HL Deb 09 March 1961 vol 229 cc517-34

3.24 p.m.

Order of the Day for the Second Reading read.

EARL ST. ALDWYN

My Lords, I have it in command from Her Majesty the Queen to acquaint the House that Her Majesty, having been informed of the purport of the Post Office Bill, has consented to place Her Majesty's prerogative and interest, so far as they are affected by the Bill, at the disposal of Parliament for the purpose of the Bill.

LORD ST. OSWALD

My Lords, I beg to move that this Bill be read a second time. In so moving, I might begin by explaining why the Queen's consent, which has just been signified by my noble friend Lord St. Aldwyn, is needed for this Bill. The revenues of the Post Office have formed part of the Hereditary Revenues of the Crown, ever since they were vested, by an Act of 1685, in King James II and his successors. Since the year 1760, it has been customary for these revenues to be surrendered to Parliament at each Accession, for the duration of the reign, in return for the Civil List. This Bill, because it sets up the Post Office Fund on a permanent basis, constitutes an obstacle to the resumption of any Post Office revenue by the Crown at the beginning of a reign, and so necessitates the Queen's consent.

My Lords, King James II would scarcely recognise his Post Office to-day. Nor would the original Master of the Posts, Sir Brian Tuke, appointed in 1512; or even the first Lord Stanhope, who 80 years later widened and organised its activities along the classic Five Roads radiating from London, those to the North, to Kent, to Chester, to the West, and to Bristol. Even he would be astonished at the further expansion which has taken place since his day.

Preceding the present Bill, there have been two main organisational developments in the history of the Post Office. First there was its assimilation as a revenue Department, into the increasingly meticulous system by which Government revenue and expenditure in general came to be controlled and accounted for. Later there were the stirrings, especially from the time of Rowland Hill onward, of a determination that public utility should be put before fiscal exploitation. In our own century, public interest and public criticism urged on this form of development, which was aided by the appointment of the Bridgman Committee in 1932. The Bridgman Committee recognised publicly that the Post Office ought to cease to be a fiscal instrument, and become self-contained financially. Unfortunately, the practical measures which they felt able to recommend at that time fell a good deal short of giving the Post Office the full liberty implicit in this principle, and it has taken nearly 29 years for their findings to bear truly nourishing fruit, in the shape of this Bill. The war, for one thing, put the clock back in this as in other spheres, but a Bill is now before your Lordships.

I should say, first of all, that nothing in it is intended to weaken the sense of responsibility which the Post Office feels for the social implications of its services. In another place some disquiet was expressed that the two financial duties laid on my right honourable friend by this Bill—to secure that his revenue covers his outgoings, taking one year with another, and to establish and maintain a general reserve—will submerge the Post Office's social obligations. I can assure noble Lords that this is not so. Future practice will confirm the principle, already implicit in Post Office policies, that for the most part prices must be such as to cover at least the average cost of the service rendered. But this does not mean that every single service has to be run at an economic rate. For example, the telegraph service has always run at a loss, and we also make losses on telephone kiosks which, in fact, are provided in this country more generously than in any other.

What the Bill does is to implement the proposals set out in the White Paper, published last March, called The Status of the Post Office (Cmnd. 989). It also makes a few minor legislative changes, which are useful but not strictly consequential upon that White Paper. A further White Paper (Cmnd. 1247) has accompanied the Bill, so that I think no very detailed explanation is called for for such of your Lordships as are interested on this particular occasion. The essential step is the Post Office's separation from the ordinary Government finances, which is done by the setting up of the Post Office Fund, in Clause I of this Bill. This Fund is to be the repository of the Post Office trading receipts and the source of its outgoings. Broadcast receiving licence revenue and fines will still go to the Exchequer, but otherwise all Post Office receipts will be retained for use in the business.

The Post Office will bear its proper share of tax burden like any other business. As it will remain a Crown Department, it will be exempt from the direct consequence of tax law, but the Bill provides in Clause 2 for the payment of a contribution to the Exchequer nearly enough equal to the value of the exemptions. The Treasury must agree the payments, and the various departments responsible for tax collection will be consulted to ensure that the right amounts are paid. As an exception, postal orders will not be liable for a contribution in lieu of stamp duty. If levied, this would amount to 2d. per order, plus a further 2d. for receipts on orders for £2 or more. Such additions would defeat the purpose of postal orders as a cheap means of sending small sums. Money orders, however, are for larger sums, up to £50, and are more like cheques. On them, therefore, 2d. will be payable by the Post Office in lieu of bill of exchange duty; but nothing will be levied for receipt duty.

Other Departments will pay in cash for Post Office services available to the public at the same rates as the public, or for other services, at a fully costed charge. The initial assets and liabilities of the Post Office Fund will be those shown in the Commercial Accounts for the year ending on the last day of the old arrangements. This is an eminently fair provision that leaves the Post Office owing no more than is due to the Exchequer for assets that it has financed in the past.

The Post Office starts off on its new footing by translating into reality the situation shown in its commercial accounts which it has been preparing for nearly half a century. As well as showing the assets and liabilities of the business, they show its income and expenditure. For 1959–60, for instance, they show the Post Office as spending £422 million and receiving an income of £442 million, leaving a surplus of £20 million. This sort of information has been translated into an attractive, not to say picturesque, chart, for the benefit of people like myself who can understand no other form of balance sheet, with neat piles of shillings denoting various kinds of income and expenditure.

For all that, the whole thing until now has been notional. Included in the income and expenditure are payments for work done for other Departments by the Post Office, and vice versa. But the Post Office never received money for these services to other Departments, nor did it pay the Departments for services rendered to it. In general, Departments do not pay one another for services.

Because of this, complex calculations have had to be done by anybody who wanted to reconcile the money which the Post Office says it has spent in its commercial accounts with the money it did spend according to its Parliamentary cash accounts. This confusion will disappear, because in the future the commercial kind of account will be the only one; and if it shows that the Post Office has received the £442 million that I have just mentioned, then that money will really have flowed into the Post Office Fund.

Annual Parliamentary authorisation of expenditure through Estimates ceases, except in relation to Ministers' salaries, staff pensions and broadcasting, but effective Parliamentary control will remain. In the first place, the Post Office will still be headed by Ministers of the Crown fully answerable to Parliament, and their salaries will still be voted by Parliament. Secondly, it is provided in the Bill that an annual Resolution of the House of Commons will be required before any payments can be made from the Fund in the ensuing year. Thirdly, statutory instruments providing for Post Office charges will all now be laid before Parliament and subject to annulment by either House.

Parliament will remain well-informed about Post Office affairs by the Report and Accounts, together with the Auditor General's Report on the latter, which will be published after the close of each financial year. Further opportunities for discussion will arise on borrowing powers which it is expected will need extension about every two years, by House of Commons Resolution and by Money Bill alternately. Treasury control will automatically diminish through the bringing to an end of the traditional Vote and accounting procedures. The Bill, however, formally removes certain statutory provisions which subject various Post Office commercial actions to the need for Treasury consent. Treasury control over pay and conditions of staff, investment and foreign exchange continues, but there need be no legislation for this purpose.

Post Office staff will remain civil servants. The Bill ensures that their pension position under the Superannuation Acts is not prejudiced by the separation of Post Office finances. The security of the pensions will continue to be that of the State, not of the Post Office, and pension payments will therefore continue to be voted. But the Post Office will be expected to set aside enough to finance the pensions, and appropriate sums will be paid into the Exchequer as if into a pension fund.

Clauses 8, 9 and 10 of the Bill refer to the borrowing powers of the Post Office under it new status. Under Clause 8 the Post Office will be able to borrow temporarily from the Bank of England for its short-term needs. Such borrowing will be limited by the Bill to £30 million. Experience shows that Post Office working balances may fluctuate by as much as £20 million while at times sudden rises in expenditure may have to be met before compensatory action can be taken. The limit of £30 million was, in fact, challenged in another place during the passage of this Bill as being too little, but we are satisfied that it will be sufficient, having regard to an examination of past fluctuations in the Post Office cash position.

Clause 9 provides for Exchequer advances to meet Post Office longer-term requirements for the purposes of fixed or working capital. Borrowings will be repayable after a set term of years. The term will normally correspond to the average life of the assets financed. Twenty-five years is at present the period in mind, but advances for working capital might be for a shorter period.

Clause 10 defines the limits for Exchequer advances in terms of a maximum debt which may be outstanding at any one time, whether in respect of past borrowings or of sums advanced under the Bill. The debt at the date of severance is expected to be around £800 million, so that the lower limit of £880 million effectively authorises additional borrowing of about £80 million. The upper limit of £960 million which may be authorised by a resolution of the House of Commons would permit a further £80 million to be borrowed. The initial sum of £80 million would, we expect, provide for the needs of about two years, and the further sum of £80 million for about a further two years. Capital expenditure in the whole period (including some increase in working capital) might well come to about £500 million. Recent performance suggests that it may be safe to assume that at least two-thirds of capital finance can be provided from income. This means that some £340 million of the £500 million would be self-financed, leaving about. £160 million to be borrowed.

My Lords, by the system of accounts that have been kept over the past many years we have had the advantage of a blueprint to know how the financial performance of the Post Office goes and will go, and therefore the Bill establishes the Post Office on a firm and known financial footing. It is a long and widely awaited piece of legislation, and I hope that it will win general satisfaction and approval from your Lordships' House. I beg to move.

Moved, That the Bill be now read 2n. —(Lord St. Oswald.)

3.40 p.m.

LORD CROOK

My Lords, I rise to support the Bill on behalf of noble Lords on this side of the House. Some five weeks ago I had the privilege of addressing your Lordships on another Post Office matter, and on that occasion I took the opportunity of recounting an experience in New York when, at 6 o'clock on a Monday evening, I was promised that a letter would be sent to my hotel, three miles across the city. By Wednesday morning I had not received that letter, although I had received one posted at 7 o'clock on the Monday night by one of your Lordships here in Westminster. I then pointed out to your Lordships that neither my American friends nor I were surprised. They were accustomed to the excellent Post Office service of this country, and we take it for granted. Indeed, I think that the people of this country very often take their Post Office service too much for granted, and that is why, on the odd occasion when someone gets a letter late, or a letter is sent to the wrong place, it merits even a letter in the Press. Apparently it has not been realised that the poor fellow in question is one of those who sent the 10,000 million letters a year which I know the Post Office has to handle in the course of twelve months.

It is because of the experiences I have had while connected with the Civil Service over the past 30 years, and in travelling abroad, that I welcome the opportunity afforded to me of speaking on behalf of noble Lords on these Benches and saying on this occasion a few words appreciative of the Post Office while offering some observations on this Bill. I want to tell the noble Lord who moved the Second Reading of the Bill that we shall do everything we can to expedite it, as we understand that if the Bill is to be at all effective it is essential that it shall operate from the first day of the new financial year, which means that it must have Her Majesty's assent some time this month. I can assure the noble Lord that, since we are most anxious to see this great and long-delayed measure put through, we shall do everything we can to help. But that does not mean that we have no criticisms of the Bill to offer; for we have, as I shall point out.

Broadly, we welcome the measure, so far as it goes, because it gives some freedom from Treasury control—and I would stress the words "some freedom", for it gives only some of the freedom for which we were pressing in the debate some weeks ago. Then I brought to your Lordships' attention the difficulties of the immediate past when I pointed out that although the White Paper on Post Office Capital Expenditure (Command 973), in 1955, had referred to the fact that three-year averaging was indispensable for economic development, such averaging had never been permitted because of the financial controls imposed by the Chancellor of the Exchequer and the Treasury over the Postmaster-General. Indeed, as has been pointed out on a number of occasions in the other place, the Postmaster-General himself never knows how much he is getting for the current year, never mind three years ahead.

The right honourable gentleman Mr. Marples, who was then Postmaster-General, not only complained but, on May 15, 1959, told right honourable gentlemen and honourable gentlemen of another place [OFFICIAL REPORT, Commons, Vol. 605, col. 1626]: I am quite certain that … one cannot run a business like the Post Office or any big business on a year-to-year basis. It is physically impossible to do so. There must be a steady programme, and one cannot turn that programme on and off as though it were a tap. The business will not be efficient if one does. We have therefore been pressing for freedom from the Treasury. One small part of which is here; because when the Bill becomes law the Postmaster-General will at least be able to plan his job for some considerable time ahead. But the freedom is subject to limits which, in the view of some of my friends in another place and here, are not justified. That is why I shall offer criticisms while not proposing to detain your Lordships with too much detail or to present an Amendment in the Committee stage.

I should be doing less than justice to Her Majesty's Government if I did not say we welcome wholeheartedly this attempt to carry out the 1932 Bridgman Report, and in particular welcome the decision which the Government have made, contrary to what some of their supporters were pressing on them, to leave the Post Office alone and not make it a public corporation. Thinking British people are jealous of the handling of the great service by State employees and with a Minister responsible to Parliament. I welcome personally the fact that that Minister is to retain the title of Postmaster General, a title first given to the holder of that office in the days of Cromwell and which we are proud to think will be kept. After studying the Bill and hearing the explanations Ministers have given, I am quite happy that another place will have greater, and not less, opportunity of examining the affairs of the Post Office and reaching conclusions about them.

The Minister, in moving the Bill, referred to the future status of civil servants employed by the Post Office, which is the subject of a special clause. We are very happy about that. This is a great reorganisation, said by the Government to be on commercial lines; but all too often the unwise commercial tycoon thinks of himself and his fellow directors, and sometimes even of his shareholders, while all too often forgetting the work-people, who have invested everything they have—their labour—in the concern with which they are connected. Here the Government have taken the right line, and civil servants of the Post Office, whom I have known for so many years as a great bunch of people, retain their existing status. Their pensions and future conditions will be dealt with in the same way as now; and "as now" means being dealt with through the machinery of the National Whitley Council and the Ministry Whitley Council inside the Post Office, and the maintenance of the excellent industrial relations machinery which, one is bound to admit, the Post Office has with the Union of Post Office Workers and the Post Office Engineering Union.

I would point out that to the extent that this provision is made as to status and pay of the staff, it is one departure—and a good one—from commercial freedom that commercial freedom which, as the noble Lord said, has been the subject of a good deal of concern in another place during the passage of the Bill. It was a matter of concern because it was felt that rather too much emphasis was being placed on the word "commercial" and not enough on the word "social". We want to emphasise—and this is one of the reasons why I stand here now—that nothing which aims at producing the good commercial background of the Post Office must stop its ability to carry out its social services, which may often cost money and cause a losing item on its balance sheet.

The old ladies must still have the opportunity of drawing their old-age pensions at some place that does not make them toil for a mile to a post office. There must still be a telegraph service, and particularly the unprofitable kiosk to which the noble Lord has already, quite candidly, referred, for people in the country, or those who live in great housing estates and have neither the facilities for nor the finance to afford a telephone for themselves. That is a social responsibility which we could not see taken away.

When it came to seeking from Parliament the powers for commercial freedom for the Post Office, Her Majesty's Government seem to have got "cold feet" part of the way, if one is to judge by some of the clauses about financial powers and so on; because the limitations which have been put on the borrowing powers, both short-term and long-term, are not what most people in this House who are running businesses would regard as very much commercial freedom.

In Clause 10 the figure of £880 million, which is provided as the total amount for debt, will, as I understand it from the statement of the Postmaster-General, give him an amount that will cover only about two years; the second figure of £960 million will cover a further two years; and after that a new Money Bill will be needed. I admit straight away the reply which the Minister could give: namely, that a new Money Bill has something to be said for it (he referred to the fact that it might be needed) as it would give another opportunity of discussion in the House. But I rather feel that there has been too much of an attempt to restrict the very freedom which was being given, and it is not the kind of freedom for which we should have hoped. In another place representatives of those who sit on these Benches moved Amendments, and those Amendments we could inflict upon your Lordships again, but it would be taking up the time of the House to do that. It is for this reason that I am making this statement now, indicating that we shall not put down those Amendments merely to have the Government reject them all over again.

So far as the General Reserve provided for in Clause 7 is concerned, I shared the concern of my colleagues in another place. We learned that the total amount of money the Treasury were likely to hand over would be under £30 million—to be exact, probably only £27 million. But I gather that what has now happened is that the amount is to be augmented by such surplus as the Post Office earns in the course of this year; and the Postmaster-General is satisfied because he is doing so well that he may hope to finish with certainly £40 million as the amount to be handed over, and perhaps as much as £46 million. That being so, I have no particular criticism to offer of the clause. Anyone looking at the needs of working capital and ordinary business contingencies would probably have been led to the conclusion, in broad terms, that £50 million would be about the amount required, and it looks as if the Postmaster-General is going to start off with something like that figure.

There is one other piece of commercialism in the Bill to which the noble Lord referred and which we do not think is very amusing at all; we cannot understand it, in fact. That is the imposition of income tax. If this were to be a public corporation, as was suggested by some persons, instead of being merely the form of organisation which has been chosen within the Government, one could understand it. But, as I see it, this means merely that money will be taken out of the right-hand pocket and transferred to the left-hand pocket of the Government machine. Any one of your Lordships who has read Annexe A of Cmnd. 1247 (which was the Memorandum on the Bill we are now considering and was published when the Bill was presented in another place last December) will find that it gives a detailed account of all the work involved in securing what is said to be the amount: — the Pont Office will pay as nearly as may be what it would pay in taxation, but for the various exemptions that affect it. So, as I see it—indeed, as this Bill provides—the traditional exemptions for a State enterprise are there, and they are then given up by this Bill. As a result, the great machinery in Annexe A comes into play, which will involve the spending of thousands of hours by large numbers of civil servants in making intricate calculations, at a cost of thousands of pounds in salaries, in order that it may be determined accurately how much is to be taken out of the right-hand pocket and put into the left. That may be something which it is necessary to do in the interests of good government. We, who have looked at it in the other place and here, have not been very convinced by anything we have seen or read or by any of the explanations which have so far come from the Post Office Department.

Before I leave the subject of commercialism, there is one other comment which I should like to make. Why, oh why, if we leave the same Civil Service staff to operate effectively and to run the business and keep the accounts on the efficient lines on which they have always run, do we need to provide in Clause 12 (1) that accounts shall be kept for the future in a form "which shall conform to the best commercial standards"? What we want are accounts that Parliament can understand when they are presented and which we are able to read and discuss; and that is not necessarily achieved, I suggest, by keeping accounts in the best commercial sense. What is wrong with the Civil Service accounting of the Comptroller and Auditor General's Department, which has served us so well? You are going to leave accounting still to be done by that great Department, a Department which does not find any difficulty in detecting the difficulties that may occur in transactions between firms and Government Departments. I would rather have seen it said that accounting shall conform, not to the best commercial standards, but the best standards of Civil Service and Parliamentary accountancy, which this country has enjoyed for years.

There are other, smaller points in the Bill with which I will not weary your Lordships. I should like, however, to say a few words about one matter which is not in the Bill, the new recorded delivery packets. Some of my honourable friends in another place put down an Amendment on Report stage, swiftly and at the last minute, as a result of representations made to them by the County Councils' Association and other organi- sations of local government offices. They withdrew it after the Government had indicated that they accepted the principle of the objections. They realised not only that the phraseology was not good, but that what they had been running into was a very considerable piece of difficulty involving not only this Bill but probably many Acts of Parliament.

The problem is a new one. I may explain, very briefly, for any of your Lordships who have not seen the details of this new service in Press advertisements, that it provides that one can have proof of posting a letter by filling in a form at the Post Office and paying a fee. It is something like the A.R. registered post, which many of us have used in connection with legal actions when we have needed evidence of posting, delivery and receipt of a document. But the local authorities have become worried about the use in the advertisement of the words "proof of delivery", which they think may be misleading and may have irreparable consequences if accepted at face value. I understand that the Postmaster-General has discovered that there are at least 50 Statutes so far uncovered which specify the use of registered post. The provision in the Statute in some cases was probably designed to secure only proof of delivery. If that is so, the new system might be good enough. But the sheer requirement of the law may be that the old system of registered post must continue to be used; and that matter needs clearing up very quickly.

What may be involved is Post Office legislation. There may well have to be a Bill which the noble and learned Viscount on the Woolsack will have to present in order to deal with a large number of legal consequences arising from this matter. For that reason, I am not expecting the Minister to say a word about this subject this afternoon; but as I am indicating that we are not proposing to worry the Government on the Committee or the Report stage, I should like to hear something about some method of discussion in which we can get a reply. I should like to hear something on this urgent problem, which is worrying people in business and local authorities all over the country. In that connection, I should expect that my own noble Leader would be able to co- operate with representatives of the Government to secure the end we want.

If I have said nothing in detail about the telephone service it is only because I took so long in talking to your Lordships about it—and you listened so patiently—some few weeks ago. I merely want to make the comment that the exposure I then made of the failure to develop the excellent telephone service we can have, a service which lags behind every telephone service in every major industrial country, was due not to technical difficulties or to the inefficiency of the Post Office, but entirely to the frustration of the Post Office as a machine in respect of monies provided by the Treasury. The improvement of that telephone service—an improvement which I hope will give dialling and subscriber trunk dialling earlier than 1970 —is one of the criteria by which we shall judge the Postmaster General in the exercise of the new powers which this Bill gives him, aimed at partly freeing him from the thraldom of the Treasury.

So I begin to wind up what I have to say to your Lordships by broadly commending the Bill. It has, in my view, the shortcomings to which I have referred, but it is basically a good Bill—an overdue measure of reform—and in some ways quite imaginative. In the midst of its dealing with huge principles, it has not hesitated to deal with one or two petty, yet most useful, things, on which I should like to congratulate the Minister. For instance, steps have been taken in one of the final clauses, Clause 25, to deal with repealing the present silly law which makes it imperative that there shall be painted in while, in capital letters, over the doorway of any little establishment which sells stamps, the words, "licensed to sell stamps". These words must be—and I quote the portentous words of the enactment— painted on some conspicuous place on the outside of the front of the place". That means painted over the doorway of a poor little place where some poor little widow tries to sell a few postcards, and thinks she may sell more if she sells stamps with them. I am glad to see that that petty requirement, along with other petty requirements, will leave for ever once this Bill reaches its conclusion and becomes an Act.

I am sure that, when this becomes an Act, if the Post Office civil servants, as I have known them for 30 years, are given their heads, and allowed to use some of the ideas they have had for years but which they have not in the past been allowed to use, the Post Office and its staff will go on from strength to strength. There are so many things they could do. I will not keep your Lordships by enumerating large numbers of them, but some of them stand out. For instance, in this year, when we celebrate 100 years of the Post Office Savings Bank, look at the extensions which could be made to that Bank. Those of your Lordships who have ever paid bills in countries like Switzerland, and a number of others, will know that wonderful system by which you get a bill with a number on it and two tear-off slips. Then, all you do is to go to the Post Office, pay over the cash, the original bill is post-marked as your receipt, one chit is kept by the Post Office, which deducts the money from the account or adds the money to an account, and the other chit goes off to the person concerned. The saving in commercial labour, in envelopes, in post and in all sorts of things is quite wonderful. Anyone who has had to settle a medical bill, for instance, while in Switzerland or Sweden will know that there are a number of simple ideas waiting to be used. Normally, we have been the pioneers in good postal activities. We have been the great country which has done so much that others have copied us. I think we have a Post Office of which we can all be proud. Come fair weather, snow or wind, the post has gone through. Come peace or come war, the service, somehow, manages to struggle along. We shall now have a chance to see a Post Office, encouraged by this Bill and by the reception it has had and, I think, is going to get from both Houses, going on to do its best for us.

I conclude by insisting, as I have said already, that we for our part still lay great stress and emphasis on the maintenance of the social as well as the commercial side of the Post Office. We shall be satisfied only if, by his future actions, the Postmaster General lives up to the promise which he has made; that is, that the sense of enterprise associated with the commercial approach will not be allowed to prejudice the sense of public service to the community as a whole which has been so dominant a feature of Post Office policy for the past three centuries.

4.4 p.m.

LORD FRASER OF LONSDALE

My Lords, I apologise to my noble friend that I was not able to hear his opening speech, and it may be that he dealt then with a little point on which I venture to ask him a question. I understand that it has been pointed out in another place that telephone calls will be cheaper—that they may even be 2d. each, and that they may become more automatic—but that talking for a long time on the telephone in the evening is going to be severely limited. Now some people may rejoice at that, but others will be very sorry. For example, I had a pathetic letter only two days ago from an old, blind person, who says, "My telephone is my only friend. I live alone, and I ring up and talk to my friends, and I like to talk as long as I like".

It is not to be supposed that this lady is doing any harm when she talks as long as she likes, provided that she does it at a time in the evening when the lines are not required; and if it is a local call from herself to her friend, the only embarrassment that could possibly arise is to her friend, who may have hoped that somebody else might ring her up. If, therefore, the lines are not busy in the evenings or at weekends, is there any reason at all why this limitation should be imposed? Once the connections have been made, and the overheads have been paid, it does not cost the Post Office anything to allow people to talk for a quarter of an hour, or even half an hour, if they want to. I ask that sympathetic consideration be given to this point—and not especially for blind people. But since this may affect all lonely people, why have this limitation?

4.7 p.m.

LORD ST. OSWALD

My Lords, I do not think the noble Lord, Lord Crook, or the House as a whole, would wish me to say more than a very few words in thanking him for the kind way in which he has received this Bill—very kind in general, and kind, even, in certain details, though not in all. I hope that I did, in my opening speech, put sufficient emphasis on the social purpose and aspect of the Post Office in its new status. I tried to do so at the beginning, and I can assure the noble Lord that my right honourable friend is very conscious of this, and is exactly the same in his feelings as the noble Lord, Lord Crook.

The noble Lord referred to what he regards as the too limited long-term borrowing powers of the Post Office, at a ceiling of £880 million, but I would point out what is perhaps not entirely clear at this point. That is that the two years mentioned to be covered by the extra £80 million—the first £80 million which is included in the Bill—is only an estimated two years, and there is nothing to prevent the Postmaster-General from asking for more if, before that two years is up, the £80 million does not prove sufficient. There is no hard-and-fast ceiling set at two years.

The noble Lord spoke also of the income tax liability which was being given to the Post Office in its new status; but if he was not convinced by the arguments of my right honourable friend, which he said he had read, I do not think he is very likely to be convinced by me. He naturally could not resist mentioning telephones, as I expected, and he mentioned again something to which we both referred at some length in a previous debate: that is, the comparison of telephones in our country with those in other countries. In that context I can, in fact, show the noble Lord—and I should like to do so, after the debate—some figures that I have been given. They show (at least, I hope he will take them as showing) that there is a remarkably close relationship between telephones per head and income per head, as well as between the growth in telephones and in income, between our country and other countries, and we really have nothing to be ashamed of in that respect.

The noble Lord spoke of the hope that S.T.D. would come earlier than 1970, and he appreciates that for many people, himself included, I am happy to say, it will come a long time before 1970. lit is by 1970 that we set ourselves to provide S.T.D. for nearly the whole country, but the position is that there is, even now, a diminishing number of people in the country who are not on S.T.D. There are still more off it than on it, but gradually the number off will diminish and the number on will grow, and 1970 is the year by which we hope virtually all will be on S.T.D.

My noble friend Lord Fraser of Lonsdale put another question with respect to the subscriber trunk dialling system—namely, whether it was strictly necessary for local calls to be limited in time, as is the intention. I can tell him that my right honourable friend has at heart the position of such people as he mentioned, particularly elderly people whose life rather depends on being able to carry on long conversations with each other. The noble Lord asked whether something could not be done to lengthen the set time of a local call at night and on Sundays. I cannot give him a precise answer, but I will naturally bring his thoughts on this matter to the attention of my right honourable friend, and I am sure that it will have the influence that his ideas always have on Ministers. I thank the House very much for the way in which it has received this Bill, and I am glad to see that it is generally approved.

On Question, Bill read 2a, and committed to a Committee of the Whole House.