Post Office (Hansard, 3 July 1985)

§ Mr. Christopher Chope (Southampton, Itchen)

I beg to move, That leave be given to bring in a Bill to make provision for the de-regulation of sub-post offices and for connected purposes. Before 1895, in order to become a sub-postmaster one had to be nominated by a local Member of Parliament. That system was rightly brought to an end. I submit that the present system, whereby a local head postmaster has an absolute veto over the establishment of new sub-post office facilities is equally unfair and must be changed.

The Bill is not concerned with the privatisation of the Post Office, welcome though that might be to many hon. Members. The Bill is concerned only with the deregulation of sub-post offices which, almost without exception, are already part of the private enterprise economy. The Bill will encourage the establishment of more sub-post offices and remove from the Post Office the arbitrary power to prevent new sub-post offices from being established.

Sub-post offices are a national institution. There are over 20,000 of them and they represent an important part of the social and economic fabric of the country. The 9,500 sub-post offices in the urban areas are every bit as important as the rural sub-post offices.

In the past 10 years, nearly 2,000 sub-post offices have closed and the Post Office is presently engaged in a strategy to close a further 1,000. Only with deregulation can this trend of declining service be reversed. If nothing is done and the Post Office is allowed to impose upon the public the so-called standard, first set 40 years ago—that post offices should not be closer than one mile apart — many more sub-offices will be closed, to the consternation and dismay of the customers.

The one-mile standard is arbitrary and the reason why the number of post offices has not been reduced to this standard is that the closures have normally been considered only when sub-postmasters retire or resign. What is now so sinister, however, is that profitable sub-post offices are being bribed by the Post Office to close. Even more odious is the spurious justification that Government financial targets are the cause of those closures. If financial arguments are to be used, Crown post offices rather than the sub-post offices should be coming under pressure. The latest figures show that sub-post offices provide 62 per cent. of Post Office business at 50 per cent. of the cost.

I can best illustrate the urgent need for the Bill with a topical example from Southampton. Last Friday, the north Woolston sub-post office closed and later this month the Pinegrove road sub-post office will also close. The two sub-offices were less than half a mile apart and were paying out each week 755 pensions and 430 other allowances. They enjoyed total business amounting to 405,000 units—to use the Post office jargon for the basis of remuneration of sub-postmasters.

I am informed by the Post Office that every sub-postmaster receives minimum remuneration based on 21,500 units but that it is difficult for the Post Office to make a profit when business is that low. In Southampton, however, we are talking about 19 times that minimum level of business, so the demand for the services is clearly 332 there. One of my constituents, Mr. Eric Shephard, wrote to the local head postmaster asking if he could open a sub-post office to meet the demand but was told that he would not be allowed to do so because, allegedly, there were too many sub-post offices already. On what criterion was that decision taken? It was clearly not the criterion of satisfying the customers as the petition against the north Woolston closure was signed by more than 1,000 people.

Many customers would accept the closure of sub-pest offices due to lack of demand or because they were unprofitable, but the two offices that I have mentioned are to be closed only because the Post Office has offered substantial bribes to the proprietors to induce them to cease trading. This came to my notice only when I found that, despite the substantial petition that I had received and a delay by the Post Office in closing one office, the proprietor has been pressing the Post Office to close it as soon as possible because he wanted the money. I calculate that about £37,000 has been paid out by the Post Office to ensure that two sub-post offices in Southampton are closed. That makes no sense and the Bill would deal with that mischief. For one of the sub-post office owners the inducement to close was even greater, as the same person owned the nearest alternative sub-post office and would thus benefit from much of the custom generated if no competition were allowed to develop.

The Bill would not prevent sub-post offices from closing, but it would allow anyone wishing to meet consumer demand to open a sub-post office at his own expense and to run it on the same terms as other sub-post offices. It would also remove any incentive for the Post Office to use its profits to buy out profitable retail outlets. The Bill will make a presumption in favour of anyone wishing to open a sub-post office who has suitable secure premises and is a fit and proper person with adequate training. It would set up a licensing authority independent of the Post Office to consider applications and to allow applicants to tender for socially necessary but uneconomic offices. It will also prevent the Post Office from restricting the opening hours of sub-post offices and from imposing other restrictions on sub-post masters which operate against the public interest.

Deregulation will prove that, in practice, the one-mile-apart standard for urban post offices is inadequate for the customer. In short, the Bill will take the power from the Post Office and give it back to the customers — the pensioners, the families with young children and all who treasure the personal service that sub-post offices invariably give.

Question put and agreed to.

Bill ordered to be brought in by Mr. Christopher Chope, Mrs. Angela Rumbold, Mr. Peter Lilley, Mr. Derek Conway, Mr. Neil Hamilton, Mr. Gerald Howarth, Mr. Michael Fallon, Mr. Michael Brown, Mr. Michael Portillo, Mr. Michael Forsyth and Mr. Tony Baldry.