HC Deb 28 July 1977 vol 936 cc1142-55

1.20 a.m.

Mr. Ian Cow (Eastbourne)

The late Mr. Aneurin Bevan once warned his colleagues about the danger of quoting from their own speeches or articles. I wish to start what I have to say by quoting briefly from a pamphlet written, earlier this month by the hon. Member for Eastbourne. This was what he wrote: There are still those who believe that the economic and industrial performance of the United Kingdom and the choice available to the citizen will be improved if only we can transfer more power and more decision making to the politicians, but the number is dwindling fast. There has never been a time when the Tory alternative has had a more sympathetic audience. I endorse those words, and it is against that background that we are debating tonight the Post Office monopoly and the way in which the Secretary of State exercises his power to vary that monopoly.

I suspect that among the elements of the nation's life that are most misunderstood is the monopoly position of the Post Office. We are permitted to deliver newspapers and charge a fee for so doing. We are permitted to deliver parcels and charge a fee for so doing. We may deliver beer or milk or toothpaste or tooth brushes, but he who delivers a letter, save with the consent of the Secretary of State, is guilty of an offence.

This is spelt out, and in the starkest terms, in the Post Office Act 1969—an Act which was passed by the precursor of the present Administration, another Socialist Government. However, with my customary fairness I must concede that the 1969 Act reproduced in all material respects Section 3 of the Post Office Act 1953, which was of course passed by a Conservative Administration. It is right that I should point out that I was not in the House in 1953 and that if I had been I hope that I should have voted against the 1953 Bill and would have addressed the Standing Committee at great length on the infamous Section 3, or Clause 3 as it was when the Committee was considering it. Hon. Members may laugh, but I am being perfectly honest in saying that I was not here in 1953, nor, I think, was the Minister or the hon. Member for Walsall, South (Mr. George).

We should dwell shortly upon Section 3(2) of the 1953 Act. It spells out that it is unlawful to deliver a letter save in certain very special circumstances. Here they are. It is worth reading them out, because the actual wording of these exceptions goes far to underline the gulf between the real world and the world of mythology that is inhabited by Ministers.

First: the conveyance and delivery of a letter personally by the sender thereof. So if we wish to deliver a letter to one of our constituents, or if someone wishes to deliver a letter to his girl friend personally, that is exempt. There will be no £5 fine and no danger of prosecution.

Second: the sending, conveyance and delivery of a letter by means of a private friend who himself delivers that letter to the addressee. Again, we have an exemption.

Third: the sending, conveyance and delivery of a letter concerning the private affairs of the sender or addressee thereof by means of a messenger sent for the purpose by the sender of the letter. Fourth: The sending, conveyance and delivery otherwise than by post of any document issuing out of a court of justice. Fifth: the sending and conveyance of letters from merchants who are the owners of a merchant ship or commercial aircraft. Sixth: the sending, conveyance and delivery of letters by land by means of a common carrier, being letters concerning and for delivery with goods carried by him. We are tonight to consider two aspects of the Post Office monopoly: first, the general question whether there should be a monopoly, and, second, the particular case raised by my right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) at Question Time on Monday last.

Is it not fortunate that we should be having this debate on the Post Office on the very day when this extremely expensive report, the Post Office Report and Accounts 1976–77, has been placed in our hands, published by Her Majesty's Stationery Office and, no doubt, delivered here by private carrier so as not to infringe the Act? I shall read from page 17: The number of inland letters handled in the year fell by 4.3 per cent. compared with 1975–76. This"— The report goes on—

was a disappointing result for a year in which basic letter prices were stable and determined efforts were made to boost business by marketing and selling. Of course, the report was written before the increase in charges last month. It relates to a year in which we had the old postage rates, and if we had a disappointing result in the number of letters sent last year we may predict with some certainty that there will be a disappointing result in the number of letters sent in the current year.

I refer to the report of the Post Office for 1976–77 because it is intensely relevant to the whole subject of the monopoly. If it be permitted to deliver newspapers through the free enterprise system, if it be permitted to deliver parcels through the free enterprise system, and if it be permitted to deliver milk and beer through the free enterprise system, why is it necessary that we suffer the restrictions imposed by the Post Office Acts of 1953 and 1969?

There is a law to protect a monopoly in the public sector. But what an outcry there would be if there were a monopoly of this kind in the private sector.

Mr. Bruce George (Walsall, South)

Solicitors?

Mr. Gow

I shall come to that. I assure the hon. Gentleman that I am strongly opposed to the monopoly of solicitors in the matter of conveyancing, and I should be happy to see free competition between them and those other practitioners who wished to ply their trade. I should say—I wish that the Post Office had the same confidence—that people would prefer to go to solicitors with a qualification rather than to those without a qualification. So I am in agreement with the hon. Gentleman, and I am being, I hope, consistent in my argument.

Why is that the Post Office, which has conceded that there is no case for a monopoly in the delivery of newspapers and in the delivery of parcels, should insist upon a monopoly, backed up by the law, in the collection and delivery of letters? That is at the heart of the discussion that we are having this evening. That principle—that we ought to open up the Post Office to the fresh breezes of competition in the collection and delivery of letters—has taken on a new importance in connection with the NW2 postal area.

On Monday of this week my right hon. and learned Friend the Member for Hendon, South (Mr. Thomas) put this question to the Secretary of State for Industry: …is the Secretary of State aware that, unless the Post Office insists on the performance of its clear statutory duty to provide services to the NW2 area, there will be a widespread and irresistible demand for a change in the Post Office monopoly and a change in the1969 Act…? Later, the Secretary of State said: The Post Office has put to me the suggestion that the Government should consider revocation."—[Official Report, 25th July 1977; Vol. 936, c. 30–1.] That is revocation of the material—

Mr. Deputy Speaker (Sir Myer Galpern)

I think that what the hon. Member for Eastbourne (Mr. Gow) is now beginning to develop is strictly not in accordance with what is relevant and in order. He is now launching on the argument that we should change the monopoly situation from what it is to something entirely different, which would require legislation and which therefore would be absolutely out of order. If the hon. Gentleman would put a 9p stamp on his speech it might be delivered a bit faster.

Mr. Gow

Am I not ready constantly to defer to your ruling, Mr. Deputy Speaker? Section 23(2) of the Post Office Act 1969, which fortuitously is now in my hand, provides that: The said restriction is that the power to authorise letters to be sent, conveyed and delivered otherwise than by post and the collection of letters otherwise than by an officer of the Post Office which is conferred by the proviso to subsection (1) of the said section 3 and with which the Post Office becomes invested by virtue of the foregoing subsection shall not be exercisable except with the consent of, or in accordance with the terms of a general authority given by, the Minister. Since the heading of the debate in the list of subjects for debate is the Exercise of ministerial power to authorise the sending, conveying and delivery of letters otherwise than by post", I submit most respectfully that it is in order to address the House and the Minister on the refusal of the Secretary of State, as conveyed to the House on Monday, to authorise the sending of letters otherwise than by post. Indeed, that is the exact wording of subsection (2) of Section 23 of the Post Office Act 1969.

Mr. Deputy Speaker

I am sorry to interrupt the hon. Gentleman again. What he has just said is absolutely in order. To confirm what I was saying earlier in regard to change of the law, "Erskine May", at page 745, says that Debate on all these bills is limited to relevant questions of administration and, as in debates on the estimates themselves, questions of taxation and legislation cannot be discussed. I am sure that the hon. Gentleman will stay in order.

Mr. Gow

I was not arguing for a change in the law; I was arguing for the Minister to exercise the powers conferred upon him by his own Act.

One of the virtues of the 1953 Act was that it gave the Minister power to waive the Post. Office monopoly. Indeed, my right hon. Friend the Member for Leeds, North-East put it to the Minister on Monday that, in the case of NW2, he ought to remove the Post Office monopoly.

I turn now from the general to the specific NW2 situation where letters have been piling up at the sorting office. Businesses that are struggling to carry on in that area and are employing people now find that their cash flow is drying up because cheques are not getting through. They are having to lay off staff. The Post Office, which has a monopoly, is failing to carry out its statutory duty to deliver mail. Therefore, the Minister has power, specifically conferred by Section 23(2), to waive the monopoly.

In NW2 it is not only private citizens who are being grievously inconvenienced by the failure of the Post Office to deliver letters; the post boxes in this House have stuck over them an injunction saying that we may not post letters to NW2.

The personal hardship and difficulties being encountered by people living in NW2 are serious enough, but what is even more serious is the commercial damage that is being done to shops, small factories and businesses of every kind that are carrying on business in that area.

On Monday, my right hon. Friend the Member for Leeds, North-East said that pension books were not being delivered to pensioners living in NW2.

We now have the highest unemployment figures since the war. For companies to be driven into bankruptcy because of the sterile maintenance of this monopoly is an outrage. At a time when the Government should be taking every step that they can to prevent an increase in bankruptcies and unemployment, they are persisting in upholding the monopoly of the Post Office even though it is unable to deliver letters in NW2.

Apart from the general principles that I outlined earlier, we argue that this is a case where the monopoly should be lifted and where free enterprise should be allowed to do what it is prepared to do—namely, to deliver letters—at a cost, of course—in NW2. There are bags of mail in the Cricklewood sorting office that could and should be delivered.

Of course, the Government will argue "Once we allow a variation or relaxation of the monopoly, we shall cause damage to the Post Office". If the Post Office is as marvellous as it claims to be, what does it have to fear from ending the monopoly?

In its own report, on page 6 it states: The postal service remains unquestionably one of the best in the world". I do not dispute that, but if the collection and delivery of mail by the Post Office is so super, what do the Minister and the Post Office have to fear from ending the monopoly? Why, if it is unreasonable to allow a monopoly in the private sector, is it unreasonable to allow competition in the Post Office?

If newspapers and parcels can be delivered by free enterprise, why not letters? In the case of NW2, why should the Minister insist on the maintenance of the outmoded monopoly when the consequences of his insistence are so great—inconvenience to individuals who write and receive letters, and a potential increase in bankruptcy and unemployment among small businesses?

I urge some fresh thinking on this matter. I hope that the Minister will tell the House tonight that one of the first actions he will take in the recess will be to give further urgent consideration to relaxing the monopoly and ensuring that no further damage is done to the economy and to the employment prospects of NW2.

1.41 a.m.

Mr. Norman Lamont (Kingston upon Thames)

The House is indebted to my hon. Friend the Member for Eastbourne (Mr. Gow) for raising this important question on the monopoly of the Post Office, and in particular the situation in NW2. I follow him by considering the position of the Secretary of State in not using his undoubted discretion to suspend the monopoly.

The situation in NW2 is having extremely serious repercussions on a number of small businesses—between 100 and 200 of them—whose mail is being held up in the Cricklewood sorting office.

I make it quite clear that I recognise that the Union of Post Office Workers had a very difficult task. I am not criticising it, because it did try to sort out the matter. I recognise, also, that the Post Office Corporation has a very difficult problem. It removed the Grunwick mail from the Cricklewood sorting office hoping that that would get everyone back to work. It did not succeed, and because of that it could now be argued that this gives the appearance of discrimination against other firms.

The sorters in the Cricklewood office have said that they would handle all mail except that of Grunwick, and the Post Office has said that that is unacceptable. There cannot be a situation in which Post Office workers can say which mail they will handle and which they will not touch.

The issue of principle here is that the monopoly of the Post Office gives priviledges to those who work in the Corporation, and therefore there is an obligation by virtue of that monopoly.

The merits of Mr. Ward have nothing whatever to do with this. I observe in passing that many people consider that the workers are criminally liable. That seems quite clear from the 1953 Act. As for the argument that all this dates from the period of the footpads and highwaymen, we all know that these provisions were specifically put into the 1953 Act.

What can be done? What has led my hon. Friend the Member for Eastbourne to the conclusion that the only way out is to suspend the monopoly in NW2? I suppose that the Post Office could allow people to collect their mail, but that would be very difficult. It would present problems of identity if people could just walk into the Post Office and claim their mail. Another alternative would be to have replacement staff, but then the dispute would be extended to other areas of London.

Logic clearly demonstrates that it would be sensible to suspend the monopoly in NW2. That would be the only way in which one could deal with this enormous problem of the mail piling up.

There are problems with outgoing and incoming mail. For the outgoing mail one could consider allowing people to collect it, and the Post Office could be indemnified against any liability. As for the incoming mail, it is quite clear that one ought to suspend the monopoly. The Secretary of State has the discretion to do that. There is a strong case for saying that in the event of industrial action in the Post Office—given the Post Office's monopoly position and the absolutely basic nature of the service to many businesses—it should be basic for the Minister to suspend the monopoly. We can recall what happened in 1971 during the Post Office strike. All sorts of alternative services mushroomed and people were able to get their mail delivered in central London through alternative services.

Another point in favour of the argument of my hon. Friend is that if the monopoly were suspended it would strengthen the position of the Union of Post Office Workers and make it easier for the union to argue with the men in the sorting office that the livelihood of their fellow workers was being endangered until the matter was resolved. It would help the authority of the UPW with its members.

I hope that when the Minister replies he will bear in mind that this is an extremely serious situation for many businesses and that with every day that passes the liquidity position of many of them is worsening. Of course, the problem is a godsend for those who owe money to firms in the NW2 area. It is of advantage for their cash flow. However, the matter is becoming extremely serious for businesses in the area. I understand that more than 100 businesses are affected. For that reason I should like strongly to support my hon. Friend the Member for Eastbourne's case for suspending the Post Office's monopoly in NW2 for the duration of this unfortunate strike.

1.48 a.m.

The Under-Secretary of State for Industry (Mr. Les Huckfield)

I must confess to having been somewhat concerned by the spirit in which the hon. Member for Eastbourne (Mr. Gow) raised his subject tonight. I could not help feeling that he might have been more constructive, and that his attempt would have been regarded more favourably by the House had he not raised the subject in that spirit. The hon. Gentleman rather spoiled his case, because it was possible —if one disregarded the first paragraph of his speech—to believe that he was trying to be constructive in solving a serious problem. However, that first paragraph, about breaking a monopoly and introducing competition, together with the hon. Gentleman's philosophical discourse, spoiled the case.

In the past the hon. Gentleman has introduced various denationalisation measures and has sponsored measures favouring more competition and spelling out the Tory alternative. I recognise that he has stuck to his guns and held to his principles. He was right in recognising that there is a monopoly in the postal service, which was conferred upon the Post Office by Section 9 of the Post Office Act 1969. That Act places a duty upon the Post Office: to exercise its powers to meet the social, industrial and commercial needs of the Post Office…throughout the British Islands. I do not want to go into all the arguments for and against monopolies, but I am sure that the House will recognise that there is some difference between the kind of service that is provided by the Post Office and the kind of communication services of which the hon. Member for Eastbourne has spoken.

If the hon. Gentleman is talking of parcels services, where there are several public carriers competing for business, he should know that they are all making losses and are being cross-subsidised. I hope that the hon. Gentleman will not think that this is a better alternative because those who have studied that competition have concluded that the answer to the problem is the establishment of a monopoly. It is difficult to accept that the position is as black and white as the hon. Gentleman suggests.

The hon. Gentleman seems to misunderstand the powers of my right hon. Friend the Secretary of State. Section 23(2) of the Post Office Act 1969 gives him power to give consent to the Post Office to permit the operation of some other scheme, but it does not give him power to break the monopoly. The hon. Gentleman seemed to suggest that it did. He ought to give the Act more serious examination.

Mr. Gow

If the Minister argues that the Secretary of State does not have the power to suspend the monopoly, how does he account for the fact that the Secretary of State said on Monday: The Post Office has put to me the suggestion that the Government should consider revocation. I told the Post Office, when it put it to me, that at this stage it is the view of the Government—the political view of the Government—that to do that"— that is, suspend the monopoly— would exacerbate the situation."—[Official Report, 25th July 1977; Vol. 936, c. 31.] My interpretation of Section 23(2) and the right hon. Gentleman's interpretation on Monday indicate that there is such a power for the Secretary of State. The 1953 Act spells out the power even more clearly.

Mr. Huckfield

I do not want to indulge in a philosophical or semantic discourse with the hon. Gentleman. The Act confers on the Secretary of State a power to permit the operation of certain other services, but it does not give him the power to break the monopoly conferred on the Post Office. If the hon. Gentleman fits my remarks into the context of his opening paragraphs, he will see that I am right.

This is not the first time that this subject has been raised in recent weeks. On Monday, the Secretary of State made clear the decision that he had taken on the matter of ministerial consent for the breaking of the Post Office monopoly. My right hon. Friend has been in continuing contact with the Chairman of the Post Office Corporation at this difficult time over the licensing of alternative services in NW2. On Monday, my right hon. Friend told the House that any such action at this time could only exacerbate and worsen an already difficult situation. That is a view that we reach in the light of the extensive efforts being made by both the Post Office and the Union of Post Office Workers to try to secure a return to normal working. I am glad that the hon. Member for Kingston upon Thames (Mr. Lamont) paid tribute to the efforts of the Union of Post Office Workers to secure a return to normal working.

As the hon. Members for Eastbourne and Kingston upon Thames know, the Post Office last Saturday agreed to a request from Grunwick to hand back the unfranked outgoing mail at the Cricklewood sorting office that had not yet entered the postal system. On that occasion the Post Office took the view that the removal of the cause of the dispute could alleviate the situation and leave the way open for a return to normal working. The Post Office workers, however, decided that they would resume work if they were given some sort of guarantee by the Post Office that they would not have to handle Grunwick mail. The Post Office could give no such guarantee.

I repeat what has been said outside the House and by my right hon. Friend about the efforts of the Union of Post Office Workers to persuade its members to resume work. I repeat the tribute that has already been paid. It is because of the efforts of the union that the dispute has so far been contained. I understand that the London District Council of the UPW decided that it would continue to urge its members not to black Grunwick mail posted outside NW2. I understand that the union's executive has subsequently issued an instruction to its members declaring that it does not regard mail posted by NW2 residents outside the NW2 area as diverted mail. In other words, the UPW firmly declared its policy as being to handle all mail from NW2.

The Deputy General Secretary of the Union of Post Office Workers, Mr. Norman Stagg, has said that he is concerned about what he feels to be the generation of a deliberate campaign to escalate this dispute. I am not accusing the hon. Members for Eastbourne and Kingston upon Thames of wanting to do that, but it should be placed on record that it is causing the deputy general secretary concern. He feels his members to be put in a position in which they are exposed to provocation from left and right, as he puts it.

When we have a situation in which the UPW is bending all efforts and energies to secure a return to normal working, when we have a situation in which the executive council of the union has endorsed that policy, as has the London district council of the union, and when there is to be another meeting for Grunwick workers to discuss the matter, I commend to the House the efforts that it has been making. It is also worth bearing in mind—I hope that the hon. Members for Eastbourne and Kingston upon Thames will take this to heart—that the union has stressed to its members the duty to handle all mails and not to discriminate. Having said that, I hope that they will pay tribute to the union's r âle on this occasion.

It is in view of these various moves that my right hon. Friend the Secretary of State reached the view that the action to remove the Post Office monopoly in NW2 would not at this time be warranted. As long as there continue to be courses of action available to either the Post Office or the union that stand a reasonable chance of providing a solution to the dispute, we believe that steps that might worsen the situation are best avoided. We believe that to take the action that has been urged by Opposition Members would inflame the situation and spread a dispute that has so far, because of the efforts of the UPW, fortunately remained localised.

The Government fully understand and sympathise with those living in NW2 for all the inconvenience and difficulties caused by the lack of postal services. I have been in receipt of a number of letters and representations from hon. Members representing their constituency interests. Therefore, we have certainly had the effects of this dispute brought to our attention in the Department of Industry, and we understand its implications for residents in NW2. Nevertheless, we feel that the only happy result from the postal point of view is to get all of the mail moving, not only that which is being posted now but that which is trapped.

There may be some misunderstanding about what a suspension or a derogation from the monopoly position may involve. If the hon. Member for Kingston upon Thames looks at what happened during the strike in 1971 and at previous examples he will see that a derogation would not help the situation with regard to the backlogged or trapped mail. It would, perhaps, provide some way of bypassing NW2, but it is worth stressing that a derogation would not help with regard to the mail trapped at Cricklewood at present. Indeed, we believe that because any attempt to do that could be seen to be based on some kind of confrontation it could only be counterproductive.

I am also a little concerned about some of the legal implications of what the hon. Member has been saying about allowing people to collect their own mail or in some way bypass the Post Office's normal service. A number of legal obligations are placed upon the Post Office in this regard, and to allow people to do things under their own efforts—in this context I am glad that the hon. Member for Eastbourne quoted the restrictions—could raise some quite severe legal problems for the Post Office.

We feel that it would help no one in NW2 if we were to take or recommend action that resulted only in a further escalation of the dispute and deprived others elsewhere of postal services.

Mr. Norman Lamont

I recognise that allowing people to collect their own mail would raise both practical and legal problems. I specifically referred to the practical problems. However, could not there be devised some arrangements whereby people could collect their blocked mail in exchange for producing identification and signing an indemnity for the Post Office?

Mr. Huckfield

I am not sure about the number of administrative staff and the arrangements that would be necessary to operate such a scheme, but there would be a considerable number of administrative difficulties in the hon. Member's suggestion, apart from the legal problems involved.

I know that hon. Members are concerned about this matter. I assure the House that my right hon. Friend is keeping in constant touch with the situation and that he and the Post Office, whose conduct has been very considerate, want to take any action—obviously taking into consideration all the factors in the situation—that looks like bringing a successful outcome to this affair.

We do not believe that a derogation or a suspension would at present contribute to that kind of success. That is not the best way forward. I once more draw the attention of hon. Members to the efforts being made by the UPW in conjunction with the Post Office. I suggest to hon. Members that that is really the best way forward, although I recognise that this dispute is causing problems in NW2.