and a very wide variety of other equipment attached to the telephone system can be supplied and maintained by private firms. This is an opportunity of capital saving which the Government ignore for purely doctrinal reasons.

I see that the national data processing service is to require about £40 million over the next five years. Is this necessarily the right place for public capital? Again, in America the A.T.T. & T., which has the monopoly on the line is specifically prohibited from going into the computer bureau business. No business should put up its prices without undergoing a thorough economy drive throughout the whole organisation. I am sure that before the public pay these enormously increased charges they will want to know what economy the Post Office has made.

For example, is advertising on the present scale necessary? I understand that advertising now in posts and telecommunications alone has gone up to £1½ million. What evidence has the Minister that this is producing effective results? What is the position for public relations staff? When the Government first took office P.R.O.s multiplied in their Departments like rabbits, and the Post Office was no exception. To what extent does it still suffer from these excesses and can this class of personnel not be reduced in number?

The public will want the Minister to report on plans for increased efficiency. After such disasters as the opening weeks of the two-tier postal system and the farce of the London telephone directories, he must realise that the public simply do not accept that the Post Office is efficient. The last P.I.B. report was critical of the Post Office system of costing. Could the Minister now say whether that has been rectified? The report had a devastating chapter on the marketing organisation of the Post Office, in particular the marketing of telephone services. Has this been put right?

The Post Office, with its enormous peaks and troughs of activity, is obviously particularly suited to part-time work if the unions will allow it. To what extent is overtime to be saved by the introduction of part-time work? The House will want to know what action has been taken on the report following the strike of the overseas telegraphists last year.

I quote from an article in The Guardian, on 2nd January of this year. It says: A secret Government report on the damaging strike of 4,000 overseas telegraphists last year hits out at everybody in sight—the men, the Union of Post Office Workers and the G.P.O., as it then was—for deplorable labour relations and poor communications. Later, it says: The inquiry has found that the men's complaints of inadequate basic pay, staff shortages, excessive overtime, low promotion opportunities, and unfair exploitation of acting rank are justified. It attacks remote top management and harsh discipline, the ineffective joint consultation and secrecy over the G.P.O. change to Corporation status. Finally, it comes down heavily on deficient union representation. That is really a shattering indictment of any organisation. We have heard no report about this in the House and I think that this is also the time to hear whether that, too, has been put right.

The Minister will no doubt claim that productivity in telecommunications has risen by perhaps 8 or 10 per cent. This is very welcome. With so high a rate of investment, we expect a high rate of improvement. But it is the gaps in the efficiency picture which are more obvious to the general public and it is now time for the Minister to show that some of these have been filled.

Hon. Members have been inundated with letters. I think that everybody will agree that many of them are pathetic in the extreme, describing what the increases in the telephone charges mean in real terms to poor people, to the old, to invalids, and all who, for some reason, depend on their telephone for their contact with the outside world, either socially, or certainly in an emergency.

After the rise in prices of almost every necessity—light, heat and food—and with the postal and television licence increases still to come, these telephone increases are to many people the last straw. The Minister of State, Department of Health and Social Security, gave certain assurances the other day to my hon. Friend the Member for Birmingham, Edgbaston (Mrs. Knight) on the question of help available through the Supplementary Benefits Commission for those to whom a telephone is a necessity. I want the Minister to reassure the House not only that the help is forthcoming, but that those in need know that it is available.

Mr. Ernest Melling. Secretary of the National Federation of Old-age Pensions Associations, says that he has never heard of the scheme. Mr. Tom Parker, Secretary of the National League of Blind and Disabled, says: We have submitted case after case to the Supplementary Benefits Commission and they have all been turned down. I cannot recall one being granted. On the evidence we have so far, publicity is not what it should be and we yet lack evidence to show that the scheme is really working.

The Opposition supported, maybe with some misgiving, the general proposition that the Post Office should cease to be a Government Department. We acknowledged then that one price we should have to pay for the change to corporation status would be the loss of some degree of parliamentary accountability. How high that price might prove to be was bound to depend not so much on the wording of the Act, but on the attitude of the new managers of the Post Office and on the Minister himself. I do not think that hon. Members can complain about the service they have received from Lord Hall and his managing directors, Mr. Vieler and Mr. Fennessy. Our letters have been courteously and even more promptly answered, I would say, than before, and certainly with as much care and as much detail.

Again, it is the Minister who is letting the side down. During the very first Question Time after the establishment of the Post Office Corporation, he declined to answer eight Questions from hon. Members without so much as the courtesy of a warning that he would be doing so. With the new Post Office management now striving to win back the confidence of the public, thrown away by the Minister when he tried to salvage the early wreck of the two-tier post by misleading statements, he again underrates the people by trying to camouflage the unhideable truth that their telephone bills are going up by one-fifth. Now is the right hon. Gentleman's chance to redeem his reputation by a full and straight explanation of exactly why these increases are necessary.

4.23 p.m.

The Minister of Posts and Telecommunications (Mr. John Stonehouse)

I welcome the Opposition's choice of subject for this debate, as it gives me the opportunity of describing developments in the Post Office and explaining in more detail why the Government have decided to increase the Post Office's target for telecommunications from 8½ to 10 per cent. The debate also gives the House the chance of commenting on the Post Office's proposals for tariff changes before the Post Office Users' National Council concludes its consideration and makes its own proposals to me.

However, I utterly deplore the terms of the Motion. Instead of approaching the subject objectively and making intelligible proposals about the future of this vast public service, the Opposition have decided to try to make the Post Office a political plaything. Their Motion displays a narrow partisan approach. They choose to ignore the economic policy for the increase in charges and, although they make some congratulatory gestures towards the new Post Office Corporation, they indulge in an implied attack on a public corporation only six months after it has been set up. I conclude from this that the Opposition are very short of politically damaging subjects for Supply day debates.

Most of the interest in the debate will be on the telecommunications side and, therefore, I will deal primarily with that. This is, of course, in itself a vast industry, providing essential communication links within Britain and between Britain and the rest of the world. Post Office engineers and research workers have produced advances in technology which are helping the industry to do a more efficient job. The demand for the service has been explosive during recent years and big demands have been put on the system. I recognise that sometimes the service is inadequate, although complaints are often exaggerated, but the Post Office is anxious to improve its performance and is gradually doing so.

Where is the blame to fall if the telephone service is not 100 per cent. efficient? It should not fall on the Post Office executives and engineers who, over the years, with the resources at their disposal have built up a system which is among the best of the industrial states. Disparaging comparisons used to be made with the service in the United States, but we have heard less of that recently since the highly-publicised breakdown of service in New York City due to congestion. Nor does the most bitter critic dare to compare the British system with most systems on the Continent, where the standards of service are so much worse than anything we have ever experienced here.

If there is fault, then the blame must go to successive Governments after the war, who cut back investment programmes in the Post Office because, in times of financial stringency, that was the easy thing to do. This was particularly true of the 13 years of Conservative rule during which successive Postmasters-General were prevented by their colleagues from spending money they thought essential on developing the service.

The present Government have been determined that that error should never be made again. We have approved the biggest development programmes in the history of the Post Office and have ensured that they have not been cut back arbitrarily when the economic climate has got a little chilly. It is fair to make comparisons between the last five years of Conservative rule and the first five of ours to show the enormous change in emphasis on development investment.

Between 1959 and 1964, a total of £580 million was spent. Between 1965 and 1970, a total of £1,416 million was spent, an increase of £800 million in five years, or two and a half times as much as was spent during the previous five years. No one can accuse us of being parsimonious towards the Post Office's need for new investment. Indeed, the situation is quite the reverse.

Mr. Tom Boardman (Leicester, South-West)

Is the right hon. Gentleman referring to current or constant prices?

Mr. Stonehouse

I am referring to current expenditure. Of course, we must take account of increasing costs to get a fair comparison, but the figures are devastating. They show that we have taken the brakes off the investment programme whereas, during the years of Conservative rule the brakes were on practically all the time. We have recognised the country's need for an up-to-date communications system and have been prepared to spend money.

Judging from their past performance, if the Tories had been in office during the past five years they would not have approved such vast expenditure, the waiting list would now be enormous and the standard of service would be very bad. We have had to cope with an explosion of demand for new telephones which is quite unprecedented. In 1963–64 the annual net demand for new telephones was 566,000. Within the following two years it had risen to over 800,000 a year. an increase of 40 per cent.

This year the demand for new telephones is estimated to be 1,100,000, a further increase of 37 per cent. Incidentally, this account of the demand explosion hardly tallies with Conservative accounts of living standards under this Administration. People's standards are going up and they want the telephone installed in their homes. I receive complaints in my constituency when there is a few weeks' delay in telephones being installed. We did not have that when the Conservatives were in power, because people could not afford to have a telephone installed. Under this Govern- ment they can afford it. The demand curve proves that.

Mr. Bryan

Is the right hon. Gentleman saying that the standard of living is rising faster now than it did under the Tories?

Mr. Stonehouse

I am saying that this is proved by the facts. The growth of installations is going up. It has gone up to 26 per cent. from 4.7 million exchange lines to 6 million. From 1965 to 1970, the growth increased to 42 per cent., bringing the system's size to 8½ million exchange lines at the end of last month. This is an outstanding achievement by any yardstick. All credit is due to the Post Office and its engineers. Now plans are in hand to cater for a 100 per cent. growth over the next 10 years, bringing the system to 17 million exchange lines. Currently, 32 households out of 100 have a telephone and in 1980 at least 72 out of 100 will have telephones. Similarly, the number of actual telephones installed—this, of course, includes extension telephones—has increased from 1965 to 1970 from9.9 million to 13.9 million. In 10 years' time there will be 33 million telephones installed.

Despite the increase in demand with which the Post Office has had to cope over the last few years, the waiting list has been kept under control and 85 per cent. of all orders for telephone service are now met on demand. For those who have to go on a waiting list, the average period of waiting has been reduced from six-and-a-half months in 1968 to four months now. The waiting list is 108,000. Of these, 80,000 are held up, not by the Post Office, but through delays in the supply of exchange equipment from suppliers. The Post Office is anxious to eliminate the waiting list completely and will virtually be able to do this when manufacturers keep their delivery dates.

Hon. Members should remember that our waiting list for telephones is much less than that in most countries. In West Germany, it is 330.000; in France, 320,000; and in Japan, a country to which we are frequently compared in disparaging terms, it is 2,400,000.

As well as providing service for domestic subscribers, business subscribers have also had increased facilities given to them by the Post Office. The Post Office is one of the world's leaders in data transmission. Datel, introduced in 1965, has doubled every year since and now has 8,000 terminals in Britain. There will be 50,000 terminals by 1973, and nearly half a million in 10 years' time. There are today in Britain more terminals than in any other country, apart from the United States of America, and probably more than in the rest of Europe put together.

All this has immense significance for the efficiency of business, which depends on speedy communications. The Post Office is also pioneering Confravision, which provides a unique facility for business conferences over sound and vision links. This allows the chairman of a large company to talk in confidence with directors at plants and subsidiaries in all parts of the kingdom and even abroad without having to travel to any particular place. During the next five years the Post Office will be spending over £2.500 million on this development programme. One reason why the hon. Member for Howden (Mr. Bryan) has not been able to get absolute consistency in the figures he quoted is that the figures are being rolled on year by year.

Mr. Ted Leadbitter (The Hartlepools)

This is a remarkable account of the extent of investment. Is my right hon. Friend aware that, in Standing Committee on the Post Office Bill last year, a Conservative Member put forward an Amendment which he described as important because it would make way for denationalisation of part of the Post Office— telecommunications? The hon. Member for Howden (Mr. Bryan), who has forgotten all about it, should be reminded, in view of the investment account which my right hon. Friend has mentioned, that at the end of the debate he said this was Tory Party policy. Will he now clear that point up?

Mr. Stonehouse

There will be a lot of questions which the Opposition will be expected to clear up before the end of the debate. The very important one raised by my hon. Friend the Member for The Hartlepools (Mr. Leadbitter) is one to which they will be expected to reply.

It is all very well to say that other sources of finance should be found, as is being suggested, but does anyone suggest that it could be found at 10 per cent.? The rate of interest charged by outside investors would be appreciably more. If parts of the system were to be sold to firms, as was suggested in Standing Committee, the subscriber would have to face incomparably increased charges because they would have to meet a very much higher rate of interest than the 10 per cent. we have proposed.

Mr. Nicholas Ridley (Cirencester and Tewkesbury)

So the Post Office is getting access to cheap preferential capital, which will utterly distort distribution of resources in the country?

Mr. Stonehouse

I am grateful the hon. Member has intervened, because I shall be referring to a very important contribution which he made to our deliberations in Committee. The Post Office should be charged a fair rate for a public service. The 10 per cent. target we have fixed is, I think, a fair rate, whereas 8½ per cent., considering the vast development programme, was too low.

Mr. Stratton Mills (Belfast, North) rose —

Mr. Stonehouse

I propose not to give way again, because if I do so I shall not be able to complete my speech and to allow other hon. Members to take part in the debate.

The Post Office will be spending over £2,500 million over the next five years. We want to ensure that this programme goes ahead on a firm basis. That is why I announced the increase in the target from 8½ to 10 per cent. This will ensure that 52 per cent. of the programme will be provided from the Post Office's own resources. It would have been dangerous to have allowed the self-financing ratio to fall below 50 per cent. With the old target figure it would have fallen to 30 per cent. With such a low figure the taxpayer would be providing over two-thirds of the development finance. At that rate, and with lower tariffs, there were grave risks of the increase in demand being artificially stimulated and met by an uneconomic rate with con- sequent waste of engineering and manufacturing resources.

It is not without significance that other Administrations provide for a major part of their development finance from their own resources and not from money which they borrow from their Exchequers. Denmark, for instance, provides 85 per cent. from its own resources, Japan a like percentage, Holland 82 per cent., Norway 63 per cent., and the Bell system in the United States 62 per cent. The United Kingdom figure is now 40 per cent., and under the new target it will rise to 52 per cent. The comparisons with other countries show that we have the ratio in about the right proportion. Indeed, there could have been a case for going even higher than the 52 per cent.

This becomes even clearer when comparisons are made with the rest of British industry, where the self-financing ratio averages 85 per cent. Guest, Keen, for instance, which has just announced its results, announced a self-financing ratio of 100 per cent. for 1969. Do we hear roars of disapproval from hon. Members opposite that the consumer of the Guest, Keen products is asked to finance 100 per cent. of its development programme in that period? What contributions will the shareholders make to this? We are fixing the rate of return at 10 per cent., and that is modest by most industry standards. Shell makes 20 per cent., and it is interesting to note from today's Evening Standard that the managing director of Shell Transport, the United Kingdom end of the Anglo-Dutch-Royal Dutch Shell combine, Mr. Barran, has said that there may have to be petrol price increases to allow the industry to finance its enormous development programme. If that is right for Shell, it must be right for the Post Office.

B.P. is another example. It makes 26 per cent. I.C.I. makes 13 per cent., Courtaulds 16 per cent., Dunlop 14 per cent. and G.E.C. 19 per cent. If the rate of return in those very large companies, some of which are in a very powerful position and in conditions as competitive as those of the Post Office—some of them are quasi-monopolies in some of the fields in which they work—

Mr. Stratton Mills

Which out of the list of companies that the right hon. Gentleman has read out has a monopoly position? That is what he is comparing them with.

Mr. Stonehouse

The Post Office is not entirely in a monopoly position. It has to operate in many fields in a competitive situation. As I was going on to say, much of its investment is at risk, whereas private firms can avoid the sort of risks a public service has to undertake. The overall return which British industry makes on non-competitive contracts from the State is 14 per cent. and in the case of contracts involving no risk at all the rate is fixed at 10 per cent. All these comparisons show that the rate of return that we have fixed at 10 per cent. is fair and not excessive.

Why do the Opposition suggest that what is good for private industry is not good for public enterprise? My hon. Friend the Member for The Hartlepools has put his finger on the real reason. It is that the policy of the Conservative Party is to undermine public enterprise as far as it can and to make it vulnerable to take-over by private enterprise, so that the profits can be milked away. That is something we certainly do not intend to allow, and when we have won the next General Election we shall prevent it. It was very interesting to note acceptance of the fact that we shall win the next General Election in the speech by the hon. Member for Howden. That was a very interesting Freudian slip.

The Opposition approach is wholly inconsistent. On the one hand they attack deficiencies in the system; we have complaints from them all the time. Therefore, they presumably support the development programme, which is designed to remedy the deficiencies. But if the self-financing ratio is to be kept down, which is presumably what they suggest, because they do not agree with these tariff changes, they would have the taxpayer make it up. If the recent increases in charges were revoked, the taxpayer would have to find another £65 million.

I put the question bluntly to the Opposition: are they in favour of the development programme? If they are not, they should say so. But presumably they are. If they are, and are not in favour of the increased target, will they say clearly that they accent the increased taxation of the order of £65 million a year that would result, equivalent to l½d. on the standard rate of income tax? That is the position. If hon. Members opposite do not accept the increased charges, which flow entirely from the increased target that I have announced to finance the development programme, they are in favour of increasing taxes to finance the programme.

That is the question which I put to hon. Members opposite now. If the hon. Member for Howden wishes to intervene at this stage to make his position clear I shall give way, but if he does not we shall expect an answer before the end of the debate. If no answer is forthcoming, we expect hon. Members opposite to withdraw the Motion, which is based on such foolish grounds.

Of course, more intelligent hon. Members opposite realise that what I have been saying is true, particularly the hon. Member for Cirencester and Tewkesbury (Mr. Ridley), who made a number of very interesting contributions to the Standing Committee proceedings on the Post Office Act. On 27th February last year he said: …I believe that, on the whole, we have tended to raise too low a proportion of the new investment in the nationalised industries from consumers. Generally, the percentage of self-financing has been too low. I am disappointed to hear from the Postmaster-General that it will tend to fall rather than rise in the Post Office. He says that it is currently about 53 per cent. and that, overall, in the period ahead it will drop to 50 per cent. That seems a retrograde step. I then asked him: Does it then not follow that charges would have to be increased to improve the proportion obtained from internal resources? Is that what is being suggested?" The hon. Gentleman replied very frankly: Yes, it does follow, and it is a point which I was not avoiding. He added a little later: In the absence of an alternative yardstick, I would say that the internal proportion should tend to go up rather than to go down. In those circumstances, it should never drop below 50 per cent., otherwise the burden falling upon the taxpayer becomes intolerable."—[OFFICIAL REPORT. Standing Committee D, 27th February, 1969 c. 918.] I am sure that the hon. Gentleman will be with us in the Division Lobby if there is a Division tonight, because we are doing exactly what he recommended a year ago.

All the sensible financial journalists support what we are doing. The Financial Times of 6th March made the point that the financial target could have been questioned in any case as interest rates have risen since it was fixed, but added: More important than this point, though, is the fact that at current tariffs the proportion of investment in telecommunications financed from the Post Office's own resources would have fallen from barely half in the financial year just ended to less than a third by 1975. Quite rightly, the Government decided that more of the funds needed would have to come from revenue and less from borrowing.

Mr. David Winnick (Croydon, South)

My right hon. Friend has shown that there is no alternative to the increased charges. He has put up a very good case. But can he promise us today that with my right hon. Friend the Secretary of State for Social Services he will try to find a scheme—perhaps called a telephone rebate scheme—which will help the elderly and handicapped who do not receive supplementary benefits? Is there not a very strong case for assisting those people living on small fixed incomes who do not receive supplementary benefit?

Mr. Stonehouse

I shall certainly try to deal with this point before concluding my speech. I realise that it is important and that the House is very concerned about it.

The Post Office is well on the way to establishing the most efficient communications system in the world, and one well able to cope with the demands of the computer age. In the time available I can do no more than give a few examples of the progress being achieved.

The small electronic exchange, the so-called TXE 2, has been developed. There are now more than 30 in service, and they are being opened at the rate of one each week. With this exchange the number of failures on local calls has been reduced to one-tenth of that experienced on existing exchanges. This electronic exchange should have great export potential, and the Post Office is providing a launching pad for exports in developing it.

There are also developments and field trials going on for a large electronic exchange, the so-called TXE 4, which will be an advance on anything available elsewhere in the world. Electronic control equipment using stored programme controlled principles has been developed to replace the electric-mechanical controlled equipment. This achieves a substantial improvement in service and savings in space. The Post Office has started the world's first exchange with pulse code modulation, which provides for more intensive use of trunk lines. This exchange is handling 3,000 calls a day with great reliability.

The subscriber trunk dialling system has been expanded throughout the past five years. Some years ago all trunk calls had to be put through an exchange. That was very expensive. As a result of the development of STD, assuming that the same calls are being made by the new system as the old, subscribers have saved about £250 million. In 1964 2.9 million subscribers had access to STD. Now 7.2 million subscribers have STD, and by 1973 all subcribers will have it, so giving them a cheap means of dialling trunk calls.

International subscriber dialling is also of immense assistance, particularly to business, in achieving efficiency and economy in communications with the rest of the world. It is now possible to dial 21 countries in Europe, and from exchanges in the metropolis we can dial New York on I.S.D. at 10s. a minute. In 1927 it cost £5 a minute to telephone New York. In the past 12 months I.S.D. was introduced to 16 more countries.

The Post Office's part in international communications has been immensely important, and we can be proud that it is the second largest shareholder in Intelsat, after the U.S.A.

What we must remember—and this is what the Opposition deliberately ignore —is that not only are we providing better communications with the rest of the world but we are often providing them more cheaply than was the case tens of years ago, and currently more cheaply than elsewhere in the world. For instance, the charges for intercontinental telephone and telex calls from the United Kingdom are 20 to 33 per cent. lower than the corresponding charges for calls originating elsewhere in Europe.

The Opposition Motion is not based on fact. It is clear that, far from our allowing a deterioration of the service, it is vastly improving, for both domestic and business subscribers. It is clear that more people are requiring telephones more quickly than before. It is clear that many charges, such as for S.T.D. trunk calls and international calls, have been drastically reduced with the advances in technology. It is clear that the Post Office has a realistic development programme for the future. We believe that it must be allowed to pay for the major part of the development programme from its own resources. Hence the change in the target and the consequent tariff changes.

May I make it clear that those tariff changes are the responsibility of the Post Office and it would certainly not have been appropriate for me to have given them to the House when I made the announcement of the change in target rate. Even now they have not been fixed, because they are subject to consideration by the P.O.U.N.C. Even with the proposed increases we shall have one of the cheapest telephone services in the world.

I have the international comparison before me, and it shows that, compared with other industrial states, 11 are more expensive than us for domestic subscribers on comparative lines, and only four are less expensive. Taking an annual cost of £30 is. 0d. to a domestic subscriber, the subscriber in France would have to pay £48 18s. 8d. for the same service and in Japan £44 19s. 0d. Post Office efficiency is proved by this sort of comparison.

Hon. Members may have seen an article in the Sunday Times in March by Mr. Timothy Johnson, the Industrial Correspondent, who made this point, worthy of quotation: Already Europe tends to look to Britain for leadership in the introduction of such things as electronic exchanges and a network specially adapted for computer communications. The Americans are bedevilled by a political and commercial civil war and are currently much more pessimistic than the Post Office over the space of change that will be possible. By 1980 Britain could have the most advanced communications network in the world —with all that that implies for exports and internal growth.…The one thing outside its control which could hold the Post Office back it the amount of money it is allowed to invest. If the country wants a good communications system it must be prepared to pay for it, and to keep on paying without the sudden cut-backs which have been so damaging before. In return the Post Office has got to foresee what people are going to want 5, 10 or 20 years ahead and lead the way there, rather than following increduously in the wake of public demand, as it has tended to do in the past. These are fair comments from an independent witness, showing how dangerous it would be if the Conservative Administration were to return to cut-back on the development programme.

Turning to the postal side, it is beyond doubt that the Post Office is maintaining a very high standard of service. Some of the attacks recently upon it have clearly been politically inspired. For instance, we have Aims of Industry, which produced a very expensive brochure and sent it out to all M.P.s, getting a lot of publicity. This was politically motivated, coming as it did from a Tory front organisation.

The Post Office took it up and Mr. Geoffrey Vieler the Director of Posts wrote to the Director of Aims of Industry and said: The results are so far out of line with our own performance figures that we invite you to supply the names and addresses of the 11 firms with the poorest results. Of those firms four could not be identified but the remaining seven were investigated with the agreement of the firms. The results are very interesting. Dealing with first-class mail, Aims of Industry showed that the percentage of next day deliveries was as follows: 89.1 per cent.; 90 per cent.; 75.7 per cent.; 63.4 per cent.; 79.7 per cent.; 75 per cent.; 88.3 per cent.

Mr. Stratton Mills

On a point of order, Mr. Deputy Speaker. The Minister has quoted in part from a letter by Mr. Vieler to Aims of Industry. Does this come under the rule of order of the House dealing with the head of a nationalised corporation—

Mr. John Mendelson (Penistone)

Is the hon. Member afraid?

Mr. Stratton Mills

—which requires the full letter to be made available to hon. Members, as it would be if it were a quotation from a letter which a Minister had written?

Mr. Deputy Speaker (Mr. Harry Gourlay)

Order. The right hon. Gentleman is within the rules of order in quoting as he has.

Mr. Stratton Mills

On a point of order. I fear that I have not made myself clear. I am not challenging the right of the Minister to quote the letter. What I am asking is whether in the circumstances it does not fall under the rule of order of the House which requires the Minister to publish the full letter?

Mr. Deputy Speaker

Order. The Minister is not obliged under the rules of the House to lay the letter on the Table, which I think the hon. Member is suggesting.

Mr. Stonehouse

To make it clear that I am not running away with anything I would be pleased to supply the full text of the letter to any hon. Gentleman who would like to see it.

As a result of the joint examination—and I appreciate the anxiety of the hon. Member in trying to curb these facts—the following results were produced for next day deliveries: 96.7 per cent.; 90 per cent.; 96.8 per cent.; 100 per cent., which compares with 63.4 per cent. given by Aims of Industry; 91 per cent.; 94.6 per cent.; 98.2 per cent. All were appreciably higher than was stated by Aims of Industry. In only one case did the joint examination tally with the original survey.

As Mr. Vieler said: The results of our examination, which have been agreed by the firms, are broadly in line with our performance statistics which are based on returns taken all through Britain and are statistically valid to within plus or minus I per cent. and present a very different picture from the one put forward in your report…We are far from complacent about the postal service. With an organisation as big as ours, which handles over 35 million items a day, three or four times each, there are bound to be some mistakes. We are doing our utmost to reduce these failures in service but our efforts to improve service to our customers and the morale of our postmen are not helped by the kind of picture you present. I hope that Opposition speakers during the course of the debate will take the opportunity to dissociate themselves from this politically-inspired and destructive report.

The stories in the Press about postal increases are pure speculation. What is true is that the Post Office has put proposals to me which I have discussed with it on various occasions. Its proposals have been amended from time to time and are still under consideration. The two most important factors to be taken into account in considering these proposals are, first, wage awards which on the postal side amount to £26 million, in a full year, and, second, productivity improvements and the abolition of restrictive practices with a change in service arrangements which can maximise increasing productivity.

Both these factors have to be considered. I am anxious that the Post Office should absorb as much as possible of the wage awards in productivity improvements, and I know that the Post Office is trying to do this.

Mr. Bryan

Can I get this straight? I asked the right hon. Gentleman a question the other day about what was the total increase in wages agreed with the Post Office since the publication of the last report and accounts, and a figure of £77 million was given. I got in touch with the Post Office to ask for a breakdown between telecommunications and the Post Office. It gave me the figure of £41 million for the Post Office with the remainder for telecommunications.

Mr. Stonehouse

I have not got that information in front of me, but I will ensure that my hon. Friend the Parliamentary Secretary who is to reply will deal with this with some care. On the postal side £26 million has to be paid out, and I am keen that this should be absorbed, as far as possible, in increased efficiency.

Mr. Bryan

The settlement that took place after Christmas involved a figure of over £30 million, did it not?

Mr. Stonehouse

I do not have the figures before me, but we must make it clear that the overall increases agreed for all staff should not be confused with the postal side, which is costing about £26 million a year. It has been suggested in some quarters that postal increases are being held back for party political electioneering considerations. I want to take this opportunity of denying that. If that were the case the increases would have been pushed through a long time ago, without regard to the productivity improvements which I believe can be achieved. Nor would the telephone charges that we are debating be increased now. We would run away from that. I do not think that such a suggestion can be borne out.

Mr. Stratton Mills

While the right hon. Gentleman is on this point, all the papers today say that Mr. Ryland has written in very angry terms to the Minister. Is this so?

Mr. Stonehonse

No. I have not heard from him today, and I certainly have not had a curt note. My relations with the Post Office Board, from the Chairman downwards, are amicable.

Before concluding, I want to deal with the point raised by my hon. Friend the Member for Croydon, South (Mr. Winnick) dealing with concessionary rates for old people and the disabled. The idea of concessions is superficially attractive, but it is fraught with problems. It is very difficult to draw the line. Generally, concessions are an ineffective way of assisting the community, as they encourage an uneconomic use of resources. I would reject the concept of concessions on three counts.

First, the Post Office has no funds, and any concessions would have to be borne by the other consumers. There are no funds to provide welfare facilities. That is not its function. If it was the function of the Post Office it would be function of every other enterprise, and no one has suggested that it is the function of an enterprise to provide concessions at the expense of all the other consumers.

It would be an unfair method of taxation. The Post Office cannot determine the degree of need, nor can an inquiry into the financial circumstances of those who enjoy the concession be made. Thirdly, it is the State and municipal and voluntary bodies which are responsible for welfare facilities and which are in a better position to assess the need and provide assistance where it is required. As my hon. Friend the Joint Under-Secretary of State at the Department of Health and Social Security said the other day in reply to questions, there is an arrangement, through the Supplementary Benefits Commission, whereby those who require assistance can obtain it. I will consult with my right hon. Friend to ensure that this concession is widely known to those who require it.

Mr. John Mendelson

My right hon. Friend has been referring to elderly people. Will he bear in mind that one of the main means of communication for elderly people is to write a simple, ordinary letter? Will he therefore do everything he can to see that there is no further steep increase in the cost of postage stamps?

Mr. Stonehouse

That is what I want to avoid. I want the cost of wage increases to be absorbed as far as possible by increased efficiency.

The hon. Gentleman asks why these increases were not referred to the P.I.B. He reminded us that we had a report from the P.I.B. only two years ago. It is worth remembering that at the end of its report the P.I.B. said: In spite of its defects we have been favourably impressed with the efficiency of the Post Office and its high regard for the public interest. There was a full investigation into efficiency and techniques adopted by the then G.P.O. It would be superfluous to have another investigation now, particularly as these tariff changes are related to a political decision to increase the target rate and are not related to internal factors to do with efficiency.

I do not believe that a case has been made out for the Motion, and unless it is justified in the course of the Debate, unless there is a clear answer to the question which I have put—namely, " are the Opposition in favour of the development programme or would they increase taxation? "—I would ask hon. Gentlemen opposite to withdraw the Motion. If they fail to do so, then my hon. Friend the Parliamentary Secretary will ask the House to reject it.

5.15 p.m.

Mrs. Jill Knight (Birmingham, Edgbaston)

The Minister has reinforced my conclusion which I reached some time ago—that if only the Government would come down to real life situations from their ivory tower of indifference and self-adulation it would do them a power of good. They seem to think that unpleasant facts like those outlined in the speech of my hon. Friend the Member for Howden (Mr. Bryan), and like the Child Poverty Action Group's allegations about the plight of the poor people under a Labour Government, will simply disappear if treated to sharp bursts of Ministerial petulance.

Mr. John Mendelson

When did the hon. Lady write her speech?

Mrs. Knight

The Minister would do better to boast a bit less and listen a bit more. [Interruption.] Anyone who tries to stop me telling him that will have a very difficult job on his hands. The right hon. Gentleman would be better advised to show interest rather than indignation.

Mr. Mendelson

Will the hon. Lady allow me?

Mrs. Knight

No, the hon. Lady will not allow the hon. Gentleman at this stage in her speech. If he is patient his wish may be granted but he must allow me to conclude my opening remarks.

If the Minister were to show interest rather than indignation and resolve to improve, instead of hitting out at those who suggest that improvements might be necessary, we might get somewhere.

The Labour Government have produced a worsening situation for millions in Britain, and one place where that situation can be seen with even greater clarity is in Post Office services. Many people are irritated and angry by the introduction of all-figure telephone numbers. It makes no difference to the dial if there are figures instead of letters, but it is now very much more difficult to remember a number and look one up in the book. It is rather irritating to be told that we have to do this because it is convenient to the Continent.

Blow the Continent! If British people find it easier to find telephone numbers under the old system why must we change it? No one has explained that, and I would like to hear an explanation. There are unprecedented numbers of complaints about wrong numbers. Never in all the time that I have been answering the telephone have I had so many people ring me only to find that it was a wrong number. These are valid criticisms about efficiency. Is a charge made for the call if a person dials the right number on an S.T.D. long distance call and is answered by the wrong number?

In spite of what the Minister said about the Aims of Industry, I am sure all hon. Members have had many letters from constituents complaining about the late arrival of letters and about letters taking longer than they used to on their journey.

I have had another steady stream of letters complaining about spanking new ornate post office buildings plentifully dotted with counter places, few of which are ever manned, causing the building up of queues in front of the few positions which are open, while three or four positions remain clerkless and useless.

To take up this point made by a constituent, I kept watch on a post office in my constituency housed in a beautiful new building, and this situation is absolutely true. [Laughter.] It may be that hon. Gentlemen opposite have all the time in the world to collect their pensions, but some people have difficulty in finding time, and it is intensely irritating in a brand new post office to see positions which are never manned. They are not just not manned at lunch hours; that they are never manned.

One cause of complaint which brooks no delay is the cost to the users. I am sorry that hon. Gentlemen opposite think that this is hilarious. It is not hilarious to those who have to pay more than they can afford on letters and telephone calls. Hundreds of thousands of people find the sending of a few letters a costly business and the sending of a parcel or a telegram a sheer impossibility. Those people are hard hit by the effect of high post office charges on prices in the shops. No business can run without using post office services, and a steep rise in post office prices must have an impact on other prices.

My chief concern is for the elderly, the sick and the handicapped who are utterly dependent on the telephone and who are afraid that their telephones will have to be disconnected when the charges are increased in July. Some months ago, long before the increase was announced, I wrote to a national newspaper pointing out that to many needy people the £20 installation cost and the £3 10s. or £4 quarterly rental was a financial burden which it was impossible for them to bear. This was a short letter, not in a prominent position, but I received 104 replies to it. I was shocked and saddened by the situations which those replies revealed. I should like to read one or two of those letters, as they are important in the context of the debate.

The first one is as follows: I am one of the old people concerned. I have no relations whatsoever, and live alone in a detached house, and to have a 'phone I have had to go without television, washing machine etc., and cannot afford to have any help in my house. I only make a call in an emergency and my bill quarterly is rent £4, calls 4s., sometimes less. I am 74, and my mother, who died six years ago, lived to be 95, and I nursed her at home day and night. I had to spend some capital, which has made things very difficult now with the ever-rising cost of living. My income is all derived from dividends on shares bought by a lifetime's savings, but this is classed as ' unearned '. I have the retirement pension, and am very thankful for it, but the recent rise was swallowed up before I had it. Another letter is as follows: I am 78 and have to rely on the 'phone to contact my son and the doctor. I am a person with very bad health, being diabetic, with arthritis in my knees and subject to branchial asthma. Also I have got a continual septic foot that prevents me getting out. I live alone with just my pension of £5 9s. I really could not afford to pay any more increases. Those two letters are typical of many I have received and illustrate the plight of many people. Each one of the other letters which I shall read deals with a specific point. One says: I am 78 years old and lost my husband three years ago. As I now live alone, I decided to keep the 'phone for emergencies. I am deaf, too, so I not only pay rental for a shared line but 12s. extra for an amplifying receiver. I usually have five calls a quarter, and they cost me nearly £ 1 each. I have inquired for a flashing light as I cannot hear the bell, and the charge was 12s extra, so no light. That letter deals with a point which has not been raised and which I ask the Minister to consider.

My next letter is as follows: I have been a telephone subscriber for over 30 years. I moved from Anglesey to Crawley to be near my children. I asked that I be treated as a reconnection (charge £3 or £3 10s.). I even wrote to the Postmaster-General, who said he had referred the matter and the point raised to Brighton. Chester, my previous local exchange, and Brighton were very sympathetic, but it was the rule and so I was treated as a new installation. That letter deals with a different point.

The next letter concerns a person who had to deal with illness of her husband, who died shortly before she wrote the letter. She, too, is elderly, and she says: He was in hospital for a fortnight and each day I had to go about half a mile to 'phone, as the kiosk by us was out of order owing to vandals, and it caused me great distress, as I am 75. The last letter says: I have written to the Post Office two or three times asking if some scheme could be worked out whereby those on pensions and small fixed incomes could have some reduction of rent. Each time they reply it would be impossible to devise such a scheme. I do not see why it should be impossible. If we paid one account at the post office, couldn't we take our pension books, our birth certificates or even our income tax returns? That letter illustrates another fault.

I beg the Minister to consider all these matters, which add to the burdens of people who are unable to bear them. The Minister referred in his reply to my Parliamentary Question on 13th April asking whether elderly persons living alone could be assisted with the installation cost of a telephone. I take his point, that he is not responsible for social security; he is just responsible for telephone charges. His telephone charges are causing great worry and disturbance to many people. The answer I received was: Help is already given to supplementary pensioners who are unable to pay for a telephone from their own resources when the Supplementary Benefits Commission is satisfied that one is essential."—[OFFICIAL REPORT, 13th April, 1970; Vol. 798, c. 24.] This must be the best kept secret since D-Day. Very few people are aware that they are able to claim some help. I do not understand why this information has had a " D " Notice slapped on it. If help is available we should tell people that it is available.

All the letters I have read out I have selected from a large number which I have received. I have had even more since the Parliamentary Question last week.

Mr. Sidney Bidwell (Southall) rose—

Mrs. Knight

I will finish this sentence —and all the letters I have selected to read were from people not eligible to receive any benefit at all from the Supplementary Benefits Commission.

Mr. Bidwell

I respect the hon. Lady's compassion for those who need telephone communication, but she is making out a case for free telephone communication for many people. If that is so, how would she finance it?

Mrs. Knight

It is absolute nonsense to say that I am making out a case for a free telephone service. All I have said is that these people need help with their telephone bills. I have not said that they should pay no charges at all. They themselves do not ask that they should pay no charges at all, but they are anxious about the increased charges which they will have to pay. None has suggested having the service free, nor do I suggest it. I am suggesting that when a nationalised concern imposes such steep rises in cost, then we should protect the people who will suffer most.

I feel strongly that we should press the Minister hard on the few remarks he made at the end of his speech about help from the social services. He said something to the effect that he would talk to his right hon. Friend about getting more help through the social services for people who find themselves in this kind of difficulty. I welcome this, and would urge him to go straight from this debate to have a chat with his right hon. Friend as soon as possible, since this matter is urgent.

As I was saying before I was so politely interrupted, the people whose cases I have brought before the House today would not be helped by supplementary benefit in any way, yet they badly need help. If those people have to go into homes or hospitals—

Mr. John Mendelson

The hon. Lady makes a passionate case, as often occurs when the Tories are in opposition. What part of her party's policy exists at present to provide additional public expenditure to relieve all the people she has mentioned? Why does she not give up this odious piece of hypocrisy and address herself to the point?

Mrs. Knight

The Conservative Party has consistently said that help should be available for people who need help.

An Hon. Member

Why do the Conservatives never do it, then?

Mrs. Knight

They did it frequently, and they will do it again very shortly indeed. There will soon be an opportunity for the Conservative Government to do something. [Interruption.]

Mr. Deputy Speaker

Order. The Chair would like to hear the hon. Lady, too.

Mrs. Knight

I was deploying the valid argument—

Mr. Mendelson

Your party has never helped at any time.

Mrs. Knight

I shall not be stopped by hon. Members opposite. I was deploying the argument that if people who are ill and need help are not assisted in the costs of having a telephone, then a good many of them will have to go into homes or hospitals. This will cost the community a great deal more money than I am suggesting ought to be spent on this provision now. I believe that these people are much happier in their own homes and would far rather be given the means to stay there.

Mr. Winnick

No doubt the hon. Lady will know that I happen to agree that the aged who live on small incomes and the handicapped should be assisted. We on this side of the House will continue to press the Minister, as I pressed the Prime Minister the other day, on this matter. But would she recognise that her argument would carry far more conviction if her party when in office had brought in the rate rebate system that we have brought in which has given such help to a large number of retired people living on small incomes?

Mrs. Knight

While I was a member of a local authority, which was Conservative-controlled, we brought in a rent rebate system. The hon. Gentleman must not imagine it is a Labour idea.

The Minister has asked where we can suggest economies could be made. I will outline one area in which they could be made; namely, the area of advertisements.

Mr. Leadbitter

In regard to the hon. Lady's assertion that she introduced a rebate scheme in a local authority, will she concede that her council would not have the legal power to do so? I do not know whether she was in the House when I raised the point, but her own Front Bench did not deny that it is Tory policy to introduce de-nationalisation. How could she carry out any promise of concessions to old people?

Mrs. Knight

This is getting ridiculous. I thought that there was some rule that an interjection should take up the points being made by the hon. Member being interrupted, rather than something that somebody else may have said at some other stage. I do not know what the hon. Member for The Hartlepools (Mr. Leadbitter) was talking about when he introduced the matter of denationalisation.

Mr. Leadbitter

On a point of order, Mr. Deputy Speaker. The hon. Lady was saying that I did not refer to a matter which she raised.

Mr. Deputy Speaker (Mr. Sydney Irving)

The hon. Gentleman is raising a point of order to enter into the debate. I cannot comment on what the hon. Lady said in this context.

Mrs. Knight

I said nothing whatever about de-nationalising the Post Office. Frankly, I doubt very much whether any of my hon. Friends said it either. [Interruption.] There is a great difference between what is desirable and what is possible. It would be highly desirable if we could de-nationalise just about everything, but we are now talking about possibilities.

Hon. Members opposite must not claim some miraculous monopoly in having introduced help for ratepayers and rent-payers, because it has not been done solely by a Labour Government, and they must face the fact. [Interruption.] I hope I may be allowed to get on with my own speech.

Mr. Bryan

Would hon. Members opposite not agree that the loud voices we are hearing from the other side of the House show a guilty conscience, when every statistic shows that the poorest are poorer under this Government?

Mr. Faulds

Very gallant of the hon. Gentleman.

Mrs. Knight

Having been irritated by the large numbers of futile and puerile advertisements by the Post Office in the Press, I put down a Question on 9th June, 1969, inquiring how much money had been spent by the Post Office on advertising. The Minister, then the Postmaster-General, gave me a full and helpful reply indicating that in the 12 months ending 31st March, 1969, almost £2. million had been spent in this way, though I concede that £500,000 had been spent on recruitment.

I was anxious to find out whether there had been any diminution in the amount spent on advertising in the 12 months following that period, and I put down another Question which was answered on 16th March, 1970. I then asked what was expended on advertisements in the Press, on poster sites and on television publicising various aspects of the work of the Department in the nine months from 31st March to 31st December, 1969. By this time the Minister had " got out from under ", he was no longer the Postmaster-General. I received the answer that this figure could not be given because the Post Office was now a corporation.

Mr. Eric S. Heller (Liverpool, Walton)

Your party demanded a corporation.

Mrs. Knight

I have been appalled by the amount of money poured out day after day on advertisements, in both national and local newspapers, telling people to phone their friends after six and at weekends. Any fool knows that telephone calls are cheaper after six and at weekends. Surely a small notice printed on the front of the telephone book would have been cheaper than taking great spaces in the newspaper for such advertisements and telling people to read the yellow pages. Why spend thousands of £s telling people what they already know.

Mr. Heffer

Will the hon. Lady give way?

Mrs. Knight

No, the hon. Lady will not give way any more. The Minister would do well to point out to the Post Office Corporation—[Interruption.) I am sorry the hon. Gentleman so much dislikes hearing what I say. Perhaps I should claim some credit for that. The amount of money spent on advertisements would go a long way towards helping the needy people whose I cases I have put forward this afternoon. If the Minister seriously thinks that any of them will receive a crumb of encouragement or comfort from being told that they can ring Japan cheaper than Japan can ring Belgium, or whatever it was he said, then he is wrong.

The whole conduct of hon. Members opposite in this debate and the speech of the Minister illustrate what I have suspected for some time. It is that the only heart the Labour Government possesses is that of the right hon. Lady the Minister of Overseas Development, and that the amount of soul they have available can be beaten by anything seen on a fishmonger's slab in any part of the British Isles.

5.39 p.m.

Mr. John Golding (Newcastle-under-Lyme)

I should like to declare an interest in the welfare of all the staff in telecommunications. I should like to refer to one reference by the Minister to restrictive practices in the Post Office. I am sure that this will be resented by many staff who since 1919, through the Whitley machinery, have done all they can to avoid restrictive practices. The increase in labour productivity in the Post Office has been considerably higher over the last few years than in industry generally.

The Post Office Engineering Union has for many years taken a stand against tariff increases. We believe that the most urgent need of the Post Office was to increase the number of calls. On this occasion the union has made it clear in a letter to the Users' Council that it gives general support to the proposals approved by the Minister. It has done so because we want to see even further increases in investment.

The money cannot be borrowed from the Government without creating additional tax burdens. It cannot be expected to come entirely from an increase in business, and we do not want it to come from private sources, because we think that eventually the public, the consumer, the subscriber, would quickly suffer. Rejecting these proposals we see no alternative for the future well being of telecommunications but to increase tariffs.

This debate is based on an Opposition Motion of censure. Given, however, their past record, it can only be assumed that it is part and parcel of their campaign to undermine public confidence in the telephone service, in the hope that one day they will be able to hand over, wholly or in part, a highly profitable public industry to private enterprise. Assisted by substantial donations from Plessey to the Tory Party and other anti-nationalisation concerns, industrialists are hoping to gain control of the fastest growing technically based industry in this country, an industry which is not only earning a surplus of £50 million a year, but also has an even greater potential for profit.

What arguments are being put forward by the Opposition? Some are purely ideological. The hon. Member for Acton (Mr. Kenneth Baker) and the right hon. Member or Leeds, North-East (Sir K. Joseph) argued in Committee on the Post Office Bill, 1969, about the need for competition. Reference has been made to this from the Opposition Front Bench today. But it ignores the experience of telephone administrations abroad, and going back a long time, it ignores the experience in England before 1912 when the telephones were nationalised not by a Socialist Government, but by a Liberal Government, because chaos had been created under the private ownership of telephones.

Mr. F. A. Burden (Gillingham)

What about the chaos now?

Mr. Golding

The whole system operates now only by the good wish of the Post Office which provides a trunk circuit and the research on which it can operate. It exists as it does because of an agreement in 1912 which the Post Office has honoured. That is a point which should be made in the debate.

Other arguments, not concerned with ideology, are more important. I refer to arguments raised by the Opposition based, as they are, on considerations of efficiency and the financing of investment. It is argued that the investment needs of the telephone service can only be met from private capital. But, since Labour came to power, the telephone service has not been starved of capital, as it was before. Indeed, the argument seems to have changed. So great has been the increase in capital investment that the Opposition now say that, because the needs of capital are so great, the system ought to be handed over to private enterprise.

But if private ownership was allowed, is it even true that a comparable investment programme could be undertaken? Can private industry possibly stand £540 million a year being redirected into the telecommunications business? How can the Post Office, whose profits now contribute so much to its investment programme, stand to lose the massive return on capital that would have to be paid to investors to attract capital in such enormous amounts, although—and this must surely be noted—there have been the most incredible suggestions made by right hon. and hon. Gentlemen opposite that the telephone service be given away or be sold as less than cost?

The hon. Member for Acton looks surprised. But let him read the speeches of his right hon. Friend the Member for Wolverhampton, South-West (Mr. Powell).

This business is worth £1,700 million and £2,700 million will be added in the next five years. This is far too big a business, far too important a business, for the Opposition to give away to their industrialist friends.

I emphasise the point made by the Minister. Would the private industrialist be prepared to accept a rate of return of 10 per cent. on capital, or would he want a rate of return of 17 to 20 per cent.? If he does, where is the money to come from? More important—I am sorry that the hon. Member for Birmingham, Edgbaston (Mrs. Knight) has left the Chamber—would a privately-owned telephone system be prepared to subsidise rural services, as the Post Office does today?

Mr. Tom Boardman

So that we can know what we are comparing with what, will the hon. Gentleman make clear whether he is talking about a 17½ per cent. return before taxation as against an 8½ per cent. return free of tax? It is important that we know the comparison that he is making.

Mr. Golding

I am suggesting that it would be more difficult, as the Opposition spokesman said on the passing of the Post Office Act, for the Post Office to raise 17 to 20 per cent. after or before tax.

Mr. Boardman

Which?

Mr. Golding

After tax. It would be more difficult for a privately-owned telephone system to raise that than for the Post Office to achieve its rate of return. In fact, the Opposition attacked the Post Office for being feather-bedded—for having to earn a rate of return less than that of private industry.

Mr. Boardman

Will the hon. Gentleman give way again?

Mr. Golding

No.

One answer to the problem suggested by Opposition spokesmen was that American capital and management be introduced into the British telephone system. I remember that the right hon. Member for Wallasey (Mr. Marples)—I am sorry that he is not here—was particularly keen on this latter suggestion. Apart from not wishing to lose our profits, it would worsen our balance of payments and bring one of our major technological industries under foreign domination. Some Tories have been hell-bent on handing our telephones over to the American Bell system. It is ironical that this should be so.

I think that the Minister mentioned that the Sunday Times, on 20th July, 1969, reported: Quite simply the American telephone and telegraph company, Bell, is breaking down. In some major cities like New York it is on the verge of collapse. The Sun has reported that a New York advertising agency, Benton and Bowles, has taken out a full-page newspaper advertisement to apologise to its customers for their telephone troubles.

Mr. Burden

Does not the hon. Gentleman agree that it is about time our Post Office authorities published a large-scale apology for many of their failings?

Mr. Golding

The point is not that the A.T.T. is apologising. It is to be taken to court. The point is that a large industrial user in New York has found it worth while to apologise for the service given by the Bell Company. The advertisement ends: So in the meantime keep those letters and cards coming in folks. That is because they cannot get service in New York.

Yesterday, we learned that 25 directors and top officers of American T.T. had been charged in the courts with gross mismanagement, misconduct, negligence and waste, and accused of cutting capital investment to maximise profit. These are the charges being made against the Bell Company, which hon. Gentlemen opposite have eulogised for so long. It has maximised profits and cut investment, and it is now charged with the collapse of the New York telephone system.

Mr. Burden

Would the hon. Gentleman be surprised to know that about two months ago I received from the Post Office in London four letters which originated from outside Birmingham? They were all addressed to people in Birmingham. They were delivered to me at Latymer Court, Hammersmith, and I sent them to the Minister.

Mr. Golding

The hon. Gentleman seems to have overlooked the fact that I am talking about the telephone service. He may not know the difference between the telephone service and the postal system.

Traditionally, hon. Gentlemen opposite have said that our Post Office is superior to the American one, but then they say that the American telephone service is superior to ours. There has not been a collapse of the telephone service in London, as there has been in New York. The collapse there was forecast by Mr. Joseph Bierne, the President of the Communication Workers in America. In an article which he wrote many months ago he charged the Bell Company with putting profit before the interests of the consumer and of the staff.

It would be worth the while of hon. Gentlemen opposite to go to New York to study the collapse of the American system. It has arisen partly from a practice which is being suggested by hon. Gentlemen opposite for our telephone service. Telephones have been fitted in New York on demand, for which there is no exchange equipment or cable available. It is like fitting a gas stove when gas is not available.

Mr. Ian Gilmour (Norfolk, Central)

Our Motion deplores the decline in the British telephone system, not the American one.

Mr. John Mendelson

Who made the comparison?

Mr. Golding

If, this afternoon, the Opposition agree that in future debates on the telephone service we are not to discuss America, I shall pass quickly on to my next point.

Mr. Mendelson

A very good answer.

Mr. Golding

Having commented on the situation in American, I have to admit that there are problems connected with the British system [HON. MEMBERS: " Hear, hear."] Hon. Gentlemen opposite should not say that about failure. The incidence of call failure is too great, and there is a substantial waiting list. Attacks on these problems ring a bell with me, because in 1960, 1961, and in subsequent years, together with my noble Friend, Lord Delacourt-Smith, I was involved in a campaign to try to bring home to hon. Members the serious situation confronting the telephone service. We pointed out the disastrous future for our telephone service if the policies of right hon. and hon. Gentlemen opposite were not discontinued.

In 1958 and 1959—I am sorry that he is not here, but we saw him briefly earlier on—when the right hon. Member for Wallasey was Postmaster-General, the growth rate was only 1.8 per cent, and 1.9 per cent., and it was left to our union to set targets of 10 million telephones, a 5 per cent, growth rate, and a telephone in every home. We decried the cut in the recruitment of apprentices, from which we are still suffering. At that time profits were low, and investment was virtually stagnant. The fault rate was allowed to grow, whilst a meagre expansion of the service was given priority over maintaining quality.

That is what happened in 1958, 1959, and 1960. We cannot expect, overnight, to put right the neglect of those years, but we can surely expect to be free from attacks by right hon. and hon. Gentlemen opposite when we are getting on with the job which they failed miserably to do. Over the last five years the growth rate has been 6.6 per cent., and productivity is increasing by 8 per cent, a year, which is a tribute to all those involved.

The rate of increase would have been even greater had it not been for the failure of the telecommunications equipment manufacturers to deliver their orders on time. The right hon. Member for Leeds, North-East has demanded more competition, but we certainly have not seen it in the private telecommunications equipment industry. Complaint after complaint has been made in this House, and by the Comptroller and Auditor General, about the prices of equipment and the failure to meet delivery dates.

The situation is the same today. Private enterprise—Plessey, G.E.C., Standard Telephones and Cables, and English Electric—fails, but the Post Office gets the blame. The Opposition even use the failure of private enterprise as an argument for handing the Post Office over to private enterprise. What an Alice in Wonderland situation!

Many of us concerned with the interests of the industry agree with those, such as the independent Brookings Institution Inquiry, who say that the Post Office should expand its research activities and consider acquiring one of the stronger supply firms for production and experimentation. The emphasis in the new Post Office should be on the extension of its services, rather than on contraction. In an earlier debate I referred to the advantages of the Post Office controlling broadcasting transmission. There are also strong arguments for the rapid development by the Post Office of data transmission and processing.

Before concluding I should like to refer briefly to two other topics—advertising, and the level of tariffs. I was one of those who strongly advocated the use of advertising, and right hon. and hon. Gentlemen opposite today join us in demanding that the Post Office should advertise its services. The old financial problem of the telephone service was the lowness of the calling rate in the off-peak period, compared with that in other countries, and much capital equipment still remains unused at night and at the weekend. It is economic sense to encourage the use of this equipment at times when it is lying idle.

Any commercial firm would do this without a hint of criticism from the Opposition. In any case, it is sensible to bring home to people the cheapness of making calls in the evening and at weekends. It should certainly be made clear that the telephone service is not expensive. Some years ago, I was surprised to learn this when I conducted a survey for the Postal Telegraph and Telephone International. My results were confirmed by a Which? report in September, 1969. America and France were much more expensive and only one country was cheaper. Now, even with these increased charges, only two countries are cheaper.

The Post Office has been sensible in its choice of increases. Exchange lines and apparatus have been making losses and these losses will be cut. The introduction of a further peak rate period in the mornings is in line with Report No. 1958 of the National Board for Prices and Incomes. Those responsible for peak demand should pay for the capital equipment required to meet those peaks. This is one good reason for having a differential between the business and residential rentals, because the majority of residential calls are made at off peak periods. We do, however, think that there are possibilities of introducing further cheaper low rate periods after 9 p.m.

But telecommunications face a great future. This can be seen by the eagerness with which the Opposition want to get their hands on them—

Mr. John Wells (Maidstone)

The hon. Gentleman is dealing with the possibility of extra cheap periods after nine o'clock, but the bulk of my constituency complaints are from old people and other deserving categories who cannot afford the going price at any time of day.

Mr. Golding

I should have liked to talk about the way in which the Post Office Engineering Union put proposals to the Post Office some years ago, whereby they would fit and maintain telephones free of charge for the housebound, the disabled and the elderly. But I have taken a long time and should not develop that point.

Telecommunications have a great future. It has been my responsibility tonight to draw attention to the thoughts of the staff of the telecommunications service and their fears that the policies of the Opposition could put their livelihood and the services which they give into great jeopardy.

6.3 p.m.

Mr. John Tilney (Liverpool Wavertree)

I greatly doubt whether the constituents of the hon. Member for Newcastle-under-Lyme (Mr. Golding) will have fully followed his hypothetical and philosophical argument between the benefit of private enterprise and a State corporation. Nor are they particularly interested in how many millions or tens of millions of pounds of the taxpayers' or the subscribers' money will be spent on capital investment.

But I agree with the hon. Member over one thing—the need to extent services. I am not against the new corporation borrowing in order to do so. History shows that any enterprise, if it can produce what is wanted and can lower prices rather than raise them, may increase profits rather than losses.

What I believe the hon. Member's constituents and mine are really interested in is that they should be able to post a letter which arrives the next day, that it does no cost too much and that they can also telephone their relatives at not too great a cost. These are the fundamentals in which the electorate are interested. I am surprised that there have been so few suggestions today of how either the postal services or the telephone service could be improved either for the public or for those who work in those services.

The Minister—how I regret that the title of Postmaster-General has gone-glorified his administration. He must be unaware of the letters which most of us are receiving about the difficult which people have in getting their letters to the right destination at the right time. He referred to my hon. Friends trying to make this debate a political plaything. i do not wish to do that. I was Parliamentary Private Secretary at the Post Office for a number of years and I know something of the calibre of those who work there.

Only last week, I experienced an example of the courtesy of a telephone operator. I had been asked by Merseyside Radio to comment on the Budget and I had to leave after what I had hoped would be a shorter speech by the Chancellor. I could only ring up at Euston, because I had to catch a train to my constituency. Nothing could have been more courteous than the telephone operator, and the fact that he put me through to Manchester instead of Liverpool the second time is beside the point: he at least tried very hard.

The Minister also said that standards were rising compared to the days of the Conservative Government. So they should. I wonder whether they have risen anything like as much as they did during our years in power. Of course standards of living are going up and therefore more people want a telephone.

The Daily Mail reported on 14th April that it had posted 49 letters in London and other towns, but only 28 arrived the next day and only 13 by the first post. A Post Office director of operations analysed those results. Of the 21 letters which did not arrive the next day, he noted that two apparently missed the last post and seven were sent on routes on which the Post Office could not deliver the next day. But eleven could have been delivered the day after posting.

If there is a risk of an important business letter not being delivered, what can be done? I have written constantly to the Minister about this. Some firms, including mine, are reduced to sending couriers both to London and to Glasgow, because there is no method at all of ensuring that an important package can arrive the following day, whatever we pay. This is something which the new corporation should look at carefully.

One enjoys meeting postmen, but when I asked one whom I have known for many years in Liverpool to come in for a cup of coffee last week, he said, " I could not possibly come in; I would never get round, if I went in, except at Christmastime, to people's houses ". It is no good Lord Hall suggesting, much as one enjoys a chat with one's local postman, that that sort of camaraderie, which one would welcome in the ordinary way, is possible, because postmen have so much to do and also have an increasingly heavy load.

Business now sends out advertisements, and it sends out envelopes which are very much bigger than in Victorian days when they possibly wrote vertically and horizontally on their notepaper and then folded it up into small envelopes and stuck those envelopes into little apertures which are still in many pillarboxes and also in many letter boxes on houses.

I appeal to business and to many individuals to see whether they cannot have larger letter boxes. It would help the delivery enormously because quite often —and I have talked to a number of postmen—they cannot get a particular package through the old type of letter box and have to wait until somebody arrives in the house or the business concerned.

I also think that the weight of what the postman has to carry has gone up very considerably. I am told that a postman is limited to carrying 35 lb. and that if the weight is greater than that he can always ask, according to the rules, for an assistant. But assistants are not available and he must either leave some of his post behind or carry around a very much heavier bag than he should, and no modern gadget has been given him to help him. Those playing golf have a trolley for their golf clubs. Why cannot the Post Office produce for the urban postman a similar type of trolley, painted bright scarlet and locked when put away, which would be of immense benefit to him?

Suburban and country areas will in the end, if the postal rates are to be cut down or kept at their present level, have to go in for the boxes which one sees in America and Canada at the garden gates or on the pavement. I do not believe that we shall be able to avoid that, nor shall we be able to avoid it in the big blocks of flats. We shall have to have postal boxes for everybody if we are to reduce the number of postmen who are needed. If people are ill I believe that the Post Office will have to take particular note of which houses will have to have individual delivery. These are the sort of possibilities that I believe we should be considering in a debate such as this.

I turn to the telephone. Nothing so far has been said about vandalism. In the Liverpool Echo yesterday there was a photograph of a Mrs. Budd who walked two miles from her home before finding a telephone in service and when she got there she waited three-quarters of an hour in the queue for her turn to use it. Constantly I hear from my constituents that because of vandalism they are unable to find a telephone which is usable within a very large radius of their homes. There is another picture in this paper of a kiosk in Edge Lane, part of which runs through my constituency, and under it is a caption which says that all mechanism has been removed and that its history is that it has been damaged 37 times since January, 1969, and out of action for normal calls since December and in use for emergency calls only since 13th April. I hope that the Minister will say what his plans are for dealing with such vandalism.

I have a suggestion to make to the Parliamentary Secretary. I made it to the Minister himself, and I had a letter back, similar no doubt to the reply made to my hon. Friend the Member for Birmingham, Edgbaston (Mrs. Knight), which said that from 1st October 1969 the new Post Office Corporation had assumed responsibility for the management of post office services. So he merely handed on my suggestion to the new corporation.

But I am told that until 1948 it was possible to have in shops and other centres public telephones which could be used but at no cost to the shop itself. Now I am told that the shop would have to pay for the installation of such a telephone. The argument against such telephones being put into shops, community centres or similar places is that they would not be available to the public for 24 hours in every day. But half a loaf is better than no bread and if the Post Office can put telephones into a number of shops or other places where they can be under guard—and the community centres open for very much longer hours than shops—then the vandals will be defeated. It is most unlikely that they will wreck the telephone, and people who urgently need to get across messages of illness, death and so on will always know where they can find a public telephone. I very much hope that the Minister will consider that very carefully.

Will the right hon. Gentleman bear in mind that he operates a monopoly. Other nationalised industries are not monopolies in the same way. There is competition against British Rail, and one can change from electricity or gas to another fuel. But the Post Office really is a monopoly. Will he bear in mind how expenses have gone up? From 1958 to 1964, when the Tories were in charge, connection charges went up 100 per cent. But in the last six years, under this Administration, they have gone up 150 per cent. The residential exclusive rental went up under the Tories by 16 per cent. and under the Labour Government by 43 per cent. I shall not labour all the different charges but the increases have always been immensely greater under the present Government than under the Conservative Government.

My final request concerns the ill and the needy for whom a telephone is a lifeline. Would the Minister consult the Secretary of State for Social Services and see that in every Post Office there is a pamphlet explaining what supplementary benefits are available for the installation or maintenance of the telephone for people who urgently need it?

6.20 p.m.

Mr. David Winnick (Croydon, South)

The Motion is totally unjustified. It is silly and petty. I saw little sign of enthusiasm in the hon. Member for How-den (Mr. Bryan). If anything, I conclude that the Shadow Cabinet, for obvious reasons, pushed him into tabling the Motion and making that speech. He made little case, whereas I was impressed by the arguments put forward by my right hon. Friend the Minister of Posts and Telecommunications.

Complaints obviously often come to hon. Members on both sides. When considering the vast amount of mail each day, it is understandable that complaints should arise. But when one analyses some of the inevitable delays in postal services, I do not believe that they come to much, bearing in mind the total number of letters and parcels involved. However, I always make a point, when constituents complain to me, of following up each one. Sometimes I am not satisfied with the reply I receive, but genuine complaints should be followed up. I do so.

But what I get rather tired of are the complaints which sometimes come from the Opposition against the Post Office. They are not on matters of policy, but are petty and silly complaints. We get the idea, from this side at least, that these complaints are made merely because the Post Office is a nationalised industry, and that the attitude is, " It is used by a large number of people in the community, so that is every possible reason for us to have a go at it ". Considering some of the huge private monopolies and the mistakes they make—again, inevitable—we do not find the same attitude from the Opposition. Let us keep in perspective the complaints made about the day-to-day use of the Post Office. If constituents have genuine complaints, we should be willing to take them up.

We should not lose sight of the need to ensure that postal workers get a decent standard of living. Not long ago, a large number of them were extremely dissatisfied. It is all very well to complain about increased charges and the rest, but it is essential to ensure that this large body of people, doing an important job—we all know how irritating it is if the postman is late—get proper wages.

Many postmen in my constituency complain to me that they sometimes seem to be lagging in wages behind other sections of the community. The recent settlement has given them some satisfaction. It is important that this large group of people should be properly paid and there is no reason why we should not be willing to see this done.

I am also concerned about the policy —whether it is official or not, I am not certain—that, under a Conservative Administration, a large part of the telephone system would be placed in private ownership. Is that the official policy of the Opposition? Do they want to undermine and disrupt the Post Office in such a manner? If it is their policy to put the telephones or a large part of the system in private ownership, I hope that we in the Labour Party will make the public aware of the fact and wage a campaign against the idea. There is no justification for the break-up of the telephone system. It should remain in public ownership.

My main reason for intervening is the position of the elderly and disabled, living on fixed incomes, in relation to the increased telephone charges. I intervened in the speech of my right hon. Friend because, like a number of my hon. Friends, I have been concerned about this matter for some time. The hon. Member for Birmingham, Edgbaston (Mrs. Knight) would have made a more effective argument if she had not been playing party politics. It is unfortunate that she did so. I do not deny that the cases she quoted were genuine, but the important point we have to establish here is that, if increased charges are to take place, if they are inevitable, then the people living on small fixed incomes, the retired and the handicapped, should be protected.

Yesterday, my hon. Friend the Parliamentary Secretary, in reply to a Question, said: …if the Supplementary Benefits Commission was satisfied that a telephone was essential it could give help to supplementary pensioners."—[OFFICIAL REPORT, 20th April, 1970, Vol. 800, c. 20.] I believe that there should be far more publicity for this scheme. Perhaps a number of people entitled to such assistance are not receiving it because they do not know about it. There should be far more publicity throughout the country in all kinds of ways to let people know that such a system is available. I am rather worried about people who would not be entitled, under the present scheme of assistance, to claim relief, but to whom a telephone is important and who live on small fixed incomes and deserve help.

It may be argued with justification that the Post Office is not the appropriate organisation to give such assistance and that it should come from the social services. I tend to agree with that. I am not arguing that the Post Office itself should work out and pay for a system of assistance for those living on small fixed incomes. I accept that this is a matter for my right hon. Friend the Secretary of State for Social Services. But I do ask that there should be as quickly as possible co-ordination between the Post Office and the social services to devise a scheme which will ensure that these people are assisted.

A few years ago, when there was concern about rising rates it was suggested that there should be a rate rebate system. The Conservative Government dismissed the idea. They said that it would not work and that Labour Members were exaggerating the situation. What is the position now? The rate rebate system has been introduced and works well. It is giving genuine help to people living on small fixed incomes. As a Labour Member, I am proud that it was the present Government who brought the scheme into being. I believe that it should be extended to other categories of people also needing assistance.

We do not want to reach a situation where only those who are working, who have a fair standard of living, can afford the telephone. That would not be fair and the House of Commons should not approve any such idea. If the Minister gives a promise that far more serious consideration will be given to the idea of giving assistance to the elderly and the disabled, the Government will deserve the vote they will receive tonight in rejecting the Motion.

I am not at all convinced that the Opposition are really concerned about these people. If they were so concerned, they themselves would have brought in a rate rebate system, but they did not do so. They refused to do it when the then Opposition pressed for such assistance to be given.

Mr. Tom Boardman

Does the hon. Gentleman deny that he accepts the philosophy from this side of the House that aid should be concentrated where there is greatest need?

Mr. Winnick

I am not certain what the hon. Gentleman means. It is likely that he is against rebates to a large number of people who would not come within the category he means. What I am saying is that it is not just people who can state that it is essential for them to have a telephone, but the people who cannot prove it but who are nevertheless entitled to have a telephone and cannot afford the new charges who should receive assistance. It is principally on behalf of such people that I make my contribution to this debate.

6.29 p.m.

Mr. Alasdair Mackenzie (Ross and Cromarty)

This is a timely debate in view of the Government's intention to increase telephone charges. I was glad to hear the Minister welcome the opportunity to take part in it.

There are two important reasons which make the proposed increases undesirable at this moment. First, there is the effect on the elderly and infirm. It must be obvious to all of us, and particularly to those of us who live in remote parts of the rural areas, that to have a telephone at hand in an emergency is a boon to the aged and infirm. On medical grounds alone, the Government should devise a scheme which would protect the aged and infirm from the proposed increases.

Many single people as well as aged couples live in remote parts, and it would be a great help if a scheme could be introduced to give assistance in installing telephones. I am not too worried about who would provide the assistance. I should be happy if the Minister said that it should come from another source. The time has come, however, when this section of the community should enjoy the benefits of a telephone service which would add greatly to their sense of security in their old age. I hope that the Minister will regard it as a matter of social justice to let them share in the undoubted benefits of a telephone service.

I do not underrate the achievements of the past few years. The Minister gave an impressive list of statistics to show what has been achieved, and I accept it, but there is the question of the business use of telephones. I am convinced that the proposed increase in charges will severely affect small business firms situated far from the centre of things. I know from experience what it costs to make a long-distance call during the day from the House to the North of Scotland. I have examined the telephone bills of some small business firms in the North. If there is a further increase, their telephone bills will be out of all proportion to the size of their business.

Apart from the cost, in areas where there is special development the services are not keeping pace with the demands made on them. A typical example is Invergordon, in Ross and Cromarty, where there is industrial development. The inadequacy of the service is such that on many days customers must wait several hours to get a line to the industrial parts of the South where they order their goods and spare parts. This is a matter of great urgency, and I hope that the Minister will take early action to improve the service.

In the North of Scotland generally—and I expect that this applies to other parts—the Post Office has been cutting down on many services. In several areas, some of the early morning collections have been stopped, and many sub-post offices have been closed, causing a good deal of inconvenience and considerable concern.

Probably this is a matter for the Post Office Corporation, but I have already drawn the Minister's attention to one case, and he used his good offices, with a satisfactory result. In view of the concern which is felt lest this situation should continue, and more sub-post offices close and there is a further cut in the number of collections, I hope that the Minister will take action so that people living in remote areas will not feel that they must move their homes and belongings to another area to enjoy the necessary social services.

I realise that this matter largely affects the rural areas. I hope that the Minister will note these points. If he can find some other way of providing a service for the old people, I should be happy.

6.35 p.m.

Mr. Ted Leadbitter (The Hartlepools)

The hon. Member for Ross and Cromarty (Mr. Alasdair Mackenzie), as usual, has made a simple, easily heard speech dealing specifically with his constituency problems. His speech was a refreshing contrast to other speeches from hon. Members opposite, even if it was not totally enlightening on the basic problem before the House arising from this unfortunate Motion.

The Opposition's efforts have been puerile in the extreme. I have never heard from the Opposition Front Bench such a weak-kneed effort to excuse themselves from an embarrassing situation arising from the misuse of a Supply day—and that is saying something. The hon. Member for Howden (Mr. Bryan) might well retreat to the back benches after his performance today. But the person who should take that journey is his own Leader.

This is a complete misuse of the House of Commons procedure for another reason. The Post Office, under the new organisation, is hardly six months' old. This is a vast undertaking in telecommunications—the third largest in the world. To draw an analogy, the building of a house takes 18 months from the planning board stage to the end product. The hon. Member for Howden and his party, on a Supply day, have made what they thought was a critique of an industry which is complex in the extreme, a nationalised body with vast amounts of capital investment.

This debate is a confession of embarrassment about what happened during the Committee stage of the Post Office Bill. Not once has the Front Bench—[Interruption.] The hon. Lady the Member for Birmingham, Edgbaston (Mrs. Knight), like a jester, left the court and has now come in to find her second wind. She will have to wait.

The hon. Member for Howden, and the unfortunate hon. Member for Acton (Mr. Kenneth Baker), who I hoped to follow in the debate—I will stay behind in case he makes the same error as he made upstairs—put forward an Amendment in Committee, the importance of which was that it would have made possible the denationalisation of the telecommunications industry. I intervened earlier today and reminded the House of that.

The hon. Member for Howden, who I suspect was the ineffective spokesman on this matter upstairs, then said that it was Tory policy. This is the only basic and fundamental issue between the two parties on this matter. Will the lion. Member say whether this is still Conservative policy—or shall we let someone much more qualified and sitting behind him replace him?

Mrs. Knight

The hon. Gentleman has chivvied me for leaving the Chamber. He may be interested to learn that occasionally delegations visit me. When they do, and when they have been waiting an hour or so, I go to see them. I am not surprised that apparently no delegations come to see the hen. Gentleman. The hon. Gentleman is saying either that there are no complaints from the general public about the Post Office, or that we have no right to use a Supply day to voice them if there are complaints. Which is it?

Mr. Leadbitter

The hon. Lady must remember that I have only just come to my preamble. There is much to come in the middle of my speech and there will be a great conclusion to it. I shall speak for a considerable time. I apologise to the hon. Lady for having " chivvied " her about leaving the Chamber. No doubt the delegation enjoyed her company and have returned satisfied.

The hon. Member for Howden refuses to intervene. The telecommunications part of the Post Office deals with 9,500 million calls a year, with 8½million exchange connections, 14 million telephones, 225,000 employees, and assets to the value of £1,941 million. The hon. Member for Howden should listen to me. He seems to be in a permanent sedentary position.

Whether the Tories like it or not, the public are entitled to know the answer to a critical question, because the corporation's assets are virtually the result of the taxpayers' contribution. If it is intended to denationalise the Post Office and hand it over to private enterprise, how will private enterprise pay for it? Or is it to be given to private enterprise? Before the hon. Gentleman answers that one, I will put a tricky question about the kind of manufacture that might be involved.

Mr. Bryan

The hon. Gentleman may have wondered what I was reading. I was reading The Times Book of the House of Commons to see how the hon. Gentleman got into the House.

Mr. Leadbitter

That was a very—

Mr. Tom Boardman

On a point of order, Mr. Deputy Speaker. The hon. Member for The Hartlepools (Mr. Lead-bitter) sat down. He was not asked to give way. Is it in order for him to rise again, having sat down?

Mr. Deputy Speaker (Mr. Sydney Irving)

An hon. Gentleman who sits down is in danger of losing the Floor. I hope that hon. Members will not repeat the practice.

Mr. Leadbitter

An hon. Gentleman is in great danger when he sits of losing his right to continue, but I thought that the hon. Member for Howden had been so persuaded—he was nearly on his feet —that I would give him that extra leverage so that he could help us out by giving us the answer.

The hon. Gentleman eventually said something which has the greatest political significance. Up to now I have addressed myself purely to the facts—what the hon. Gentleman has said upstairs and the extent of the corporation's assets. If that was an indication to the hon. Gentleman of a qualification for entering the House, he was obviously so desperately in need of something to say that he could not get the right words and he ended up by making as ass of himself.

By 1980, in addition to the present assets of the telecommunications part of the Post Office, it is expected that there will be about 18 million exchange connections and that 72 per cent. of households will have a telephone. That is the first general indication of the results of the investment programme over the next few years.

In thinking about the telephone, the mistake is often made of thinking purely in terms of communication by voice. We are talking about a department of the Post Office which is now involved in data transmission and processing services. We are talking in terms of an extension of the traditional Telex services. By 1980, these are expected to have increased from 30,000 connections to 150,000. This is a new complex to the normally accepted and sometimes mistakenly assessed areas of telecommunications services. In addition to communication by word, there is the intrusion and injection of the computerised elements of communication.

With such an asset available to us, interconnected and related to the whole of our commercial and industrial life, and with the amount of investment involved over the next few years, is it proper to neglect to challenge what is of the greatest importance to the public—the effects of the Opposition's policy?

I have already asked: if there is no retraction of the intention to denationalise this industry, how can it be paid for by private enterprise? In 1968, the total amount of capital investment in manufacture and materials involved with manufacture in the private sector was about £1,763 million. That should be contrasted with the assets in this industry, which in the course of the next few years will be about £2,700 million.

If the private sector has not the capacity to buy from the taxpayer this important part of the Post Office under the policy of denationalisation, how is the objective of denationalisation to be achieved? The answer is virtually simple. If we think it out as the Tories have tried to think it out, the answer is to hand it over with a written condition of repayment at a fixed interest charge.

The Union of Post Office Workers is, of course, very much alive to this danger. Those who work in the industry have a stake in it, which is far bigger than the politicians', with their fanciful theorising. We on this side of the House support the policy which those working in industry want. The politicians to whom I have referred hon. Members opposite are trying to tinker about with it and the people who work in the Post Office are alive to that danger.

One of the great problems of the industry arises out of its need to change so as to meet the explosive demand. We have some indication of this in the suggestion of denationalisation and the implications for data processing and data transmission and the suppliers. Suppliers to the Post Office for telecommunications have pretty well got the Post Office in a grip. This has been the case for a long time. Who happens to be one of the major suppliers to the Post Office in the provision of equipment for telecommunications? The answer is, some " bright sparks " whom I met the other day on another subject, which I cannot mention here because it is in an area of privacy and I would be in court if I did so. I am a member of a Select Committee and I must keep very quiet. The processes of the law sometimes defend the privileges of the House.

I met these people, the niggers in the woodpile, Plesseys, who gave £21,770 to Conservative Party funds this year. That was a wonderful aside. I apologise, Mr. Deputy Speaker, but I want to illustrate how a piece of roguery enters the scene. If a young boy goes to Woolworth's and steals something from the counter, police officers are on to him and rush him into the juvenile court. We get statements by the right hon. and learned Member for St. Marylebone (Mr. Hogg) about law and order, but when it comes to legalised thievery one cannot beat the other side.

The main supplier of equipment to the Post Office for telecommunications of any substance is more likely than not to be Plesseys. There are only two others. I suspect that those other two might have made a contribution to the Conservative Party. Because I am a taxpayer I want to know why money I have put into the industry, my investment, should be treated in such a way that some private owners will get a free gift of the profits. Does the hon. Lady the Member for Edgbaston want to get on her feet to let herself go again?

Mrs. Knight

I am anxiously seeking the guidance of the Chair. I wish to inquire whether what the hon. Member is now saying is in order. Does it have any relevance to the debate, Mr. Deputy Speaker?

Mr. Deputy Speaker (Mr. Harry Gourlay)

Order. Had the hon. Member been out of Order, I would have intervened. He is making a side reference to the Motion.

Mr. Leadbitter

As at all times, Mr. Deputy Speaker, I accept your guidance.

I must remind the House that the Motion deplores the steep rise in telephone charges which will cause widespread hardship and further increased industrial costs, and regrets the deterioration of Post Office services… The issue is how best to measure that and to inform the people of the real deterioration which might take place if hon. Members opposite got their fingers on this highly lucrative and important industry. We must tell the general public what is the state of profit of this industry and what hon. Members opposite want to hand over to private enterprise. I have mentioned Plesseys, but there is another little company I shall mention. The hon. Member for Howden had better try to respond because he has made a statement and must be man enough to stand up to the consequences. This concerns the real motive of the Tory Party.

The profits in the telecommunications part of the Post Office are of this order. When they were taken over in 1912 the profits were £303,000. I am coming to the present position.

Mr. Ian Gilmour

In time?

Mr. Leadbitter

I have time provided that I keep in order.

The amount of information is as good as the quality. In 1964–65, the profits were £39.7 million. In 1964–66, they were £39.3 million. In 1966–67—these, of course, are all Labour Government years —they were £37.7 million. In 1967–68, they were £35.3 million, and in 1968–69, £50 million. Under public ownership all the profit is ploughed back into the industry, together with £200 million per year of the taxpayers' money.

Is not the Tory Party obliged to say that its intention is to take this profit and the taxpayer's contribution and hand it to private enterprise? The situation is worse because the Tory Party is very anxious to hand over some of this industry to an American company, which is a dangerous thing to embark upon. Hon. Members opposite are not unhappy about the fact that the present condition of that American company is not very sound. My hon. Friend the Member for Newcastle-under-Lyme (Mr. Golding) described the telecommunication services in New York as being less efficient than those in London. Yet the party opposite would be prepared to hand over and let that company get its embarrassment off its back.

The hon. Member for Acton might be following me later, but I will not ease him out even though he may have a dinner engagement. He will have to stay and wait to speak. He must, outside the environment of a Standing Committee, have the courage to say here what he said there and then try to refute the consequences I have described. If the hon. Member for Norfolk, Central (Mr. Ian Gilmour) has a brief as good as that with which the Opposition started, he might as well go home. It was a nonstarter, and it will be very embarrassing to have a non-finisher.

Which?,a reputable journal, discovered after the most careful survey that what hon. Members opposite are arguing about represents 2d. in the £ of annual household expenditure. That is what is spent on posts and telecommunications. That is what the big fight is about, and I challenge them on their misguided philosophy.

More telephones are being installed in this country than ever before, and at a better rate than ever. Standards of life are improving at a tremendous rate, but many people are being hurt because they cannot keep up. The lower income groups are often left behind in the improving affluence, and it is difficult to bring them up again.

In restructuring industry, we hurt many people because they have to move and be retrained. At least, we help them with redundancy payments and better social security allowances. We know that the improvement in the standard of life creates more demands. People today are buying more than before—more telephones, cars and other means of communication, such as television. We have more services, houses, hospitals, roads and the like.

It is as a result of the increasing demands that there is a waiting list for telephones, and this is why there is often the kind of complaint the hon. Member for Ross and Cromarty mentioned. Hon. Members opposite should not try to kid the electorate. When someone has to wait for a telephone in my constituency I try to explain the position, and very often with the co-operation of the telephone sales manager I get the kind of results I want. But it is an interminable, difficult task to keep pace with the ex- plosion of demand. Hon. Members opposite must not presume that the aches and pains of progress are reasons to break down an organisation like the Post Office.

The hon. Lady the Member for Edgbaston spoke about helping old people. There is complete unity in the House when we talk about old people, just as when we talk about the injured, the sick, the lonely and those in need. Subjects like these bring the House together. What often divides us is our practical attitude towards them. The Government have a fine record in dealing with these matters. When I intervened in her speech, the hon. Lady said that she had helped by intro-during a rate rebate scheme in her constituency.

Mrs. Knight

I said that the council had.

Mr. Leadbitter

The hon. Lady's intention might well have been right, but the council had no power to introduce a rate rebate scheme and the only legal power was the one introduced by—

Mr. Deputy Speaker

Order. The hon. Gentleman is wandering somewhat from the Motion now.

Mr. Ian Gilmour

On a point of order. Mr. Deputy Speaker. Surely the hon. Gentleman is guilty of boring repetition and is out of order? Many hon. Members on this side of the House want to speak, even if that is not the case on the benches opposite. With great respect, I suggest that the hon. Gentleman has been out of order for a great deal of his speech.

Mr. Deputy Speaker

That is a reflection on the Chair. The hon. Member for The Hartlepools (Mr. Leadbitter) was in order until I intervened. I hope that he will have regard to the usages of the House and remember that many hon. Members still wish to take part in the debate.

Mr. E. Fernyhough (Jarrow)

My hon. Friend was correcting a wrong statement which the hon. Lady made.

Mr. Tom Boardman

The hon. Gentleman was not here.

Mr. Fernyhough

But I was here when my hon. Friend said that. He said that he would like to correct a wrong statement, and presumably ne is entitled to do that if the hon. Lady was entitled to get away with a wrong statement?

Mr. Deputy Speaker

The Chair never rules hypothetically. I can rule only on what I hear in the Chamber.

Mr. Leadbitter

Naturally, 1 accept your Ruling and guidance, Mr. Deputy Speaker. I rose to speak after half-past six. It is not unknown for an hon. Member to speak on an important subject such as this for no less than 40 minutes. Front Bench speakers on both sides have a record of talking for a long time, very often on subjects less important than this.

The hon. Lady said that we were not assisting old people, and I made the point that basically there is no difference between our views on this subject, although there may be a difference in our practical attitude on how to be helpful. There has been no new suggestion today for helping old people. The old would tell many people, " For God's sake stop it." Mouthing about old people without putting forward solutions is nonsense. I have a solution.

Mrs. Knight

I gave one.

Mr. Leadbitter

The hon. Lady missed her opportunity, and her party missed the opportunity after 13 years.

My solution is simple and easily administered. It could be achieved under the present Government because of their humane approach and the way in which officers of several Departments have been directing themselves to help others. If hardship is involved in meeting the cost of having a telephone—the installation and the calls—the amount of money needed should be made part of the retirement pension and supplementary allowances.

I hope that my hon. Friend the Minister will take that suggestion up with the appropriate Minister and, as the whole House accepts that there is hardship, ask that it be considered, so that a person in need can have his or her supplementary benefit or pension augmented by the amount needed to remove the hardship. That will get rid of the difficulty of having a special fund in the Post Office to meet any concession. In any case, such concessions would be very hard to administer.

I now come to the question of calls. One of the great problems in the small minds of hon. Members opposite is the difficulty they suffer when they lift a telephone. One hon. Member opposite also had a difficulty when he received four letters late and sent them to the Minister. He could not have been very busy that day.

The private subscriber in the United Kingdom making 100 calls pays a third less than a similar subscriber in the United States. The French subscriber pays twice as much. The only country in the world with cheaper telecommunication is Sweden, and its industry is nationalised. The STD service, which we are still extending rapidly, is the cheapest of all the 10 countries in the group which I am taking for comparison.

When we consider performance we must bear in mind that there was a time when people could read and write, and could read the newspapers. That was between 1950 and 1960, but hon. Members opposite will want to forget about it. Let us talk about the situation when the right hon. Member for Wallasey (Mr. Marples) was Postmaster-General. Incidentally, I thought that we had a stranger in the House when he came here today.

Mr. Maurice Orbach (Stockport, South)

" Marples must come ".

Mr. Leadbitter

Between 1958 and 1959—I take just that one year so as to be brief—the rate of growth in the industry was about 1.8 to 1.9 Per cent. What a difference today under a Labour Government! They understand their priorities.

What about call failures? I am sure that hon. Members opposite will remember reading about the telephone service between 1959 and 1963. They will be aware that it was not efficient. We then had an increase in call failures of 4 per cent. in the non-director exchanges, 33 per cent. in the director exchanges and —I do not think that the hon. Member for Acton likes it—

Mr. Kenneth Baker (Acton)

I heard it last week—the same speech.

Mr. Leadbitter

If the hon. Gentleman is tired, I am most hospitable. I have a bed in my room upstairs that he could go to.

Mr. Kenneth Bakerrose

Mr. Leadbitter

I will give way, but I want to finish the sentence.

Call failures in the manned exchanges rose by 55 per cent. On page 10 of the wonderful brief which the Post Office Union has provided for the enlightenment of the House—I have sufficient here to keep us going until the Recess, or right up to the General Election—we see—

Mr. Kenneth Baker

On a point of order. Did I hear the hon. Member correctly? Did he say that a brief had been provided for a parliamentary debate by the Post Office Union and distributed among hon. Members opposite? Is this the service that the union gives to Members? What does the union expect back from Members?

Mr. Deputy Speaker

That is not a point of order.

Mr. Leadbitter

After today's statement by the Prime Minister it shows that we are truthful in dealing with our sources of information.

Against that unfortunate background of call failures, starting from the time of the right hon. Member for Wallasey I will give the following for 1968–69 showing the call failures due to the Post Office. They are: dialled local calls (director) 4 per cent.; dialled local calls (N.D.) 2.5 per cent.; STD (director) 9.3 per cent.; STD (N.D.) 7.7 per cent.; callsviamanual exchange 3.3 per cent.; callsviaauto-exchange, during the day 5.1 per cent., during the evening 4.8 per cent. It appears that we look after the evening staffs very well.

Unless this silly Motion is withdrawn I would be glad to walk into the Lobby and vote against it tonight. For five years the Government have been working towards the creation of a Post Office Corporation. To reach that goal we have had to bring in good management practices and increase the rate of capital investment. We have introduced data processing and transmission and met the challenge of the computer boom. I am glad that the Government had the fore- sight to plan for this through successive Postmasters-General and, in particular, I am glad that my right hon. Friend, who saw the Bill through the House, can come now and tell us about this good rate of progress.

There are still things which need to be done, but the rich, the not so rich, and the poor, will feel the effects of this great service. We note that the increased charges will create problems for some, particularly those on low fixed incomes and those dependent upon the social services. I am sure that we will seek to ameliorate their situation. But the Party opposite must be condemned for trying to interpret progress as inefficiency. That is the only kind of baby they know. They were its creators, they fathered it. Their inefficiency was known throughout the land and in 1964 the electorate had the common sense to say, " Enough of them ".

7.20 p.m.

Mr. James Dance (Bromsgrove)

I am sure that the hon. Member for The Hartle-pools (Mr. Leadbitter) will forgive me if I do not bore the House by going through his two speeches. I do not really know which one to refer to in any case, but I think that the House would have been happier had he finished when he made his first speech.

I do not want to be controversial. 1 am seeking information and hoping to put forward a suggestion which the right hon. Gentleman may find useful for old people. The cost of living is worrying everyone and all around us we can see prices rising. Now we have this 43 per cent. increase in telephone rental, and people on fixed incomes and the old people are in a jam, not only for 999 calls but because without a telephone they will feel cut off from the world. They very much rely upon calls from their families, particularly at weekends.

From an economic point of view it can be said that such a telephone is not an economic unit because it does not originate many calls although quite a lot of calls go to it. In my constituency, in the town of Redditch, the Rotary Club has had a very good idea and installed " S.O.S. " boxes in the windows of old folk's houses. There is a push button connected to the box in most rooms, so that if old people suddenly need a doctor they have only to press the button and the S.O.S. can be seen outside. That system depends on someone passing by and able to help. This goes some way but is not the complete answer. I hope that the right hon. Gentleman will do something to help these old people who need the telephone.

What I suggest is a party line carrying a greater number of subscribers. At the moment one person may share a line with another but if it were possible to put. say, 10 people on one line it would cut the cost of the rental and increase the usage of the line. We are told that old people are able to get their telephone service paid for through the social services, and this is right. Perhaps the Post Office would consider my suggestion as I do not want to put extra burdens on the taxpayer, through the social services. I do feel that my idea of a larger number of subscribers on one line would enable the Post Office, at no more expense to itself, to provide this service, without extra expense to the social services.

In a way old people are rather suspicious of their conversations being overheard, and 1 would imagine that with today's great electronic skill it would be possible to make these l0 lines individually secure, to " wash out " the nine other lines not initiating or receiving a call. However, would it be possible for a 999 call to take priority over the others so that if someone is talking to, say, a nephew on the telephone and another party to the line is taken ill and requires a doctor, that 999 call will take priority over the other?

I was interested in the replies given to Questions yesterday about who can claim the cost of a telephone from the social services. If someone is living on a supplementary pension, then he is entitled to do this. What about others who do not have the pension, but may have low incomes? I know that this is not really a matter for the right hon. Gentleman, but the fullest publicity should be given to the fact that people can get these telephones free of charge. I do not want to put an extra burden on the taxpayer by putting all the costs on to the social services.

Mr. David Crouch (Canterbury)

Perhaps I can help here. I have a letter from the Post Office dated 16th April describing the type of circumstances in which a person could get help. It would be wrong for the House to be misled and to raise the hopes of old people that this provision would be widely applied. The phrase I have here is: where a claimant is living alone, is housebound and would be dangerously isolated without a telephone. Then it is up to the Supplementary Benefits Commission to consider the case. That is rather narrow.

Mr. Dance

That covers the 999 call but not the " lonely " calls of someone who wants to hear from his family at the weekend. This is very important. I have spoken to a lot of elderly people about this, and they feel strongly that they should not be cut off from the rest of the world.

I turn now to wrong numbers. There is no question that there are a lot of them. My number is Sloane 1343 and Peter Jones is Sloane 3434. They nowadays both have the numerical prefix of 730. Many mornings someone rings me up and says " Soft furnishings, please." It is awfully annoying. I say, " Sony, you have got the wrong number," and a few minutes later the same voice comes through again. " Soft furnishings, please." I do not believe that this is entirely idle dialling. I believe that it is bad equipment, perhaps not correctly maintained. Does the unfortunate person who wanted to speak to soft furnishings and who gets me pay for the call or does he have to go through every time to the operator? If so. this must cause chaos. That is possibly why I cannot get the operator when I try to.

Mr. Tom Boardman

I think I have seen somewhere that the amount of revenue which is produced for the Post Office as a result of people getting wrong numbers and not ringing the operator to cancel them is something in the order of £1 million.

Mr. Dance

That may be, but why should they pay for it? I rang up my secretary in the House during the recess from Warwickshire, and I was told to put 4s. 6d. in the box, and to push button A, but when I did so the line went dead, and there was no way of getting back the money. It often happens that I dial a number correctly, but all I hear is a " plonk " and the telephone goes dead. We all agree that we have to pay a fair price for the telephone service as long as we get a proper service, but we do not get it. The service we get does not justify the amount we have to pay.

The Parliamentary Secretary must be rather tired of the number of letters of complaint about postal charges and the postal service which I have sent to him from constituents. One firm which does a lot of business with Gothenberg in Sweden has lost many export orders because of the delay in the delivery of its post this end. The Parliamentary Secretary very fairly dealt with this matter. The first suggestion was that the delay occurred in Sweden, but it was later proved that it was not so, and that the delay occurred after the letters reached this country. A letter bearing a 5d. stamp should have priority. I sent a letter bearing a 5d. stamp last Friday at 11 o'clock in the morning from this House to an address in London not a mile from here. It did not arrive until Monday.

Mr. Neil Marten (Banbury)

My hon. Friend was lucky. A letter which I sent from this House to the chairman of my constituency party took eight days.

Mr. Dance

I can quite believe that. if one pays for caviare one does not expect to be served herring roe.

I pay tribute to the telephone manager in the West Midlands, who does all he can under difficult conditions to look after his customers. I am in no way criticising the staff in the Post Office. I merely criticise the system. As in so many nationalised industries, little thought is given to the consumer and practically no thought to expense.

7.33 p.m.

Mr. Philip Noel-Baker (Derby, South)

I begin by paying tribute to the masterly speeches of the Minister and my hon. Friend the Member for The Hartlepools (Mr. Leadbitter). My contribution will be brief and modest, largely based on personal experience, as was the speech of the hon. Member for Bromsgrove (Mr. Dance).

I support the Minister's statement that in the comparison between the telephone systems of Britain and the United States Britain's is incomparably better. Speaking from personal experience, extending from 1906, when I lived for a year in Pennsylvania to 1970—I have already spent a considerable time this year in New York and Washington—my experience is that by every test—speed, accuracy, right numbers—the British system comes out far ahead.

Speaking from personal experience, 1 have never had a single delay in a letter sent to me of which I have any knowledge. A few weeks ago an American friend of mine was staying at the Connaught Hotel, a little to the North of the House. I wrote a letter to him about arrangements for the following day, and posted it from the House at 9.15 p.m. My plans changed and I wrote him a second letter, which I posted at 11.30 p.m. The next day when we met he expressed amazement that both letters had been on his breakfast table at 8.30 a.m. He said that in New York the letters would have taken two or three days to arrive, if they had arrived at all.

The hon. Member for Howden (Mr. Bryan) referred to the answering of Parliamentary Questions about the Post Office and the postal service. I have had a long experience of answering Questions from the Box on the technical aspects of the operations of industries under national control. For 3½ years, from 1941 to 1945 I was at the Ministry of War Transport, and had to answer to the House for railways, omnibuses, lorry transport services, docks, coasters and deep-sea merchant shipping. For 1½ years I was in the Ministry of Fuel and Power and had to answer for the nationalised industries of coal, electricity and gas.

In those latter years I had a difference of opinion with a friend for whom I had the highest possible regard, the late Mr. Herbert Morrison, Lord Morrison of Lambeth. He was in charge of these matters in the Government and thought that Ministers who were responsible for nationalised industries should not answer Questions on what he called day-to-day administration. Many Ministers followed his instructions and did not answer Questions which could be so described. I explained to him that I differed entirely from his point of view, that I thought it would be to the public advantage if I answered such Questions, that I regarded answering such Questions as an essential part of the system of nationalisation and that if an hon. Member thought it worth while to put down a Question on the Order Paper, it was probable that he had a point of substance in his mind or that a constituent had a complaint either real or imaginary.

I always answered all Questions. I never once refused a Question on the ground that it was about day-to-day administration. In the first four months in which I held office in the Ministry of Fuel and Power I answered 343 Oral Questions and a vast number of supplementaries. I found that the national boards were not embarrassed by my answers, and that they readily gave me the material I required. In many cases the answer which I was able to give led to an improvement in the service, which was well worth while. Therefore, I hope that my right hon. Friend will not adopt the principle of refusing to answer Questions about day-to-day administration.

Mr. Robert Cooke (Bristol, West)

The right hon. Gentleman did great service in answering these Questions, but the trouble nowadays is that one cannot get them on the Order Paper because of the rules. Perhaps he could persuade his right hon. Friend to be more forthcoming. This is a serious point on which we find ourselves in difficulty—

Mr. Deputy Speaker (Mr. Harry Gourlay)

Order. If the right hon. Gentleman were to pursue the point too far he would be out of order too.

Mr. Noel-Baker

I quite agree that Question Time is very different today from those days. Nevertheless, one may put Questions on the Order Paper even though there may occasionally be as many as 150. The mere putting of the Question on the paper obliges the Minister to look into the matter and to prepare his answer. Thereby a considerable part of the benefit which I am arguing can still be achieved even today, although I would favour a considerable extension of the time that is given by the House to answering Question, from hon. Members.

I appeal to my right hon. Friend to think again about his policy for rural England. I put to him the experience of two villages which I know well: one in the south, which has the lovely name of Newton Blossomville, in Bedfordshire; the other in the north, no less romantic, Buttermere, in the Cumberland hills.

Newton Blossomville used to have a post office, but the postmaster gave it up because the remuneration was not enough, and the work had become so heavy. Nobody in the village could be found to take it on. In consequence, Newton Blossomville today has no post office, no telegraph service, no parcels service and no travelling post office. Its nearest bus stop is 1¼ miles away and people with no car who want to go to Bedford to buy stamps cadge lifts from others.

In Buttermere the case is infinitely worse. Buttermere is a famous beauty Spot and tourist centre. It has three hotels, a large youth hostel and various boarding houses and farms which take in visitors. There is vast motor traffic every day. I once counted 40 cars which passed me as I walked down a hill 100 yards long. Thousands of Americans come there, with dollars.

Until February, 1969, Buttermere had a post office run by Mrs. Clarke, but she had long been dissatisfied with the remuneration she received, and she found the increasing burden of work intolerable. She had to give up, and the inducement was so litttle that nobody else in the village would take over. I wrote to my right hon. Friend and asked a if travelling post office could visit twice a week. I was told that this would be impossible, and that there was a stamp machine in the village. Yes, there is, outside what used to be the post office. It would sell I d. stamps if it ever had any stamps in it, but in my experience it has always been empty.

Anybody in Buttermere wanting to buy stamps must go to Lorton, six miles away; anyone wanting to post a parcel must go to Cockermouth, 10 miles away, and parcels are delivered, by a system which I do not rightly understand, from Carlisle, 38 miles away. The hotel people tell me that this causes the gravest difficulty for them in the conduct of their most important dollar-earning business. Conditions such as those in Newton Blossomville and Buttermere, are typical of the rest of rural England and should be improved.

What is the answer? One answer may be to have travelling post offices; but I do not think that would fully meet the need. I believe that the answer is to offer more money to induce people to run the post offices. I should like to offer some figures out of my head, which may be far from the realities but which illustrate my point. Supposing, for instance, the Minister were to induce the corporation to offer postmasters £500 a year more. If that offer were made to 10,000 post offices, it would amount to only £5 million a year. Last year the Post Office made a net profit of £44 million.

We must always remember that many foreigners visit our country. Ernest Bevin and I in 1945 used to fight for the tourist trade, and we were told that it would never bring us in very much money. Today tourists in this country earn us many hundreds of millions of pounds. These people come to see our English countryside, and our postal services are one of the amenities that we should offer them. I beg the Minister to restore these services to what they used to be.

7.47 p.m.

Mr. Stratton Mills (Belfast, North)

The right hon. Member for Derby, South (Mr. Philip Noel-Baker) referred to the speech of his hon. Friend the Member for the Hartlepools (Mr. Leadbitter) as masterly. That perhaps would be a little over-kind. If the House were televised, it would be the kind of performance with which we would not be bored for very much longer.

In this debate we appear to be moving away into an enormous spectrum of matters. I remind the House that this is a Motion of censure on the Government's policy. In view of the attempts which are being made by hon. Members opposite to widen greatly the subject of debate today, I would ask the House to come back to the point.

It will not be lost on those in the Press and public galleries who are watching this debate that hon. Members on the back benches opposite have not been prepared to argue the Government's case, but have trailed many red herrings. Those of us who took part in the Committee stage of the Post Office Bill recall how we occupied 24 sittings and then had a further three days on Report. We thought afterwards that we would not be closely in touch with the detailed workings of the post office for some little while.

But here again the subject of the Post Office has returned to the Floor of the House and rightly so. This Motion has been tabled because of the unacceptable increases which have come so soon after the birth of the Post Office Corporation. But it is not the corporation that is the villain of the piece. It is the Government.

The Minister of Posts and Telecommunications has changed his title, but not his speeches. It was the same old speech —half science fiction and the other half consisted of well-deserved, but somewhat irrelevant, compliments to the staff of the corporation.

Mr. Stonehouse

I assure the hon. Member that there was no science fiction in my speech. There were science facts of positive achievements. Since the Motion refers to a deterioration in services, it was appropriate to make these clear.

Mr. Stratton Mills

I have heard the right hon. Gentleman make the same speech on three occasions. It is the same old speech of the benefits of being able to telephone New York or Tokyo, but it does not deal with the real problems. There is one kind of speech he makes, though he did not make it today, that mentions our newspapers coming into the home via the television set. This is the kind of fanciful, up-in-the-clouds kind of world in which the right hon. Gentleman lives. He does not deal in the realities which ordinary people have to encounter. We have also today the other kind of speech the right hon. Gentleman makes, involving somewhat bogus international comparisons.

I would make a strong complaint to the right hon. Gentleman about the method chosen to make the announcement of these increases. I have before me the Press release which is dated 3rd April, a Friday afternoon when the House was in recess. Was that date of announcement pure coincidence? Is it a pure freak of public relations expertise? We all have our own views on the matter. It is reminiscent of the right hon. Gentleman's attempted announcement about the local radio experiment, when the Government tried to avoid proper discussion in the House by making the announcement about that matter, which they sought to bring in by a written Question.

The only thing that we have not had from this Government is an attempt to introduce price increases on a wet Sunday in August at half past two in the morning, when it is too late for the Sunday newspapers. News management is a shoddy way to bring in price increases, with over £60 million increase to be borne by the consumer.

We have heard the right hon. Gentleman explain these increases. A public corporation can usually present a detailed case for increased prices, which it backs up with massive facts and statistics. But today these were absent. I must remind the Government of the continual increases which have occurred in both posts and telephones under this Administration. It is a heavy price that we pay for Socialism. When we have a Socialist Government, we have price increases.

Although the announcement has been made by a public corporation about price increases the real culprit is the Government. It is the Government who have insisted on an increase in the rate of return on capital from 8½ to 10 per cent. It is the Government which are directly responsible for this price increase, and we must not lose sight of that fact.

Are these price increases justified? The right hon. Gentleman says that the rate of return has been decided at 10 per cent. He said that they had thought about the matter and decided that that was " fair ". But why was the figure fixed at 10 per cent.? Did the right hon. Gentleman take a pin and try to pin on a figure as in the game of pinning the tail on the donkey? I do not understand the reasoning behind the Government's decision. Why was not the figure 9 or 91 per cent., or, for that matter, 11 per cent.? If they ever get back as the next Government, which is unlikely, they may well say that it should be 12 per cent. It appears that it could be any figure.

The other argument used by the right hon. Gentleman is that to argue against these increases would be arguing against the capital programme of the post office. The capital programme is difficult to discover. The right hon. Gentleman, on 23rd March, said in the House that the figure was £2,500 million. The Post Office, in its Press release, said that it was £2,700 million. When my hon. Friend chided the Government about this matter the right hon. Gentleman said that these things roll on. Apparently they roll on at £200 million in a month. This is a Government who pride themselves on watching in detail their budgetary policy. It was an extraordinary explanation, but this is an extraordinary Government.

Mr. Stonehouse

The hon. Gentleman must not confuse the issue. When one is dealing with a future five-year programme, if one moves on a year one is dealing with a future five years, which takes into account an increase in the development programme as compared with the five years one was referring to in the previous year.

Mr. Stratton Mills

I do not agree. We must pursue this matter further. I would remind the right hon. Gentleman of his words in the House on 23rd March, when he said that investment needs over the next five years will exceed £2,500 million."—[OFFICIAL REPORT, 23rd March, 1970 Vol. 798, c. 976.] On 3rd April which is the date of the Press release, one will see that Massive investment is needed—the current five year plan costs £2,700. It is a striking sign of the incompetence of the Government and the right hon. Gentleman especially that between 23rd March and 3rd April the figure has rolled on by £200 million. The only explanation that the right hon. Gentleman can give is that things have changed in a fortnight. The explanation is most unsatisfactory.

We are dealing with an immense capital programme in this public corporation involving over £500 million a year. Is that the right figure? Is it too high, or too low? Those are probably difficult decisions, but I cannot help feeling that there is so much vagueness as between the Post Office Corporation and the Minister that the matter has not been closely examined on modern scientific financial principles.

After price increases the thing that most annoys the public is the frustration in dealing with our telephone service. The Minister seems to be a little out of touch with the problems of ordinary people in dialing, telephone numbers. When he wishes to make a telephone call he probably lifts the telephone and asks a secretary to ask a secretary to ask an operator to get a number for him. He does not come face to face with all the problems which hon. Members on the back benches have with wrong numbers, faults, sometimes a complete blank when dialling, with rude noises in the middle of the dialing, I ask him to try dialing, for himself occasionally, if he wants to understand the frustrations that face a telephone user at present.

The Minister referred to Aims of Industry. That organisation last year undertook a survey of 1,876 calls originating in London and the provinces. It showed a 19 per cent. failure rate. That organisation did not draw any distinct conclusions from that information since there could have been misdialling. and so on, but theEvening Standardcarried out a survey which showed that 15 per cent. of London calls and 32 per cent of outer London calls went wrong. The publicationWhich?,which the Minister could scarcely call a Tory-front publication, showed that 11 per cent. of London calls were going wrong and about 8 per cent. of calls outside London. However, the report and accounts of the Post Office show different figures, namely, that 3½3 per cent. of local calls and 8½3 per cent. of STD calls go wrong. There is a wide divergence in the figures.

My experience—I think that this is shared by the public at large—is that the Post Office underestimates the extent to which calls go wrong. While I join with those who paid compliments to the Post Office staff—I think that they have a remarkably high standard—there is great complacency at the top on this problem.

I end by referring to the most extraordinary incident—I hope that the right hon. Gentleman will be back in his place in a minute—which we saw in this morning's papers. TheFinancial Timessays: Post Office relations with Minister worsen. The Post Office Corporation, puzzled and annoyed by reports.‥The letter is an indication of the worsening relations that have developed between the Corporation and the Ministry ". The Times Business Newssays: Post Office angry that higher charges may be vetoed. There is talk of a " curt note " from Mr. Bill Ryland, the Chief Executive, because he feels that their case for a price increase on postal charges has been rejected on " political grounds."

TheDaily Mailsays: Post Office chief Viscount Hall is having a stand-up row with the Cabinet over higher postal charges. Those three newspapers, to take just a sample, have the same basic story: that there is a major row going on between the right hon. Gentleman and the Post Office Corporation. But the right hon. Gentleman has said in reply to an intervention from me, that there was no curt note. He said that there was no oral complaint from either Viscount Hall or Mr. Ryland and that the relationship is all sweetness and light.

I suspect that the Government always feels that they suffer enormously from being misunderstood, but I think that we will probably find, over the weeks and months ahead, that there is a lot more to this strange little episode. However, I give this warning. I believe that we are building up to another major price increase in the postal service. In our Motion of censure we have focused attention on one aspect of the policy of price increases. It is not a negligible price increase. It is over £60 million. That is why we join in censuring this incompetent Government today.

8.3 p.m.

Mr. Maurice Orbach (Stockport, South)

The hon. Member for Belfast. North (Mr. Stratton Mills) has seen fit to quote from the newspapers and, by innuendo, attack the Post Office and the Minister of Posts and Telecommunications. I recall—I hope that he will—the occasion upon which I quoted a newspaper report in Committee on the Post Office Bill. When I discovered that that report was false, I apologised to the Committee for having quoted it. I trust that when it is discovered that this, like all other innuendos that are circulated in the newspapers about this Government, is declared and found to be false, the hon. Gentleman will be good enough to apologise to the House for making a point about this issue.

At the beginning of his speech the hon. Gentleman referred to the Committee stage and the 33 sittings that we had—

Mr. Stratton Mills

Twenty-four sittings.

Mr. Orbach

—twenty-four sittings— and the number of days that we spent on Report and on Third Reading. 1 thought that the hon. Gentleman was going to refer to some of the debates. But the whole of this afternoon's debate has been devoid of any reference by the Opposition to any of the matters that they declared on that occasion when, as has been pointed out, they were at very great pains to denigrate the whole of the postal services in this country—[HON. MEMBERS: " No."] They were at great pains, at every opportunity, to denigrate our postal services and to declare that our telecommunications services were worse than anywhere else in the world.

The hon. Member for Acton (Mr. Kenneth Baker) delighted in the fact and quoted the American system as being paramount. When 1 referred to my experience in New York, hon. Gentlemen sniggered, or whatever it was they were doing at the time.

Mr. Bidwell

They chortled.

Mr. Orbach

They chortled. I am obliged to my hon. Friend. I do not want to use the wrong phrase.

I do not think that the hon. Member for Howden (Mr. Bryan) was as bad as some of my hon. Friends thought. He made a very good Tory speech, completely critical and without one positive phrase throughout. It is an outrage, even though I acclaim the speech, that 40 minutes or more should be taken in an attempt to damage everything that is being done by a valuable asset of our nation and in no way make a contribution that might be helpful to the nation or to the valuable asset that we own.

I want to discuss the complaint that the hon. Gentleman made against the Government. The only mistake that he made was not blaming the right Government. The hon. Gentleman will recall that in Committee on the Bill I brought to his attention and to that of his hon. Friends the failure of the Government and the Post Office in the past to make up their minds whether we should continue with the Strowger system or change to the Crossbar as a preliminary to going on to wholly electronic equipment. No hon. Gentleman opposite challenged me, because my facts were right. In fact, hon. Members said that it was refreshing to hear somebody talking about the industry and the telecommunications side of the Post Office in realistic terms. It is a fact that there was dithering by Ministers, inability by the Post Office to make up its mind, and failure by the Treasury to provide the funds to enable the Post Office to introduce a more efficient and effective system 10 or 15 years ago.

I paid tribute to the Postmaster-General in 1964 and 1965 who happened to make up his mind about what was to be done in the telecommunications industry in consequence of orders that would be placed by the Labour Government, which had just come into power. No hon. Member can deny that. It is true. Nobody in the industry can deny it.

I want now to join with hon. Gentlemen opposite who have complained about the telephone service. I have good reason. I am exasperated by it. My last quarter's private telephone bill was £67. As an old-age pensioner, I think it is very costly, and it is exasperating that I should not get every call I make when I dial a number. But if I were in the United States I should not be exasperated I should be maddened, not only should I not be able to get on the telephone, but the next-door neighbour would not, because periodically whole districts of Manhattan and the other boroughs of New York are shut down as a result of overloading all over the system.

I know the difficulty in my area. Hon. Gentlemen ought to inquire about it. The difficulty about the area in which I live, which is the old Primrose exchange, is that demand has trebled and the equipment is not only ancient, but dirty, and it needs proper housing. The reason 1 do not get calls, and why I cannot make a call to my neighbour, or to a member of my family, is that there have been years and years of neglect. The real frustration, however, is to be found amongst the men for whom two hon. Members have spoken, the Post Office engineers who were blamed for the " lousy " equipment which was left to them because of insufficient capital investment.

In Committee, I made it clear that I was an export consultant to Plessey's. Generally, I refrained from participating in any debate on telephones because it might have influenced Plessey's business, and my agreement with the company is that under no circumstances shall I assist it in the domestic market. I have tried to help the company in Europe, and in the Middle East, and I am delighted to have done so. I hope that I shall be able to continue doing that for a long time, even though the company's directors may not like one or two things that I want to say.

I am not too happy about the contribution of £21,000 made by Plessey's to the Tory Party. I do not think that it shows foresight. It is a waste of shareholders' money, and I am one of them. I ought, therefore, to have the opportunity of opting out, in the same way as we allow people to opt out of paying the political trade union levy. I ought to have the opportunity of collecting my extra dividend by opting out of paying a political levy to the Tory Party. I hope that in time Plessey's will see the light, and perhaps be one of the first big companies to give, not £21,000 to the Tory Party, but £42,000 to the Labour Party.

Mr. Bidwell

After the disclosures by the Prime Minister today, it seems that the consultant firm being used by the Tory Party is very incompetent indeed, and Plessey's might want its money back.

Mr. Orbach

I am not sure about the agreement with the Tory Party, and I do not want to pursue this issue, as I might be ruled out of order. I merely say that these companies will not get their money's worth. I am sure that very few of the firms which contribute to the Tory Party will get their money's worth. They pay only because of some sort of moral blackmail exerted on them by the old school tie.

Hon. Members

Oh!

Mr. Orbach

I shall be delighted to repeat that outside, when hon. Gentlemen opposite can get their corporation to take it up. I know that moral blackmail is exerted on these firms to pay these contributions. I exclude Plessey's from that comment. I know that this pressure is exerted on some directors with whom I am friendly.

Mr. William Price (Rugby)

My hon. Friend keeps some odd company.

Mr. Orbach

Nye Bevan once said to me, " If you are going in for industry, be a real capitalist. Do not talk about business being bad." Business is always good, and I am sure that it will be good tomorrow.

I thought that the Minister's speech provided a complete reply to all the charges made by the Opposition. It is true that letters go astray. It is true that there k a feeling of exasperation amongst operators of the telephone service and the engineers. Sometimes we demand of them things which they cannot give because of a lack of resources, and sometimes even of staff. I think that when the hon. Member for Howden (Mr. Bryan) and I get to the Coffee Room and have a drink together he will admit that he had to say what he did because it is part of the Tory campaign.

Mr. Bryan

Does the hon. Gentleman think that the Minister dealt with my request for a real breakdown and explanation of this large capital sum? I do not think that we ever had a reply to that important question.

Mr. Orbach

The hon. Gentleman's relationship with my right hon. Friend is such that I am sure he can expect to receive a reply to that question. He could be given a breakdown, but I do not want him to get bogged down on that issue. I do not think that the House ought to, either.

I do not believe that the Post Office Corporation will have sufficient capital to meet the demands that will be made upon it during the next few years. It is almost impossible to plan ahead for four, five, or 10 years. Because of the rapid changes in technology, the position is such that, having planned what will be done tomorrow, one wakes up about an hour or two before dawn to find a new invention on the market, which means that the whole plan has to be abandoned.

I ask the hon. Gentleman to cast his mind back to the century when Caxton introduced the printing of books. The total production of books in the next century, for the whole world, was 100. Today, production in this country alone is 24,000 per annum. Every day more and more books come out, and more and more people are demanding them. The same is true of telephones. The demand will not be satisfied until every home has a telephone, or a video-telephone.

In that famous Committee upstairs we spent two sittings talking about toy motor boats. It shows the mental age of hon. Gentlemen opposite when they start talking about playing with toy motor boats. I do not know whether the brief was supplied by Aims of Industry, by the great research department which has departed, or by the C.B.I. Wherever it came from, it was as much rubbish as the stuff that we have had today.

Our telephone charges are high, but 1 should not like to compare them with those in other countries. The last time that I was in the United States was at Easter, and I hope to go there again at Whitsuntide. Perhaps my telephone bill is high because I make trans-Atlantic calls. My daughter is engaged, and is to be married on 24th May. That is why I shall go to the United States. When I go there I shall refrain from doing one thing which I always do here when I aim to catch an early plane. I ring the operator and ask him to wake me in the morning.

I once did this in New York, and it cost me 1 dollar, 60 cents, or 14s. I think that that was a little extravagant, but perhaps it does not matter quite so much that charges in New York are three times as high as they are here, because many people there have three times the income of people here. Nevertheless, on my income, I object to having to pay 14s. for a tinkle on the telephone and to be told, " It is six o'clock, sir "..

I hope that in future debates on this subject so many comparisons will not be made with what happens in other countries. I am sure that there will not be. We shall rely on innuendo. We shall rely on truncated newspaper stories which later turn out to be false. We shall build up an issue on the basis of spurious letters, just as so much was made of the inquiry by the Post Office into the alleged non-delivery of mail about three or four months ago..

I refer to the spurious attitudes adopted by the party opposite. I hope that, whenever we have similar debates, they will be a little more helpful, not to the Government but to the country, than the party opposite has been today.

8.21 p.m.

Mr. Kenneth Baker (Acton)

It would be charitable to describe this debate as uneven. Some hon. Members have dealt with major issues of how the Post Office should be run. Others have dealt with relatively narrow points of service. The only hon. Member who encompassed both was the hon. Member for The Hartle-pools (Mr. Leadbitter), who spoke for 45 minutes. The pitch which he normally takes up is the period from 6 o'clock to 8 o'clock on a Supply day, when his own benches are rather empty, and he does sterling service for his party. I pay tribute to him. I only hope that, in the drizzle of patronage which is falling over the benches opposite now, the Minister will recommend the hon. Member for ennoblement, so that he can take up his pitch from six to eight in the other place.

I regret that we are having yet another censure debate on the Post Office, but the reason is the Government's own choosing. When the Post Office Bill was in Committee, we constantly pressed that the Minister should occasionally institute a half-day debate off his own bat on the Post Office, to take note of the Post Office accounts once a year. But he said " No, you can debate the Post Office in Opposition time ". So the only opportunity which we now have to debate the largest nationalised industry in the country, whose capital spending is about £2 million every day, Saturdays and Sundays included, is on an Opposition censure Motion. I regret this, since this is one of our greatest industries.

The basic dilemma of the Post Office is that it is two separate parts. First there is the postal side, which is labour intensive and roughly static because its business is not expanding—if anything. it is contracting slightly each year—and largely non-technical. Then there is the telephones and telecommunications side, which is capital intensive, which is expanding rapidly, indeed explosively, and is highly technical. These two are yoked together under Lord Hall, yet they are completely separate operations. The Post Office Corporation's difficulty stems basically from this fact. We recommended in Committee on the Post Office Bill that they should be separated.

That view will be borne out by the events of the next few years. The postal side is running into heavy losses, while the telecommunications made a profit of £50 million last year. The postal side lost about £5 million or £6 million. But the rate of profit on the telephone side is accelerating, and the rate of postal loss is also accelerating. There will be a temptation to which, if this Government does not succumb to it, a future Government of either political complexion may succumb to raid the profits of the one to support the losses of the other. I would strongly oppose this. Telecommunications profits should stay with the telecommunications side, because it will need the money. But there is a danger that the Government may resort to this expedient in an election year.

Last year, postal losses were about £5 million or £6 million. These are some of the items in that figure: parcels, £2 million; printed papers, £3 million; registered overseas post, £500,000; the Giro, still not making a profit, £1½ million; money orders, £2 million; postal orders, £1 million. The Prices and Incomes Board looked into postal charges over a year ago and approved the case for raising the charges for money orders, postal orders and parcels. Nothing has been done on these in the last year. Charges have not been increased; nor have there been any corresponding cuts to reduce these losses in the internal operating efficiency of the Post Office.

This is tantamount to neglect. The forecast postal loss for this year was initially about £6 million, but that has now been superseded by the Prices and Incomes Board forecast of £15 million loss this year—the year ends at the end of July—which will make £26 million loss. I was doing my sums yesterday but I find that they are done on the front page ofThe TimesBusiness News by Mr. Corina this morning. He estimates that the loss next year will be £48 million. I made it £55 million, but I will settle for his figure. There will be an additional loss because of decimalisation of £10 million. That will be altogether an all-time record loss in 1970–71.

A booklet used to be published called " Post Office Prospects ". The last was published a year ago. I do not know whether another will be published this year or whether this, too, has been submerged. Its non-appearance cannot be due to the fact that the Ministry is overworked. Indeed, I cannot imagine what work there is for the Minister in the present set-up. I imagine that he and the Parliamentary Secretary turn up in the office in the morning, and he says, " Well, Norman, what shall we do today? No letters—we have stopped getting letters now that the Post Office has been nationalised. We could go and see the Post Office Corporation. No, they do not want to see us. Perhaps there will be Questions in the House. No, they have stopped being tabled. Perhaps there is a debate. No, there is no debate except in Opposition time, and there is only one adjournment debate a year." So " Norman " says, " What do you think, John? What did you do when Joe was here?" Says the Minister, " Those—those were the days." That is how the Ministry passes its day, so pressure of work cannot be the reason for not publishing this booklet.

Why do we not have this booklet for 1970–71? It was last published in March 1969. Is it discontinued or will one be published this year?

Mr. Stonehouse

The hon. Member will know that it is not appropriate for a corporation to produce such a report.

Mr. Baker

That is regrettable. The Minister goes back on the undertakings he made many times in Committee on the Post Office Bill, that when the Post Office was nationalised the accounts, the budgets and the forecasts of Post Office operations would continue to be published as they were before. Now we do not have that.

It is very convenient politically for the Government not to publish it, because if it were published they would have to put down the forecast loss for the postal services for 1970–71, which I maintain will be more than £50 million. The losses in future years, unless something is done, will be even greater. So I press the Parliamentary Secretary when he replies—I believe it is the first time he has had the opportunity of addressing the House in his new post; he is not often given a run—to tell us exactly what is to be done about this loss. Is it to be met by the taxpayer? There is a case for meeting it by the taxpayer, but let him make it if he wishes.

I think that inevitably the Government will have to face the fact that postal charges will increase. It will be an increase not only in the stamp charges which we read about in the papers this morning, and so far the report inThe TimesBusiness News this morning of Mr. Corina have not been denied by the Government. He has alleged that the Post Office Corporation has asked for an increase of 2d. in the postage stamp price. A Id. increase brings in roughly £25 million, and 2d. would bring in £50 million and wipe out the losses on the postal side of the Post Office.

What is the Government's policy to eliminate this £50 million loss? Make no mistake about it, the loss will be bigger in future years unless something is done. All the Minister was able to say earlier was that there will be productivity increases and that there will be operating efficiencies. How will the Government save £50 million by operating efficiencies? It is an impossible task. The Minister may say, " We shall cut down the second post in the morning."

Mr. Arthur Lewis (West Ham, North)

What second post?

Mr. Baker

The hon. Member for West Ham, North (Mr. Arthur Lewis) says that he does not get a second post. How fortunate for him, because my own consists entirely of circulars and bills and 1 would gladly see it disappear. This was recommended 18 months ago by the Prices and Incomes Board but nothing has been done. Is this one of the savings?

Then there are the post boxes recommended by the Prices and Incomes Board at the end of lanes in country areas and so on to save long journeys. Is this one of the savings? Are we to have cuts in advertising revenue? All these are small change savings, and will not provide £50 million, and the Government should recognise that this evening.

I turn to the telecommunications side of the Post Office. As I see it, the danger is that if the postal side is losing this sort of money the profits of the telecommunications side will be raided to pay for them, and this is something which I oppose most strongly. The reason for this is that the telecommunications side is rapidly expanding. It eats capital in a way that no other business does, to the extent of £2 million a day. It eats it so quickly that when the Post Office Bill went into Committee a year ago the capital programme for Post Office telecommunications was £1,700 million. During the course of the Committee the Minister said it was going up to £2,000 million. As soon as the Bill came out of Committee Lord Hall said, "No, £2,500 million ". Then, a fortnight ago, Lord Hall said, again in a Post Office publication, that the figure was £2,700 million. The Minister did not even know that Lord Hall had said £2,700 million because a few days earlier he had said it was £2,500 million. Is there any telephonic communication between his Ministry and the Post Office Corporation? I doubt it. As I say, it is estimated at £2,700 million and I do not grudge one penny of it.

In the ensuing five or 10 years the amount which the Post Office will have to spend will be much greater. The question arises: how does one finance this? The borrowing requirement for this programme was low, 43 per cent. of the total programme, and the Minister was surprised in Committee when we said that it would be as low at that. The recent charges have increased it to 50 per cent. and the cash generated in turn is to pay for the balance. The line of argument which I have always maintained on this, as the Minister well knows, is that the capital requirements of the Post Office are so great and will be so great that it is important to tap the private capital market to help to meet them.

Hon. Members opposite have flatteringly quoted from my speeches in Committee on the question of denationalisation of the telecommunications side of the Post Office. Denationalisation of the telephone side of the Post Office, as it is at present constituted, is not a practical possibility, but what is a practical possibility is the tapping of the private capital market and running down the complete and total involvement of the telecommunications side in the telephone operations of the country. For example, one way of meeting some of the capital expenditure would be to allow individual citizens to buy their own telephones instead of the Post Office buying the telephones from G.E.C.-Plessey and S.T.C., financing them and holding them in stock, depreciating over a number of years, instead of allowing people to buy them in the way that they buy gas fires, electric fires, refrigerators and so on. That would save a large amount of capital.

Second, I should like to see the private suppliers able to supply business lines down to five lines. At the moment they are allowed to do so down to 50 lines. Again, this would not tie up so much public capital. It would tie up the capital of the suppliers. Cannot the Minister and hon. Members opposite who take an interest in Post Office matters appreciate that? It would tie up not public money but private capital. I know that the Minister, while he may not be entirely sympathetic to this idea, has toyed with it because he has consulted industry—I have tackled him at Question Time on this many times—to see whether industry is interested in it. I believe that it would be, although we have not had any statement from him about it.

Finally, I would like to see some of the more complicated equipment supplied by the companies, instead of being sold to the Post Office, perhaps handled on a care and maintenance basis, again saving capital expenditure of public money.

The point I wish to make mainly concerns the postal charges. I am very concerned that the losses on one side are going to be subsidised by the profits on the other and that once again the telecommunications system will be held back. The Minister will not be facing his responsibilities if he does not say tonight whether there are to be increases in postal charges. I know that this is election year and that the subject is dynamite for the hustings, but we are dealing with a major industry which will make a loss of £50 million within 12 months and the Government do not seem to have a policy for it. There seem to be very poor control and poor links between the Minister and the corporation, and we should be told tonight what the Government's policy is going to be towards the Post Office and how it can reduce or eliminate its loss of £50 million.

8.38 p.m.

Mr. William Price (Rugby)

I get the impression that we have been all through this before, that what we are experiencing is a refined form of " Paki-bashing " and that the Tories will go back to their constituencies at the weekend proud and able to boast that they have given a nationalised industry a parliamentary thrashing.

Those of us who have sat through most of the debate—I apologise for being unable to be present earlier—know that that is not true. But it does not matter whether the thrashing is justified or not, because the Opposition are not interested in the rights or wrongs of the issue. They are interested only in the narrow ideological dogma of people opposed to nationalised undertakings. It is as simple as that.

I do not want to refer to long briefs, whether from the C.B.I. or the trade unions or anyone else, but merely to put in a kindly word for the Post Office. No one will welcome increased charges. I do not. I get the impression, reading the newspapers, that they do not, either. It is a curious fact of life that the newspapers themselves have recently pushed their prices up by between 20 and 25 per cent., the latest in a long series of increases. Listening to some industrialists, I get the impression that the only organisation ever to increase prices is the good old Post Office, and it is not true.

There is a good deal of hypocrisy in the attitude to the Post Office, as there has been for a long time, and some newspapers, as always, lead the way. They are happy to talk about the Post Office and its alleged gross inefficiencies and inadequacies. I worked for newspapers for 10 years and I know that they are among the most incompetent, most idle and most inefficient managements that this country has ever seen and that it ill becomes them to criticise the Post Office. They get considerable pleasure, as always, out of publishing readers letters attacking the Post Office.

There was a classic case inThe Guardianyesterday, headed " Journey's End ". The letter said: On December 31st I posted a letter in the box in Gray's Inn Square, W.C.I. It caught the 12 noon post and was stamped with a 5d. stamp. It was delivered to the addressee in Reading on January 22nd. I am very sorry about that, but it is a variation of " Dear Sir, I heard a cuckoo on Christmas Eve. Can I claim a record? " It would have been more becoming of that lady had she written toThe Guardiangiving a list of all those other letters which have arrived not late. but on time. But she is not interested in that. She is interested in beating over the head a nationalised industry which apparently made a mistake with one letter.

The Tories do that all the time. They make speeches about how they like the Post Office staff, saying that they do not want to criticise them; it is the last thing that they have in mind. The only time that they have a good word to say for anybody engaged in the nationalised industries is at election time. They would put in a good word for the devil at election time if they thought there was a vote in it. The attitude of hon. Members opposite is typical. They want an improved postal service. They want the latest telephone equipment. They demand all sorts of communications facilities. But when prices have to go up to pay for the services they take the line of maximum resistance.

The Tories are the people who intend to slash public expenditure, cut taxes, keep down prices and, hallelujah, on top of all that, improve the service. It would be a remarkable achievement if they could do it. If I thought that they could do it, I would vote for them myself.

What will go through the Lobby tonight will be the usual motley gaggle of miracle men, striking a blow for freedom.

Mr. John Wells

Hear, hear.

Mr. Price

The hon. Gentleman has only just come in. He is not concerned about freedom. There will go through the Lobby hon. Members who want to strike a blow for private enterprise and a blow against the wicked, nationalised monopolistic Post Office.

What is the Opposition's criticism of the Post Office? They are long on prejudice and short on fact, but I did not need to listen to this debate to appreciate that. I believe that of all the nationalised industries the Post Office is by far the most effective and most efficient. Even hon. Members opposite would be hard pushed to deny that. They may say, " So what? That is not saying much." Therefore, let me take the argument a little further. I believe that the Post Office compares very favourably with almost any large industrial or commercial complex in this country.

Hon Members opposite complain about a letter which occasionally arrives late. I ask them to bear one thing in mind. This morning the Post Office handled more letters before breakfast than I.C.I. will probably handle in the next 10 years. Hon. Members opposite cannot deny that. The occasional letter may be lost or may arrive late. What is unusual about that? The Post Office has never claimed any divine righteousness. It makes mistakes; I do not deny that. But of one thing I am absolutely certain: the Post Office gets the blame for a lot it has not done. Let me give one or two examples.

It would be interesting to know how often the Post Office is abused for failing to deliver letters which were never written. There are plenty of firms which are by no means puritanical in this respect. How often is the Post Office blamed for failing to deliver items which were either badly packed or inadequately addressed? Those of us who go around the post offices at Christmas know only too well that every post office has its agony pile of broken parcels with children's toys, dozens—[interruption.] The hon. Member for Acton (Mr. Kenneth Baker) puts his hand on his heart. By the way he has performed today I should have thought that he would be hard pushed to find his heart.

I do not want to bring tears to anybody's eyes, but there are hundreds of letters which will never be delivered. Who gets the blame—the poor old Minister. As always, Father Christmas has let the child down. How often is the Post Office blamed for the apparent late delivery of letters written during the weekend but not posted until later in the week? I know this from my own correspondence. A lot of letters which are written on Sundays arrive either on Wednesdays or Thursdays. When I look at the postmark I find that they were posted the day before. It is curious that people are not posting letters the day after they are written.

The Post Office gets the blame for wrong dialling. We have heard a lot about wrong dialling today. I wonder how much of that is due to people poking their fingers in the wrong holes. I do not suppose we shall ever know, but it would be interesting to carry out a survey.

The criticism of the Post Office is not confined to Britain. I recently had the good fortune, through the business of the House, to spend a little time in America and in Malawi. It would be difficult to find a greater contrast between two countries—poverty in the one, wealth in the other. They have one thing in common —nobody has a good word to say for the Post Office.

A business friend of mine—I have known him for many years—has recently emigrated to New Zealand, one of his main reasons being that the " inefficient " Post Office here was helping to ruin his business and he wanted to go to a country where they knew how to run such things. I have recently had a letter from a correspondent saying that he could not stand the post office in New Zealand, so he was off to Japan. No doubt he would soon have a similar complaint there.

All those countries are fortunate in that they do not have to put up with an amateur opposition who cannot differentiate between a political philosophy and a genuine desire to improve a State service.

There are problems, of course. In my area, with high wage rates, staffing is a serious problem. Many of my constituents cannot get a telephone. There is a substantial waiting list. I have said for a long time—in this place nobody takes any notice—that it does not improve the temper of my constituents to see very expensive advertisements urging them to use their non-existent telephones after 6 p.m. It causes much ill-feeling. I believe that much of the Post Office advertising is wrongly conceived, is directed to inappropriate areas, and is guaranteed to arouse hostility among even the most sympathetic of people.

I hope that I am objective. I think that I can see the faults and problems in the Post Office. I also appreciate the worth of an organisation which is giving a good service at one of the cheapest prices in the world. Hon. Members opposite have no such objectivity. They are going through one of their periodic rituals. They should be treated on that basis tonight. I do not want to be unkind or spiteful, but if I had to choose between the whole lot of them and my village postwoman I have no doubt who I would choose.

Hon. Members opposite always use their own experience of inefficient postal services. That is perfectly justified. The curious thing is that when discussing this subject all those who have had all the letters go astray are on the opposite side of the House and all those who have had no letters go astray are on this side of the House. I have been in the House for four years.

Mr. John Wells

Too long.

Mr. Price

When I have to look at the hon. Gentleman, it seems too long.

I know of one of my letters which did not reach the address to which it was sent, although obviously there may have been others. Two people have written to me asking, " Why the hell did you not reply? " I never received their letters in the first place. There may have been more of that type, also.

I shall support the Government tonight with great enthusiasm, in the knowledge that, though the Post Office may not be perfect, it is much better than anything hon. Members opposite would care to admit. I shall follow my right hon. Friend into the Lobby in a happy and contented frame of mind tonight, which is more than I can say for my state of mind following many debates in the House.

8.50 p.m.

Mr. Tom Boardman (Leicester, South-West)

I was intrigued when the hon. Member for Rugby (Mr. William Price) said that in certain conditions he might feel inclined to vote for the Opposition. In view of his past experience, I hope that we can count on his being more reliable than we have heard in accounts of what happened in Committee.

We have heard of the hon. Member's postal experience in his constituency. The Rugby post office serves my home. If the hon. Member refers to the postmaster there, he will find that on many occasions when mail has been dispatched from this House on a Friday and not delivered on Saturday the postmaster has very helpfully arranged for his staff to go through it on a Sunday so that important documents may be sorted and specially delivered before Monday.

The hon. Member asked what we on this side of the House want. We want value for money. The main censure can be laid at the door of the Minister and of the Government in their policy on this. The attitude of the Government has come through in speech after speech by hon. Members opposite. It is " Look how much we have spent! " They have boasted of the amount of money they have poured in, or committed to be poured in, but not of the value they are getting out.

I was very sorry that the Minister—who is always fair—when referring to the past five years and the five years which preceded them, referred to current prices rather than using the measure of constant prices usually adopted in such comparisons. If he had taken account of inflation a very different figure would have been shown. It was unfortunate that he should claim credit for what actually has been the failure of the Government in producing inflation and rising prices.

The criticism here is also an exposure of the dangers of monopolies. This reiterates the fears expressed in this House on many occasions, and constantly in the Committee, on the Post Office Bill as to what would happen with a monopoly situation in the telecommunication services when they lack competitiveness from the private sector. We have heard this afternoon of variations in forecasts of capital expenditure. Originally the figure quoted in March, 1968, was £1,100 million for three years for telecommunications. Then in discussion of the Post Office Bill in Committee the figure went up to £2,000 million for a five-year period, in March. 1970, to £2,500 million, and then, in April, we had this additional £200 million " rolled over " in a matter of a week.

Why are there these changes? Why has £700 million been added since January, 1969, when the Bill was in Committee? I repeat the questions put by my hon. Friend the Member for Howden (Mr. Bryan). Where is the breakdown of the figures? On what is the money being spent, and what studies have there been of each project? What analysis has been done? In its report the P.I.B. made reference to the unfortunate lack of opportunity the board had fully to investigate the capital investment programme, which was such a large feature of its appraisal.

Paragraph 58 of the board's report said: The appraisal of investment projects is one of the most important fields in the industry where modern decision-making techniques can be employed and we regret that we have not been able to give it as much attention as it deserves. The measurement of the return expected from these large sums is critical. It must be explained and justified in greater detail. We have £700 million added in a year without any explanation of where it is going.

I was pleased to note in the Post Office accounts that £6 million is going to the postal services in the City of Leicester. This is going to a parcels office, a telephone exchange and a new cable. I am delighted for the sake of Leicester that this should be so. But how was that investment appraised? What types of test were there? Were the modern, more sophisticated investment appraisals applied, and with what result? We have to pay the bill, and we wonder whether the claimed increase in efficiency which will no doubt be achieved from that expenditure could not have been achieved by spending £3 million instead of £6 million. I give that just as an example.

We wonder whether the £2,700 million had to be spent, or whether adding up the cost of all the original plans and multiplying them by the increased cost factor resulting from inflation gives that fantastic total. We have no yardstick. There is no competition. If someone in industry decides to build a factory or warehouse he knows that if he is overelaborate in his designs, if he has the wrong kind of layout and is extravagant he will finish up with something that cannot compete with that which has been built on efficient lines.

There is not the same discipline in the Post Office monopoly. Therefore, it is vital that the tests applied in evaluating these programmes should be of the most modern kind, and that we should be able to have a judgment upon them.

The original estimate of £2,000 million, which I think was probably first announced in about January of last year during our Committee proceedings on the Post Office Act, was made at a time when the return required was 8½., per cent. The return required now is 10 per cent., and I again echo the question of my hon. Friend the Member for Belfast. North (Mr. Stratton Mills): " Why 10 per cent.? " Why should it not be 11 per cent. or 9 per cent., or whatever figure we choose?

The Minister said that he thought it was fair and that it was the figure which had to be compared with the sort of return industry may require. He quoted various returns on investments in sections of private enterprise. He again made a no doubt innocent mistake, with no intention of misleading the House, I am sure. In comparing the returns required by industry—17½ per cent., I think, in the case of G.K.N.—with the 10 per cent. which is the aim here, he completely overlooked the tax factor. The 17½ per cent. subject to tax must be related to a 10 per cent. which bears no tax.

The comparison is not as it was presented. It cannot be said that because industry looks for a 17½ per cent. gross return on its investment a return of 10 per cent. tax-free to the Government is reasonable. The Minister looks puzzled. If I have not made my point clearߞ

Mr. Stonehouse

The point I was trying to bring out was that the self-financing ratio of private industry is on average about 85 per cent. That is the comparison which I think bears on the subject we are discussing.

Mr. Boardman

The self-financing is a quite different point. I hope that I am not doing the right hon. Gentleman an injustice in saying that he made that other point in his speech. At least one hon. Member opposite gave the return on capital expected by private industry as justification for requiring a 10 per cent. return by the Post Office. The comparison is not fair because the 17½ per cent. return quoted as required by industry is subject to tax and that should be borne in mind when we compare it with the 10 per cent. return which is the aim of the Post Office under the Government's new policy. The distinction is not one which can be rightly made in the form in which it was presented.

Why was the figure of 10 per cent. accepted? The funds are assured in this case. They are supplied by national loans. There is no need to go into the market place and give equity together with convertible loan stocks or fixed interest stocks to fund expansion.

The Government are in a position—unfortunately, I believe, for the purposes of public control of expenditure—of being able to provide the cash. Of course, it is right that they should do so at the going rate. But what consideration has been given to the various factors which would fix that rate, and is it sufficient?

It is not enough for the right hon. Gentleman just to say that he decided that the rate of 10 per cent. was fair.

The original investment forecast of £2,000 million in five years was made at a time when the target return was 8½ per cent. The target has now risen to 10 per cent. What review was made of the investment programme and the forecast in the light of the different target that was set? We would have expected that if money is to cost more, if it is necessary to earn more on the capital one puts out, one will probably put out less. If the projects have been fully, carefully and properly costed, something which just qualified with an 8½ per cent. return would not qualify when the return is put up to 10 per cent. Many of the projects no doubt included a degree of automation, of reducing the wage and salary bill, and to that extent the Government were justified in investing the capital if the savings on the labour bill was sufficient to cover the earnings target of 8½ per cent. on that capital sum.

This is a very important question, and I hope that the Parliamentary Secretary will deal with it. When the target was put up from 8½ per cent. to 10 per cent., were all the major capital projects reviewed, and if so, with what effect? It is remarkable that any such review, if one was made, has resulted in the capital requirement going up from £2,000 million to £2,700 million, when on every conventional yardstick and guide line it would have come down.

The problem here is that when the discipline of the market place is not applicable even tighter procedures are required than apply to industry as a whole. They just do not exist here, and I cannot help suspecting that there has been a deterioration in the checks and controls applying throughout the Post Office—it is difficult to be specific about this—in the way in which vast capital sums are approved with apparently very little benefit to the user. No one is happy about the telephone service; no one is happy about the postal service.

Of course there are more telephones, of course the waiting list has come down, but that must be related to the vast amount of money that has been spent and the mounting losses of the postal services, to which my hon. Friend the Member for Acton (Mr. Kenneth Baker) referred. All of this must cause the greatest concern. What we want, and this goes right to the nub of this censure debate, is value for money, and this is not what we are getting. It is not what the public feels it is getting, and it is not what we shall get from the vast capital programmes that have been put down on sheets of paper with no check or scrutiny possible by hon. Members who are responsible, ultimately, to the taxpayer and the public.

My second question is: should the money be raised in this way? Should it be raised by putting up telephone and postal charges or in some other way? I belong to a school of thought that considers that services of this nature should be paid for by those who use the services. If there is, as there will be, a certain section of the community which for one reason or another is unable to pay those charges and requires a subsidy, that subsidy should be debited to the proper account, whether it be the social services, housing, or whatever. We should follow the principle of the user footing the bill.

My criticism is that we must make sure that the bill is a proper one, with regard to the total capital involved, ensuring that it has gone through the proper disciplines and scrutiny and that economies cannot be made without sacrificing efficiency. That being so, the bill should be paid by those who use the services but at the same time we must see that there are generous and proper subsidies provided for those who need the service but cannot pay for it, those subsidies being charged to the appropriate fund. What we want is to see value for money, and that we have not been getting.

9.6 p.m.

Mr. Ian Gilmour (Norfolk, Central)

I would have thought that the Opposition's Motion was virtually uncontroversial, as is indicated by the fact that there is only one hon. Member opposite present who is not paid to be there, or who does not have a definite duty to be there. The fact that hon. Gentlemen opposite have no particular wish to oppose the Motion has also been demonstrated by their speeches. As my hon. Friend the Member for Belfast, North (Mr. Stratton Mills) pointed out, very few, if any, of the speeches of hon. Gentle- men opposite have been directed anywhere near the Motion.

My hon. Friends have certainly proved every facet of the case and I will endeavour to reinforce what they have said, to establish every proposition and to add charges of Ministerial incompetence and governmental chicanery. There is no dispute as to the hardships that these charges will cause. Every hon. Member has had letters about this. I have and my hon. Friend the Member for Birmingham, Edgbaston (Mrs. Knight) read out many such moving letters. Unfortunately, there are many people in the position of her constituents. Although a proportion will be helped by supplementary benefit, a great many will not, either because they do not qualify, because they do not know about it, or because they are too proud to apply.

My next charge is that these increases will put up industrial costs. That, also, is indisputable. We saw yesterday that industry estimates that inflation is adding £1,600 million to costs this year. These charges will, naturally, add to that. Between October, 1964, and December, 1969, the prices of nationalised industries rose by 29..5 per cent., while the retail price index rose by 24.6 per cent. Both have risen considerably since then, the nationalised industries that much faster.

My next proposition is a deterioration in the services. Despite the Minister's habitual complacency everyone knows the services are not as good as they were. As my hon. Friend the Member for Bromsgrove (Mr. Dance) his pointed out, there are many wrong numbers. He is always being rung up and asked for " soft furnishings ", which he resents. People think that they are dialling Peter Jones.

The Post Office report and accounts attributes nearly all faults to misdialling or the recipient of calls being engaged or out, but anyone who has ever had available at the same time two telephones knows that that excuse is eyewash. If one has two telephones and gets an engaged signal on one, one may easily get straight through on the second.

Both theEvening Standardand theWhich? reports are much more in line with the general experience of the everyday telephone user.Which?found that London was slightly worse than it was four years ago, and the proportion of local calls going wrong had risen from 9 to 11 per cent.Which?noted that more local calls go wrong in Paris, but then, Paris is noted for many things but not necessarily for its telephone system.

The same is true for the postal service. The official story simply does not tally with everyday experience. My hon. Friend the Member for Liverpool, Wavertree (Mr. Tilney) said that his firm now has to use couriers; that is surely a comment on the service which he gets. The Post Office's claims that 95 per cent. of first-class mail was delivered the next day was tested by theDaily Mailand rebutted.

The right hon. Gentleman's term of office has been notable for his publicity achievements and for the exaggerated claims that he has made, but in the Post Office report and accounts for 1968–69 he excelled himself. Paragraph 3 says: The inauguration of the two-tier mail system was accompanied by a glare of publicity and controversy, reminiscent of the early years of the Rowland Hill penny post. What a grotesque and arrogant comparison. The great achievement of Rowland Hill was to lower postal charges and make them uniform. The introduction of the penny post was a brilliant and imaginative step whose consequences for the country were wholly beneficial. The introduction, on the other hand, of the two-tier system was a shabby expedient designed to conceal a price rise, and it led to great inefficiency and enormous inconvenience.

Mr. Stonehouse

Will the hon. Gentleman please finish reading the paragraph?

Mr. Gilmour

It goes on: This made the task of managers more difficult. Towards the end of the financial year the controversy subsided as the public accepted that without the new letter service, charges would have been higher and the reliability of the next-day delivery service more difficult to maintain.

Mr. Stonehouse

Does not that prove the point that at the beginning there was much controversy, most of it artificially contrived for political reasons from the Opposition side of the House in censure debate after censure debate, which has now died? Most people accept that the two-tier system is a very good system; so much so that in the censure debate today not a single voice has been raised against the system. This proves the point.

Mr. Gilmour

If the right hon. Gentleman thinks that he is like Rowland Hill, he is the only man in the country who does.

Mr. T. L. Iremonger (Ilford, North)

I wish to be fair to the Minister. Will he not find out if we can now send a postcard as cheaply as we can send a letter?

Mr. Gilmour

I am grateful to my hon. Friend. On page 8 of the Post Office report and accounts, on the introduction of the two-tier letter service, we read: These changes were followed by a fall of about 4 per cent in letter traffic. On page 18 we read that the introduction of the two-tier letter service was one of the reasons for the increase in the number of man-hours used to handle mails. Thus, the two-tier service produced a fall in traffic, an increase in the labour force and a much worse service; and the right hon. Gentleman talks about Rowland Hill! In spite of what he has just said, he knows that the service is still causing considerable inconvenience, to business firms in particular.

In my district, the second post often arrives before the first. This means that letters sent by second-class mail are more likely to arrive before those sent by first-class mail. Often the matter is purely academic, because both the posts arrive long after I have left the House. Surely, even the right hon. Gentleman would agree that it should be an elementary requirement of a rational postal service that the first delivery should arrive before the second delivery, and that the second delivery should arrive after the first delivery.

Since the alleged reason for the increase in telephone charges is the bigger return on capital and the need for self-finance, I should like to look at the Minister's use of figures, about which my hon. Friend the Member for Leicester, South-West (Mr. Tom Boardman) spoke, so that the House can decide for itself the quality of the Minister's financial judgment and how much reliance can be placed on what he says when he mentions figures.

The right hon. Gentleman said in Committee: I told the Committee that currently the figure for financing from internal resources is 54 per cent. In fact, it is 53 per cent. for the first half of 1969 and 1970. It has been a lower figure in past years, and the figure overall for the five years which I have been describing is about 50 per cent."—[OFFICIAL REPORT,Standing CommitteeD. 27th February, 1970; c. 914.] The right hon. Gentleman said, on the Floor of the House: In this financial year the telecommunications business is financing 43 per cent. of its activities from its own resources, and, overall, the figure is 39 per cent. We are expecting, over the whole five year period, to finance about 50 per cent. of the £2,000 million development programme from our own resources."—[OFFiciAL REPORT, 26th March, 1969; Vol. 780. c. 1684.] Then the right hon. Gentleman told us that increasing the target from 81 to 10 per cent. would …lift the rate of internal financing from 34 per cent. to 52 per cent. over the next five years."—[OFFICIAL REPORT, 23rd March, 1970; Vol. 798, c. 976.] Originally, the figure was to be 53 per per cent.: it then became 39 per cent. and went down to 34 per cent. Then, lo and behold, as a result of these increases it will be back to 52 per cent. which, by coincidence, is the number the Minister first thought of.

Surely these wild fluctuations in the Minister's figures show, first that his an other people's forecasts are ludicrously bad, and, secondly, that the percentages he bandies about with such apparent expertise are meaningless and subject to every sort of miscalculation and Treasury whim.

What we are dealing with is not returns on capital, but another example of the Government monkeying about with the Post Office to put a better face on its economic policy. These rises are due entirely to the Treasury's requirement and insistence on putting up the rate from 8½ to 10 per cent.

Why were these rises not included in the Budget? We have it on the authority of the Prime Minister himself that telephone charges are an instrument of budgetary policy. Let us go back to 20th July, 1966, the first day of the decline and fall of the Labour Government. It was the day when the Prime Minister became so suddenly and intimately concerned with Post Office affairs that he filled no fewer than 12 columns of HANSARD with the details of the increases in Post Office charges which were to take £21 million out of the economy. The reason was simple. At that time he was trying to impress his foreign paymasters with the extent of his deflationary measures. He favoured them with such interesting information that he was putting up the price of an alarm call from 9d. to ls.

But this year the problem was different. Just as last year the Chancellor announced increases in National Insurance benefits without telling us what they were to cost, so this year he wanted his Budget to seem as little mean as possible. It would sound much better to say he intended to give back £220 million to the much-robbed taxpayer than to say that he would merely give back rather more than £100 million. Moreover, he wanted to he able to say that nobody would be worse off as a result of his Budget.

In consequence, the right hon. Gentleman omitted from his Budget statement the rise in the employer's contribution and omitted any mention of the rise in telephone charges. Of course, these telephone charges were just as much a part of his economic measures as they were of the Prime Minister's measures on 20th July, 1966. But the Chancellor wanted to he a giver and to let other Ministers he the takers. Indeed, the Chancellor's colleagues must sometimes feel rather like Bernard Shaw's Candida, when she complains to her pious and pompous husband: When there is money to give, you give it. When there is money to refuse, I refuse it. This is not just a question of the Chancellor taking the pickings while leaving the dirty work to his colleagues. After all, it is the Chancellor himself who has said that he should be judged throughout the year and not by the one day of his Budget. By skilfully putting up telephone charges a week before his Budget, the Chancellor made himself seem much more generous than he was. Thus, a married man with two children earning the average industrial wage will, excluding the future avalanche of price increases which are to come, be £7 17s. 6d. a year better off as a result of the Budget. But if he has a telephone he will be precisely £2 17s. 6d. a year better off.

In his Budget speech, the Chancellor said: I therefore propose to introduce a Budget which will in no way, either directly or in- directly, do anything to raise prices."— [OFFICIAL REPORT, 14th April, 1970; Vol. 799, c. 1243.] That was completely misleading. The week previously he had carefully raised prices, directly and indirectly, by £65 million.

There is, however, even more jiggerypokery in these increases. The present situation is that the telecommunications service, in the words of the Minister, is "…a profitable and rapidly expanding business."—[OFFICIAL REPORT, 23rd March, 1970; Vol. 798, c. 976.]

Yet we see the Government coming to the House and telling us that they are to put up telephone charges, but they say nothing about putting up postal charges. In other words, they think that, electorally, a decrease in taxes is worth a rise in telephone charges, but is not worth a rise in postal charges.

They camouflage the naked political nature of what they are doing by announcing that they have decided on a 10 per cent. return on Post Office capital. I have dealt with that matter, but it will be obvious to the House that the Government could have put up telephone charges by any figure they wanted, merely by deciding whatever rate of return on capital they thought expedient. In fact, the electricity and gas industries have to return a rate of 8 per cent

We read in the daily newspapers that the Government have vetoed an increase in the price of letter postage. I thought that the Minister chose his words rather carefully this afternoon. He said that that was merely speculation. There was no denial. Anyway, we hope that the journalists concerned will not be prosecuted under the Official Secrets Act

In 1968–69, the postal services of the Post Office made a loss which has now been revised to £26 million. Since then wage settlements have added £41 million to the wage bill. The right hon. Gentleman said £26 million this afternoon. I think that he was confusing that figure with the loss on the postal services.

Mr. Stonehouseindicated dissent.

Mr. Gilmour

Anyway, my hon. Friend was told yesterday by the Post Office that the right figure was £41 million.

We know from the Report of the National Board for Prices and Incomes that id. on the stamp means £25 million of revenue. So, even if we ignore the 2 per cent. that the postal services are meant to earn on their expenditure, at least 2d. on the stamp would be necessary if the Government were behaving with the financial rectitude that they claim, however implausibly, over telephones. But, as my hon. Friend the Member for Acton (Mr. Kenneth Baker) pointed out, and as we continually said in Committee, the telecommunications side is being used to subsidise the postal side.

It is reported that the Minister has refused to sanction the postal increases because he is not satisfied that the efficiency of the service is as great as it should be, or that restrictive practices have been entirely eliminated. But what makes the right hon. Gentleman think that the telecommunications side is as efficient as it should be and that there are no restrictive practices there? Nothing whatever.

The Government, as usual, are concerned solely with electoral considerations. To make derisory tax reductions they are prepared to clobber the telephone user, but they dare not do the same to the letter writer. In 1968, the Minister claimed great courage for putting up postal charges. He did not talk about courage today.

The House, or some hon. Members, will have seen that it is now cheaper for firms to have their circulars posted in Holland than in England. These circulars arrive here as quickly from Holland as they would if they were posted here, and they are cheaper. One of the companies using these Dutch facilities is theNew Statesman.What a marvellous epitaph for this Socialist Government! They have even driven Socialism abroad. Inflation and inefficiency in Britain are so great that a paper seeking to extol the virtues of the Government and the virtues of Socialism cannot afford to use the facilities of this country. Instead, it has to proselytise for its Socialist readers from the safe and economic distance of Holland.

These increases in telephone charges have been fraudulently presented, and their incidence has been decided by electoral caprice, not by financial honesty. They will hurt many vulnerable people. They will lead to hardship, not to greater efficiency. They will lead to higher costs, not to a better service. They are the consequence of a galloping inflation, and they will have the effect of spurring on that inflation still faster. They are a monument to a Government bankrupt of ideas and bereft of power. That is why we are voting against them tonight.

9.30 p.m.

The Parliamentary Secretary to the Ministry of Posts and Telecommunications (Mr. Norman Pentland)

Apart from the two Front Bench speeches to which we have listened, this has been a rather exciting debate at times. We have heard passionate speeches from hon. Members on both sides.

Like my right hon. Friend, I deplore the terms of the Motion. It has been obvious to us for some time that the Opposition are scraping the barrel when it comes to finding subjects for their Supply day. We see this more and more. The hon. Member for Norfolk, Central (Mr. Ian Gilmour) talked about political caprice. I understand that in high Tory circles, in the Carlton Club, and so on, he is an expert in caustic wit. The Opposition are scraping the barrel to find subjects to debate on their Supply days to enable them to make political points against the Government.

The Motion is in three parts. The hon. Member for Norfolk, Central had a much wider and more experienced audience behind him and alongside him than did his hon. Friend the Member for Howden (Mr. Bryan) when he opened the debate. The hon. Member for Howden, on this important Motion of censure, was rather muted. He was very quiet, and made what I thought was the shortest Front Bench speech that I have listened to since becoming a Member of this House many years ago. It took him 15 minutes to deploy what was expected to be a vicious attack on the Government because of the increased charges.

I was amazed when I listened to the hon. Gentleman, because part of the Motion refers to the deterioration in Post Office services. My right hon. Friend demolished that accusation, and I shall develop this aspect of postal services a little later. I am a comparative newcomer to this Ministry, but one thing which has impressed me probably more than anything else in the short time that I have been here and have studied what is involved, is the outstanding achievement of the Post Office over the years, and its realistic expectations for the next decade. It is a service of which this country and this House should be supremely proud.

A number of points have been made during the debate. The Post Office will pay particular attention to them, because it is taking a great interest in this debate. [Laughter.] I cannot understand why hon. Gentlemen opposite are laughing. Knowing the Opposition as I do, I can understand them laughing and indulging in ridicule at about four minutes to ten, but I have not reached that stage yet. At least let me try to reply to some of the points which have been made.

No substantial argument has been put forward to say that in present circumstances a return of 10 per cent. is unreasonable for an industry like telecommunications in its present state of explosive expansion. [An Hort. MEMBER: " Of what?"] I am not saying that; it was one of the hon. Gentleman's hon. Friends who talked of the " explosive expansion " of telecommunications. The hon. Gentleman has not been in during the debate. He should ask his hon. Friend what he means by explosive expansion in telecommunications before he sits his backside down on the benches opposite.

The figures quoted by my right hon. Friend could not and should not be misunderstood. They show that a higher return would have been theoretically justifiable than the 10 per cent. which some people have said is probably unreasonable. Nor has any argument been sustained against the rate of self-financing of rather more than 50 per cent. for this business, with its vast demands on capital resources. All experience of private industry and of telephone services overseas supports this assumption. There has been no suggestion that the Post Office is wrong in seeking to frame charges so as to eliminate uneconomic services and secure better utilisation of its capital plant. So I take it that the general case for this increase in telecomm unications charges, subject to examination of details by the users' council, is, if not universally accepted, at any rate con-elusively proved.

It is not customary to publish details of capital investment programmes of nationalised industries. We have given an impressive amount of information about those programmes, including future projections in the White Paper on Public Expenditure. The purpose of the programme as described in the White Paper is to provide for expansion of the system and improve the quality of the service. I am not prepared to go any further than that tonight.

The hon. Member for Howden referred to the Prices and Incomes Board in two contexts. First, he asked why these increases had not been referred to the board, and, second, contrasted them with the board's forecast in its 1968 report that no further increases would be necessary. The answer to the first point is that, as stated in the recent White Paper on prices and incomes, it is no longer a general rule that increases in prices by nationalised industries should be referred to the Prices and Incomes Board. References are now considered on their merits in each case. In this case, because the increases arise almost wholly from a Government decision to increase the target rate of profit, and because the board has so recently undertaken a major investigation of the Post Office, no reference was considered necessary.

The hon. Member for Norfolk, Central enjoyed himself on the subject of posts: he had a fine time on that. He poured scorn on the fact that his Aunt Fanny and other people did not get letters in time. But that is not fully justified when one considers the position seriously. Of course we hear of isolated complaints, even numerous complaints, about individual failures, but we should remember that 11,000 million letters are posted and delivered each year in this country.

When attempting to assess the situation as a whole a very different picture emerges. The complaints made against the Post Office by Aims of Industry were shot down in flames by my right hon. Friend, as the Post Office did the complaints made against it by Aims of Industry.

However, some helpful suggestions have been made by hon. Members of both sides of the House—including the hon. Member for Ross and Cromarty (Mr. Alasdair MacKenzie)—and the suggestions for the better management of the services which are now the responsibility of the Post Office will, I am sure, be noted by the corporation. There are problems here, and top priority is given to dealing with them.

Next, an issue raised by almost every hon. Member was telephones for the elderly and the disabled. My hon. Friends spoke of the difficulties that some elderly and infirm people and others are experiencing and how the charges will affect them considerably.

Both my right hon. Friend and I sympathise and agree with some of the complaints which have been advanced today. I can only repeat what my right hon. Friend said on this point. The Post Office must pursue commercial policies. It is not a welfare organisation and has no means at all of assessing the physical or financial needs for telephones of the kinds of people whose position is causing concern. As has been said, provision is made under the Supplementary Benefits scheme for people in real need.

1 shall certainly draw the attention of the Ministers in the Department of Health and Social Security to the need to publicise these provisions and consider generally what has been said today about their practical application. I do not think that, in the context of this debate, and understanding the position of the Post Office, I can be reasonably asked to go beyond that.

Some hon. Members have criticised the Post Office for advertising the fact that telephone calls are cheaper at certain times of day. I hardly need reply to that, because at least one hon. Member opposite has spoken in favour of advertising and my hon. Friend the Member for Newcastle-under-Lyme (Mr. Golding) has spoken so well in its defence. But I remind the House that telephone equipment has to be provided to meet peak conditions. At off-peak times it can stand idle, and advertising the cheaper off-peak rates is amply repaid by the increased usage and revenue which results.

The Prices and Incomes Board, in its 1968 Report, recommended the Post Office to make special efforts to educate the public about the cheaper call charge periods. This is obviously of benefit both to the public and to the Post Office. The public knows that it can have a cheaper call. The Post Office relieves the peak pressure on its equipment and increases the revenue-earning use of its equipment off-peak.

The hon. Member for Howden referred to the need for improving marketing techniques. Here, the board is bringing with it the expertise and experience of outside industry. In this, advertising has a necessary part to play.

The hon. Member for Ross and Cromarty, for whom we all have deep respect, made what I thought was a somewhat contradictory contribution. On the one hand, he was pressing for more capital expenditure to be provided in order to improve the communications to remote areas such as his own, and on the other was complaining about increased charges which, as my right hon. Friend has demonstrated, are necessary to pay for them. His aims are not compatible in that sense.

Mr. Alasdair Mackenzie

I have listened to the hon. Gentleman with great interest but still cannot see where the contradiction is. These are separate functions.

Mr. Pentland

I am afraid that it is a contradiction. On the one hand, the hon. Gentleman wants to improve and extend the services, which means more capital expenditure, while on the other he complains about increased charges. But the money for the extension of these services has to come from somewhere. [Interruption.] The House must make up its mind on whether it wants the public. through increased taxation, to pay for all this, or whether the capital expenditure is to come from the sources now proposed.

My right hon. Friend the Member for Derby, South (Mr. Philip Noel-Baker) raised an important point on the scope of Parliamentary Questions. He spoke from great experience in these matters. Now that the Post Office is a nationalised industry, I am sure he will agree that its board must be treated in exactly the same way as the boards of other nationalised industries. That is not to say that there is no room for argument about the general practice in the House as it applies to nationalised industries. Indeed, this was dealt with in the recent report of the Select Committee on Nationalised Industries. But the time to consider that aspect is not in this debate. I take the point he made, however.

The hon. Member for Acton (Mr. Kenneth Baker) spoke of a temptation to raid the telecommunications profit in order to meet reported losses on the postal services. He said that the Government or the Post Office Board would have that temptation. The Government have no intention of allowing that to happen. I am not prepared tonight to go into the financial position of the postal services in detail because, as I have said, this will need considering when a decision is taken on postal charges, which will also cover the charges for parcels and remittance services which he referred to.

Mr. Kenneth Baker

The hon. Gentleman has not really answered the point I put. The postal side of the Post Office is running at an annual loss of about £50 million. It will be about £26 million up to the end of the financial year in July and is running at an annual rate of £50 million loss. I ask the hon. Gentleman to explain, if he is able, what the Government intend to do about it. Are they prepared to see this loss going on or will they take action to stop it? If so, what action?

Mr. Pentland

The hon. Gentleman is trying to divert the debate completely. I fully understand the point he has made. He referred to the suggestion that the Government would at some time hive off the more profitable part of the industry. I could make a long political speech about what the Opposition did in hiving off certain parts of nationalised industries for the benefit of private enterprise. The Government have no intention of allowing the Corporation to do as the hon. Gentleman wants. [Interruption.] If we have to have a debate about the various sides, profitable or unprofitable. of particular nationalised industries, we want a full day's debate, because the Government have many pertinent things to say on that issue.

Mr. Bryan

Would the hon. Gentleman reply to the very straight question which I asked the Minister: how much is the Post Office losing per week on its postal services?

Mr. Pentland

Why should we give that? The hon. Gentleman can have that information, but in this debate, when we are defending a nationalised industry against an Opposition Motion, it is not for me or my right hon. Friend to give day-to-day losses, or hourly or weekly losses, by a nationalised industry, any more than it would be rational for me to ask any hon. Member opposite who is a shareholder or a director-general in private industry what his company was losing day by day or week by week. Information such as that for which the hon. Gentleman asks can be obtained by question and answer in the House, as the hon. Gentleman knows very well.

I said earlier that—[Interruption.]

Mr. Speaker

Order. It has been a quiet debate so far.

Mr. Pentland

I said earlier that I would deal with the achievements of the Post Office. I now turn to overseas telecommunications.

Mr. Dance

Would the hon. Gentleman say something about the suggestion concerning shared lines? It was a reasonable suggestion to increase the number of people sharing lines in order to help old people and so decrease their rents.

Mr. Pentland

I am glad that I gave way to the hon. Gentleman. I listened to almost half his speech. My right hon. Friend was impressed with his suggestion, and we will look into it.

The hon. Lady the Member for Birmingham, Edgbaston (Mrs. Knight) poured unjustified scorn on the Post Office's overseas telecommunications services. I do not think that her hon. Friends who have spoken about the needs of the business community would agree with everything that she said. We should pay tribute to the Post Office's achievements in overseas telecommunications and to the contribution made by these services to our export drive. Our Post Office engineers are recognised throughout the world as being among the world's leaders in submarine cable design, construction and laying. It is right that we in the House should pay tribute to the skill and dedica- tion which at all times they bring to their work.

High reliability transistors made by the Post Office Research Department have made possible new submarine cable systems providing trans-ocean telephone circuits at a cost of about half that of the earlier systems. The Post Office system is connected to the European mainland by 25 submarine cables and a major microwave radio link across the Straits of Dover. Four 1,300-circuit submarine cables are to be laid across the North Sea from the United Kingdom in the next four years. The Post Office has a submarine cable to Canada, two cables and a part interest in a third to the United States and a substantial interest in the cable to Portugal and South Africa [Interruption.]

Hon. Members opposite must listen to this. They imply in their Motion that the services offered by the Post Office Corporation to the people have deteriorated. So they should listen to an account of something which has been done by the Corporation and of which the public should be proud. [Interruption.] The hon. Member for Banbury (Mr. Marten) does not want to listen. He arrived only a quarter of an hour ago. Prior to that he had heard none of the speeches in the debate.

Mr. Marten

On a point of order. Mr. Speaker. The hon. Gentleman has made an inaccurate statement. I entered the Chamber at nine o'clock, having been out all day on the Estimates Committee. I ask the hon. Gentleman to withdraw his remark.

Mr. Pentland

I am not concerned about the hon. Gentleman's Estimates Committee. I am concerned about his conduct night after night when a Motion of censure is being debated. He enters the Chamber about a quarter of an hour before the debate is due to end and makes disgraceful comments.

Mr. John Mendelson

On a point of order, Mr. Speaker. Last night you told me that it was advisable to listen to the debate. Will you please now make the same point to those on the other side of the House who are interrupting my hon. Friend?

Mr. Speaker

I am grateful to the hon. Member for Penistone (Mr. John Mendelson) for striking a note of order in the debate. He is right.

Mr. Pentlandrose—

Hon. Members

Withdraw!

Mr. Pentland

I will not withdraw anything.

Mr. Tilney

Will the hon. Gentleman say something about vandalism, which is what is preventing public telephones in cities from operating?

Mr. Pentland

I gave way to the hon. Gentleman because he made a constructive speech. I accept that vandalism is a serious problem. We will draw it to the attention of the Post Office. No doubt the hon. Gentleman's comments will be noted outside the House.

I should like to have said much more about the solid achievements of the Post Office service. I have been denied the opportunity, for a number of reasons. In the short time which has been available to me I have done my best to answer questions. I repeat that I believe that the Motion is not only deplorable, but absolutely unjustified. Of course, the corporation has problems to contend with and difficulties to face, but I assure the House that the corporation is trying.

in every possible way to overcome these problems and is giving high priority in the process.

This public corporation offers the public a tremendous service year in, year out, a service of which the people can be proud, a service that has been provided for us by thousands of dedicated men and women who are engaged in this great industry. I invite my colleagues to demonstrate their faith in and appreciation of the service rendered by this great public corporation by completely rejecting the Opposition's Motion.

Mr. Kenneth Bakerrose—

Mr. Speaker

Order. I thought that the hon. Gentleman had already spoken. He can make only one speech in the debate.

9.59 p.m.

Mr. Marten

I wish to take the opportunity albeit at this late hour, to condemn the Parliamentary Secretary—I hope that I may have his attention, because I shall direct my remarks to him—to condemn the hon. Gentleman—

Question put:—

The House divided:Ayes 237, Noes 286.

Division No. 100.]	AYES	[10.0 p.m.
Alison, Michael (Barkston Ash)	Bullus, Sir Eric	Fisher, Nigel
Allason, James (Hemel Hempstead)	Burden, F. A.	Fortescue, Tim
Amery, Rt. Hn. Julian	Campbell, B. (Oldham, w.)	Foster, Sir John
Archer, Jeffrey (Louth)	Campbell, Gordon (Moray &Nairn)	Fraser,Rt.Hn.Hugh(St'fford &Stone)
Astor, John	Carr, Rt. Hn. Robert	Fry, Peter
Atkins, Humphrey (M't'n &'n)	Channon, H. P. G.	Galbraith, Hn. T. G.
Awdrey, Daniel	Chichester-Clark, R.	Gibson-Watt, David
Baker, Kenneth (Acton)	Clark, Henry	Gilmour, Ian (Norfolk, c.)
Baker, W. H. K. (Banff)	Clegg, Walter	Gilmour, Sir John (Fife, E.)
Batsford, Brian	Cooke, Robert	Glover, Sir Douglas
Beamish, Col. Sir Tufton	Cooper-Key, Sir Neill	Glyn Sir Richard
Bell, Ronald	Cordle, John	Goodhart, Philip
Bennett, Sir Frederic (Torquay)	Corfleld, F. V.	Goodhew, Victor
Bennett, Dr. Reginald (Cos. & Fhm)	Costain, A. P.	Gower, Raymond
Berry, Hn. Anthony	Craddock, Sir Beresford (Spelthorne)	Grant, Anthony
Biff en, John	Crouch, David	Grant-Ferris, Sir Robert
Biggs-Davison, John	Crowder, F. P.	Grieve, Percy
Birch, Rt. Hn. Nigel	Cunningham, Sir Knox	Gurden, Harold
Black, Sir Cyril	Currie, G. B. H.	Hall, John (Wycombo)
Blaker, Peter	Dalkeith, Earl of	Hall-Davis, A. G. F.
Boardman, Tom (Leicester, S.W.)	Dance, James	Hamilton, Lord (Fermanagh)
Body, Richard	Davidson,James(Aberdeenshire, W.)	Hamilton, Michael (Salisbury)
Bossom, Sir Clive	d'Avigdor-Goldemid, Sir Henry	Harris, Frederic (Croydon, N.W.)
Boyd-Carpenter, Rt. Hn. John	Dean, Paul	Harrison, Brian (Maidon)
Boyle, Rt. Hn. Sir Edward	Dodds-Parfcer, Douglas	Harrison, Col. Sir Harwood (Eye)
Braine, Bernard	Doughty, Charles	Harvey, Sir Arthur Vere
Brewis, John	Crayson, G. B.	Harvie Anderson, Miss
Brinton, Sir Tatton	du Cann, Rt. Hn. Edward	Hastings, Stephen
Bromley-Davenport, Lt. -Col. Sir Walter	Eden, Sir John	Hawkins, Paul
Brown, Sir Edward (Bath)	Elliot, Capt. Walter (Carshalton)	Hay, John
Bruce-Gardync, J.	F:Hiott,R.W.(N'c'tle-upon-Tyne,N.)	Heald, Rt. Hn. Sir Lionel
Bryan, Paul	Emery, Peter	Heseltine, Michael
Buchanan-Smith, Alick(Angus,N&M)	Errington, Sir Eric	Higgins, Terence L.
Buck, Antony (Colchester)	Farr, John	Hiley, Joseph
Hill, J. E. B.	Mawby, Ray	Silvester, Frederick
Hogg, Rt. Hn. Quintin	Maxwcll-Hyslop, R. J.	Sinclair, Sir George
Holland, Philip	Maydon, Lt.-Cmdr. S. L. C.	Smith, Dudley (W'wick & L'mington)
Hordern, Peter	Mills, Peter (Torrington)	Smith, John (London & W'minster)
Hornby, Richard	Mills, Stratum (Belfast, N.)	Speed, Keith
Howell, David (Guildford)	Miscampbell, No*man	Stainton, Keith
Hunt, John	Mitchell, David (Basingstoke)	Steel, David (Roxburgh)
Hutchison,Michael Clark	Monro, Hector	Stodart, Anthony
Iremonger, T. L.	Montgomery, Fergus	Stoddart-Scott, Col. Sir M.
Irvine, Bryant Godman (Rye)	Morgan, Geraint (Denbigh)	Summers, Sir Spencer
Jenkin, Patrick (Woodford)	Morgan-Giles, Rear Adm.	Tapsell, Peter
Jennings, J. C. (Burton)	Morrison, Charles (Devizes)	Taylor, Sir Charles (Eastbourne)
Johnston, Russell (Inverness)	Mott Rariclyflo. Sir Charles	Taylor.Edward M.(G'gow,Cathcart)
Jones, Arthur (Northants, S.)	Munro-Lucas-Tooth, Sir Hugh	Taylor, Frank (Moss Side)
Jopling, Michael	Murton, Oscar	Temple, John M.
Joseph, Rt. Hn. Sir Keith	Neave, Airey	Thatcher, Mrs. Margaret
Kaberry, Sir Donald	Nicholls, Sir Harma-	Thorpe, Rt. Hn. Jeremy
Kershaw, Anthony	Noble, Rt. Hn. Michaei	Tilney, John
Kimball, Marcus	Onsiow, Cranley	Turton, Rt. Hn. R. H.
King, Evelyn (Dorset, S.)	Orr, Capt. L. P. S.	van Straubenzee, W. R.
King, Tom	Orr-Ewing, Sir Ian	Vaughan-Morgan, Rt. Hn. Sir John
Kitson, Timothy	Osborn, John (Hallam)	Waddington, David
Knight, Mrs. Jill	Page, John (Harrow, W.)	Wainwright, Richard (Colne Valley)
Lambton, Antony	Pearson, Sir Frank (Clitheroe)	Walker, Peter (Worcester)
Lancaster, Col. C. G.	Percival, lan	Walker-Smith, Rt. Hn. Sir Derek
Lane, David	Peyton, John	Wall, Patrick
Langford-Holt, Sir John	Pike, Miss Mervyn	Walters, Dennis
Lawler, Wallace	Pink, R. Bonner	Ward, Christopher (Swindon)
Legge-Bourke, Sir Harry	Pounder, Rafton	Ward, Dame Irene
Lewis, Kenneth (Rutland)	Powell, Rt. Hn. J. Enoch	Weatherill, Bernard
Lloyd, Rt.Hn. Geoffrey (Sut'nC'dfield)	Price, David (Eastleigh)	Wells, John (Maidstone)
Longden, Gilbert	Prior, J. M. L.	Whitelaw, Rt. Hn. William
Lubbock, Eric	Quennell, Miss J. M,	Wiggin, Jerry
McAdden, Sir Stephen	Ramsden, Rt. Hn. James	Williams, Donald (Dudley)
MacArthur, lan	Rawlinson, Rt. Hn. Sir Peter	Wifson, Geoffrey (Truro)
Mackenzie, Alasdair(Ross&Crom"ty)	Renton, Rt. Hn. Sir David	Winstanley, Dr. M. P.
Maclean, Sir Fitzroy	Rhys Williams, Sir Brandon	Wolrige-Gordon, Patrick
Macleod, Rt. Hn. lain	Ridley, Hn. Nicholas	Woodnutt, Mark
McMastcr, Stanley	Ridsdale, Julian	Worsley, Marcus
MacMMlan, Malcolm (Western Isles)	Robson Brown, Sir William	Wright, Esmond
McNair-Wilson, Michael	Rossi, Hugh (Hornsey)	Wylie, N. R.
McNair-Wilson, Patrick (NewForest)	Royle, Anthony	Younger, Hn. George
Maddan, Martin	Russell, Sir Ronald
Marples, Rt. Hn. Ernest	Scott, Nicholas	TELLERS FOR THE AYES:
Marten, Neil	Sharpies, Richard	Mr. Jasper More and
Maude, Angus	Shaw, Michael (Sc'b'gh & Whitby)	Mr. Reginald Eyre.
Maudling Rt. Hn. Reginald
NOES
Abse, Leo	Brown, Hugh D. (G'gow, Provan)	Dunn, James A.
Albu, Austen	Brown, R. W. (Shoreditch & F'bury)	Dunnett, Jack
Allaun, Frank (Salford, E.)	Buchan, Norman	Dunwoody, Mrs. Gwyneth (Exeter)
Alldritt, Walter	Buchanan, Richard (G'gow, Sp'burn)	Dunwoody, Dr. John (F'th & C'b'e)
Allen, Scholefield	Butler, Herbert (Hackney, C.)	Eadie, Alex
Anderson, Donald	Butler, Mrs. Joyce (Wood Green)	Edwards, Robert (Bilston)
Archer, Peter (R'wley Regis & Tipt'n)	Callaghan, Rt. Hn. James	Edwards, William (Merioneth)
Armstrong, Ernest	Carmichael, Nell	Ellis, John
Ashley, Jack	Carter-Jones, Lewis	English, Michael
Ashton, Joe (Bassetlaw)	Castle, Rt. Hn. Barbara	Evans, Albert (Islington, S.W.)
Atkins, Ronald (Preston, N.)	Concannon, J. D.	Evans, Fred (Caerphilly)
Atkinson, Norman (Tottenham)	Conlan, Bernard	Evans, loan L. (Birm'h'm, Yardley)
Bacon, Rt. Hn. Alice	Corbet, Mrs. Freda	Faulds, Andrew
Bagier, Gordon A. T.	Crawshaw, Richard	Fernyhough, E.
Barnes, Michael:	Cronin, John	Frinch, Harold
Barnett, Joel	Crosland, Rt. Hn. Anthony	Fitch, Alan (Wigan)
Baxter, William	Crossman, Rt. Hn. Richard	Fle1onerrRt.'Hn,SirEric(Islington,E.)
Bence, Cyril	Dalyett, Tarn	Fletcher, Raymond (likes ton)
Bennett, James (G'gow, Bridgeton)	Davidson, Arthur (Accrington)	Ftetchet Ted(Darlington)
Bidwell, Sydney	Davies, E. Hudson (Conway)	Foiey, Maurice
Binns, John	Davies, G. Elied (Rhondda, E.)	Foot, Michael (Ebbw Vale)
Bishop, E. 'j.	Davies, Dr. Ernest (Stretford)	Ford, Ben
Blackburn, F.	Davies, Rt. Hn. Harold (Leek)	Forrester, John
Blenkinsop, Arthur	Davies, S. 0. (Merthyr)	Fowber, Gerry
Boardman, H. (Leigh)	Delargy, H. J.	Fraser, John (Norwood)
Booth, Albert	Dell, Rt. Hn. Edmund	Freeson, Reginald
Boston, Terence	Dempsey, James	Gardner, Tony
Bottomley, Rt. Hn. Arthur	Dewar, Donald	Garrett, W. E.
Bradley, Tom	Diamond, Rt. Hn. John	Ginsburg, David
Bray, Dr. Jeremy	Dickens, James	Colding, John
Brooks, Edwin	Dobson, Ray	Gordon Walker, Rt. Hn. P. C.
Broughton, Sir Alfred	Doig, Peter	Gray, Dr. Hugh (Yarmouth)
Brown, Rt. Hn. George (Belper)	Driberg, Tom	Greenwood, Rt. Hn. Anthony

Gregory, Arnold	McCann, John	Price, William (Rugby)
Grey, Charles (Durham)	MacColl, James	Probert, Arthur
Griffiths, Eddie (Brightside)	MacDermot, Niall	Randall, Harry
Griffiths, Will (Exchange)	Macdonald, A. H.	Rankin, John
Gunter, Rt. Hn. R. J.	McElhone, Frank	Rees, Merlyn
Hamilton, William (Fife, W.)	McGuire, Michael	Roberts, Albert (Normanton)
Hamling, William	Mackenzie, Gregor (Rutherglen)	Roberts, Rt. Hn. Goronwy
Hannan. William	Mackle, John	Roberts, Gwilym (Bedfordshire, S.)
Harper, Joseph	Mackintosh, John P.	Robertson, John (Paisley)
Harrison, Walter (Wakefield)	McMillan, Tom (Glasgow, C.)	Robinson, Rt. Hn. Kenneth(St.P'c'as)
Hart, Rt. Hn. Judith	McNamara, J. Kevin	Roebuck, Roy
Haseldlne, Norman	MacPhcrson, Malcolm	Rogers, Ceorge (Kensington, N.)
Hattersley, Roy	Mahon, Peter (Preston, S.)	Rose, Paul
Hazell, Bert	Mahon, Simon (Bootle)	Ross, Rt. Hn. William
Healey, Rt. Hn. Denis	Mallalipn E. L.(Bigg)	Ryan, John
Heffer, Eric S,	Mallalieu,J. P. W.(Huddersfield,E.)	Shaw, Arnold (Ilford, S.)
Herbison, Rt. Hn. Margaret	Mapp, Charles	Sheldon, Robert
Hilton, W. S.	Marks, Kenneth	Shore, Rt. Hn. Peter (Stepney)
Hobden, Dennis	Marsh, Rt. Hn. Richard	Short, Mrs. Renee(W'hampton,N.E.)
Hooley, Frank	Mason, Rt. Hp. Roy	Siikin, Hn. S. C. (Dulwich)
Horner, John	Maxwell, Robert	Sillars, J.
Houghton, Rt. Hn. Douglas	Mayhew, Christopher	Silverman, Julius
Howarth, Robert (Bolton, E.)	Mellisn, Rt, Hn. Robert	Slater, Joseph
Howell, Denis (Small Heath)	Mendelson, John	Small, William
Howie, W. Hoy, Rt. Hn. James	Mikardo, lan	Snow, Julian
Huckfield, Leslie	Milne, Edward (Blyth)	Steele, Thomas (Dunbartonshire, W.)
Hughes, Rt. Hn. Cledwyn (Anglesey)	Mitchell, R. C. (S'th'pton, Test)	Stonehouse, Rt. Hn. John
Hughes, Hector (Aberdeen, N.)	Moonman, Eric	Strauss, Rt. Hn. John
Hughes, Roy (Newport)	Morgan, Elystan (Cardiganshire)	Summerskill, Hn. Dr. Shirley
Hunter, Adam	Morris, Alfred (Wythenshawe)	Symonds, J. B.
Hynd, John	Morris, Charles R. (Openshaw)	Taverne, Dicto
Irvine, Rt. Hn. Sir Arthur	Morris, John (Aberavon)	Thomas, Rt. Hn. George
Jackson, Colin (B'h'se & Spenb'gh)	Moyle, Roland	Thomson, Rt. Hn. George
Jackson, Peter M. (High Peak)	Mulley, Rt. Hn. Frederick	Thornton, Ernest
Jay, Rt. Hn. Douglas	Murray, Albert	Tinn, James
Jenkins, Hugh (Putney)	Neat, Harold	Tomney, Frank
Johnson, Carol (Lewisham, S.)	Newens, Stan	Tuck, Raphael
Jones, Dan (Burnley)	Noel-Baker, Rt. Hn. Philip	Urwin, T. W.
Jones, Rt. Hn. Sir Elwyn(W.Ham,S.)	Norwood, Christopher	Varley, Eric G.
Jones, J. Idwal (Wrexham)	Ogrien, Eric	Wainwright, Edwin (Dearrte Valley)
Jones, T. Alec (Rhondda, West)	O'Halloran, Michael	Walden, Brian (AH Saints)
Kelley, Richard	Oram, Bert	Wallace, George
Kenyon, Clifford	Orbach, Maurice	Watkins, David (Consett)
Kerr, Mrs. Anne (R'ter & Chatham)	Orme, Stanley	Watkins, Tudor (Brecon & Radnor)
Kerr, Russell (Feltham)	Oswald, Thomas	Wells, William (Wafsall, N.)
Latham, Arthur	Owen, Dr. David (Plymouth, S'tn)	White, Mrs. Eirene
Lawson, George	Padley, Walter	Wilkins, W. A.
Leadbitter, Ted	Page, Derek (King's Lynn)	Willey, Rt. Hn. Frederick
Ledger, Ron	Paget, R. T.	Williams, Alan (Swansea, W.)
Lee, Rt. Hn. Frederick (Newton)	Palmer, Arthur	Williams, Clifford (Abertillery)
Lee, Rt. Hn. Jennie (Cannock)	Pannell, Rt. Hn. Charles	Williams, Mrs. Shirley (Hitchin)
Lee, John (Reading)	Park, Trevor	Willis, Rt. Hn. George
Lestor, Miss Joan	Parker, John (Dagenhatn)	Wilson, Rt. Hn. Harold (Huyton)
Lever, Rt. Hn. Harold (Cheetham)	Parkyn, Brian (Bedford)	Wilson, William (Coventry, S.)
Lewis, Arthur (W. Ham, N.)	Pavitt, Laurence	Winnick, David
Lewis, Ron (Carlisle)	Pearson, Arthur (Pontypridd)	Wood burn, Rt. Hn. A.
Lipton, Marcus	Peart, Rt. Hn. Fred	Woof, Robert
Lomas, Kenneth	Pentland, Norman	Wyatt, Woodrow
Loughlin, Charles	Perry, George H. (Nottingham, S.)
Luard, Evan	Prentice, Rt. Hn. Reg	TELLERS FOR THE NOES:
Lyons, Edward (Bradford, E.)	Price, Christopher (Perry Barr)	Mr. Ernest G. Perry and
Mabon, Dr. J. Dickson	Price, Thomas (Westhoughton)	Mr, James Hamilton.
McBride, Neil