HC Deb 25 June 1973 vol 858 cc1108-10
2. Mr. Golding

asked the Minister of Posts and Telecommunications if he will make a further statement on details of the reductions in investment he has to announce following the Chancellor's statement of public expenditure retrenchment.

5. Mr. Ewing

asked the Minister of Posts and Telecommunications if he will make a statement indicating in detail what projects will be affected as a result of the Government decision to make a cut of £30 million in the Post Office investment programme.

7. Mr. Roger Whit

asked the Minister of Posts and Telecommunications if he will make a statement on his discussions with the Post Office on projected savings in capital expenditure in 1974–75.

Sir J. Eden

I would refer hon. Members to the replies I gave to the hon. Member for Pontypridd (Mr. John) on 11th and 18th June.—[Vol. 857, c. 231.]

Mr. Golding

Is the right hon. Gentleman aware that this blanket type of cut is unsatisfactory from the point of view of planning in the Post Office? Will he tell us what possible use this will be to the British economy? Further, will its harmful effects be found mostly in increasing the waiting lists or not improving the standard of service?

Sir J. Eden

The cut should be seen as part of the total amount of cuts in public expenditure. It is the total amount that has the impact on the management of the economy, not just the telecommunications and postal services.

The hon. Gentleman should not exaggerate the amount of the cut in this particular sector. It is £30 million out of a £662 million programme, which is 4.5 per cent. The bulk of it will fall on the telecommunications side and, of necessity, on the short lead time operations which will have a direct impact on subscriber operations. Therefore, the impact is more likely to be felt at the customer end of the line than elsewhere.

Mr. White

May I ask my right hon. Friend for an assurance that any such reductions in investment will not affect telecommunications between London and North Kent, where the service is already inadequate and frustrating?

Sir J. Eden

The main point to be reassured about is that the announced reduction in public expenditure will not affect the programme of modernisation that I announced on 18th April, but some plans for improving the telephone service will inevitably have to be deferred.

Mr. Ewing

May I ask the right hon. Gentleman about the postal side of posts and telecommunications? Is it correct that the decision has been taken to cut back on postal mechanisation? If so, how can the industry plan its long-term future if the future is to be put in jeopardy? Is he aware that the postal service is working under severe pressure and is in grave danger of complete collapse in view of the way that the Government are toying about with it?

Sir J. Eden

There will be some impact on the postal mechanisation programme, but this will be largely a matter of spreading forward the time for the introduction of the new installations. As the hon. Gentleman knows, discussions have been taking place between the Post Office and the union on this issue. I have no doubt that the union is equally anxious to ensure the maximum degree of efficiency in the postal delivery service. Obviously this presupposes a growing extent of the introduction of mechanisation.

Mr. Tom King

May I ask my right hon. Friend whether the capital expenditure programme of the Post Office was on schedule anyway? Are these changes in expenditure more in the nature of budgeting revisions than actual cuts?

Sir J. Eden

Mechanisation has been deferred marginally because of the discussions that are still taking place between the Post Office and the Union of Post Office Workers. It is important to recognise that though the programme is spread forward over a large number of years the deferment in the earlier period can be fully absorbed within the context of the total programme.

Mr. McCrindle

Has not the time come for a truly radical reappraisal of capital investment by the Post Office? Does the right hon. Gentleman agree that, at a time when further increases in postage are being predicted, the time has arrived for the Post Office to install central points in urban and suburban areas where people can pick up their own letters, thereby allowing our scarce numbers of postmen to be allocated to rural areas where this is not possible?

Sir J. Eden

That is probably the sort of point that could be taken into consideration by the Post Office Users National Council as a result of the references both by the Post Office Board and myself on behalf of the Government.