POST OFFICE SERVICES

HL Deb 30 April 1980 vol 408 cc1284-333

Debate resumed.

4.15 p.m.

Lord WINSTANLEY

My Lords, it seems that it is now time that I endeavoured to draw your attention away from prisons and into post offices, places that are occasionally equally overcrowded but which I hope are otherwise superior in many respects. It is a great pleasure to me to follow the noble Lord, Lord Campbell of Croy. I should like to say straight away how grateful I am—as I am sure is the whole House—to him for giving us the opportunity to debate a matter that is of the utmost importance. Lord Campbell of Croy will remember that some years ago we worked together closely in another place on matters to do with the Post Office, and I hope he will remember also that on those occasions we found ourselves in agreement on all the matters that he raised. Perhaps noble Lords will be glad to hear from me now that I agreed with every single word in Lord Campbell's very interesting speech, which I hope your Lordships will recollect clearly after the interval that we have had since he made it, because he drew our attention to some very important themes.

Perhaps I ought to begin by declaring a previous interest, if there is such a thing, in that for the two-year period of the experiment in industrial democracy I was a part-time member of the Post Office Board, a so-called consumer member. In that capacity as a member of the Post Office Board I was privy to much confidential information that I am afraid is subject to the terms of the Official Secrets Act and which it would obviously be improper for me to disclose. It is not that I might not like to talk about some of those matters, but I will not do so. Thus, perhaps, your Lordships will accept that my words today will be brief. May I also add by way of apology that I have another engagement in your Lordships' House and I shall have to absent myself for part of the debate. I hope that those speaking at that time will forgive me, although I shall return as soon as I can escape from the other engagement.

I have risen on this matter to make really but one point and to try to emphasise it. I shall deal only with that particular aspect and matters immediately related to it. I should like to begin personally by paying a tribute to the work of Sir William Barlow in his all too short a period as chairman of the Post Office Board. I think that he brought a new approach, a new freshness and new initiatives. Certainly, having worked closely with him, I should like to say how very sorry I am to see him go and how grateful I was personally to him for the actions that he took. I am quite sure that your Lordships' House would be right in recognising the immense contribution that he made in tackling what were, as the noble Lord, Lord Campbell of Croy, has pointed out, very difficult tasks.

I should like to remind your Lordships' that when Sir William Barlow was appointed chairman, and took up office on 1st January 1978, he immediately concerned himself very publicly with the quality of service. He made statements publicly that he was very concerned about the quality of service and its decline in all of the businesses. He also stated very publicly that he was equally concerned about the apparent gap between the quality of service as measured by the businesses and as apparently perceived by the customers. In that, too, I think he was right in expressing anxiety, because clearly, as the noble Lord, Lord Campbell of Croy, said in talking about targets of 93 per cent. of first-class letters being delivered on day B and so on, that might be the figure that the Post Office obtained from its own measurements, but it was not the figure that the customers actually perceived.

One of Sir William Barlow's first acts, having stated publicly that he was very concerned about the quality of service and wanted it looked at very carefully, was to set up a small committee of the Post Office Board that was charged with the job of examining the quality of service in the various businesses, examining the present methods of monitoring quality of service, by those businesses examining the gap I referred to between the quality of service as measured by the businesses and as perceived by the customer, and looking at those matters which impeded the quality of service or adversely affected it; and making recommendations regarding the collection of statistics on quality of service and report on quality of service statistics both to the Post Office and to the public.

When Sir William set up that committee he chose three members, and only three members, to serve upon it. He did, in point of fact, choose the three members of the Post Office Board with the least knowledge and the least personal experience of the Post Office itself. He chose me as its chairman and consumer representative; Mrs. Janice Walsh who was the other consumer representative and part-time member of the board; and Professor Michael Posner, an eminent economist but a person who had not had previous professional connections with the Post Office.

I am bound to say that our experience was that perhaps the chairman was wise to choose amateurs, in a sense, to take on the task. They would inevitably unearth all sorts of problems which the managing directors of the businesses had lived with on a daily basis for many years and knew all about. I think that it was helpful to have some very old problems looked at through new eyes, and slightly different eyes, so that those concerned with actually carrying out the job might perhaps look at them again. For example, in our first report to the board we referred to the importance of the Post Office paying a little more regard to the opportunities for the recruitment of women, bearing in mind that recruitment problems were, in fact, at the root of many of our difficulties as regards the postal services. We were able to remind the Post Office Board that the board itself, 11 years previously, had in fact taken a decision in those very terms. The immediate response by the board was, "Surely you are not trying to hurry us?" The point that I am trying to make is that it was not a bad thing to have some old matters looked at through new and rather amateur eyes.

After a couple of years of taking evidence, digging into the businesses, compiling reports and presenting them to the Post Office Board, Sir William publicly made it clear that many of the recommendations of that quality of service committee had, in fact, been accepted by the board and to my certain knowledge many of them were slowly being put into practice to the great benefit, in the long run, of the customer. Personally, I express regret once again that Sir William himself may not be there to see all those new developments through.

The noble Lord, Lord Campbell of Croy, referred, for example, to the very important matter of the monitoring of the pipeline and the waiting list regarding the installation of telephone equipment, particularly in Greater London. This was a matter of very great concern to the board, to the public and to those who had to wait. We investigated very carefully the way in which that waiting list was monitored and the way in which certain people were perhaps elevated in the list and certain people were perhaps kept down, and so on. I was glad to receive an assurance that the recommendations made by the consumer representatives on the board had, in fact, been taken on board by the business and were being put into effect. I think that, in the fullness of time, there will be benefits to the customer.

I said that I wished to make only one point. It is a very brief and general point. I shall say nothing about the success or otherwise of the experiment in industrial democracy with trade union nominated directors on the Post Office Board. It was clearly a difficult operation. To take a massive organisation with a very long history of deeply ingrained procedures for discussion and consultation at the grass roots, and to try to introduce totally new procedures for the board without there being changes at the grass roots, as it were, was perhaps not very likely to succeed.

However, what I want to say is that it is my experience—and I hope that at the end of the day when the facts are finally revealed your Lordships may appreciate this—that there really are possible benefits from the point of view of the consumer that can emerge from the presence of a very small number of independent and perhaps consumer-orientated representatives on the boards of large and major undertakings. People who can perhaps look at matters in a slightly different way bring a new dimension to discussions and occasionally remind professionals of matters with which they have long been familiar, but which they tend to overlook because they have been battling with them for so very many years. I wish to make that one point. While that experiment may not have been a total success in other ways, it was my honest opinion that the presence of some independent members on the board was useful from the public point of view. It is an example that could possibly be followed in other large public undertakings.

I wish to say no more about the many matters raised by the noble Lord, Lord Campbell of Croy, save that I agree with each and every one of them. They are matters of great public concern that must be tackled and they must be tackled at the end of the day by the businesses. However, I am sure that the businesses themselves would tackle them a little more speedily if they received some encouragement and perhaps pressure from the Government, and we may, in the fullness of time, hear a little about that.

4.27 p.m.

Lord ORR-EWING

My Lords, I think we owe a debt of gratitude to the noble Lord, Lord Campbell of Croy, for his initiative in tabling this Motion today. It seems to me that it is particularly well timed because I understand that the Government's White Paper is in draft and is due to come out around the middle of July. This is, therefore, a formative time when I hope the Minister, who is very helpful to us in this House, will take on board some of the constructive suggestions that come out of this debate and will incorporate them in the White Paper.

We should remind ourselves that the Government were elected about a year ago. They were elected on three proposals, particularly appropriate to this debate—namely, to encourage wealth-creating industry and especially the encouragement of small businesses; to reduce bureaucracy in the public sector; and, to hive off portions of the public sector which it was felt were better handled by private industry.

I personally wish to concentrate on the telecommunications side for two reasons. The first reason is that it is an area which I have grown to know something about—being an electronic engineer—and the second reason is that it is the life blood of a healthy and competitive industrial and business economy. If we do not have an efficient telephone service, we shall not get the business from overseas and we shall not have the communications which are essential today if we are to remain viable and profitable. That depends also on international telephones as much as it does on internal telephones. The third reason is that it is a very capital-intensive industry, but despite that it employs 233,000 people directly and, of course, tens of thousands more in industry manufacturing equipment for the Post Office.

My feelings about the Post Office staff—and I am sure that they are reflected by many noble Lords taking part in this debate—are that whenever I meet them I always come to the conclusion that they are extremely nice, on the whole very well mannered, patient and dedicated people whether serving on the postal side or the telecommunications side. But, I cannot help feeling that this dedicated staff is struggling to cope with an overburdened, over-large and rather archaic system, and is doing its best under those handicaps.

I wish to concentrate my criticism on four points. The first is productivity, which, unfortunately, as in so many parts of the public sector, is too low. The second is shortages and delays, which are very serious to business and particularly to new and struggling business. The third is the need to liberalise this monopoly, which has been part of our policy. Fourthly, if I have time, I should like to say a word on the capital investment programme.

First, let me say that productivity is too low. It is difficult to make judgments on this matter, particularly in a service industry. But the judgment by the Carter Report was based on the number of telephones per person employed. That is a source which is an international measurement, although I realise that it is difficult to obtain. The Post Office Review Committee—the Carter Committee—quoted figures which I am afraid went back to 1974–75, and no later. These figures were that the United Kingdom had 83 telephones per Post Office employee; Sweden had 126, that is to say, 50 per cent. more; Japan had 127, equally, 50 per cent. more; and the United States of America had 154, which was 100 per cent. more than our figure.

The Government White Paper published by the Labour Party in July 1978 accepted those comparisons and said that it felt that overseas comparisons were very valuable and should be carried out. The Government then announced that they had set up a joint working party between the Department of Industry and the Post Office to make these comparisons available. Therefore, I hope that when my noble friend replies he will tell us what progress has been made in the last two years and how soon we may expect some publication on the present position.

I should now like to say a few words on shortages and delays. This must affect everyone; it certainly affects the whole flexibility of industry and business. I want to take as an example the private automatic branch exchange, more commonly known as the PABX. The two popular categories—and there are other variations—are the PABX 1, for under 50 lines, which invariably means relatively small businesses and the PABX 7 for up to 100 lines. But there are typical delays of one year from the moment you ask for a PABX before you can get one supplied, and a delay of one and a half years is not uncommon. It is no good the Government saying that they are going to encourage the creation of small businesses by every means possible and are going to encourage the job creation which they will afford, if there is no possible chance of a company getting a telephone system in under a year. In fact, the application for a PABX nowadays is more like taking a ticket in a lottery; one may come up early and one may not come up for a very long time.

There were understandable reasons why the Post Office did not re-order the current designs. They had a new system coming along—Herald for the small business man and Monarch for up to the 120 extension customer. Field trials are about to start. Any business which is not on the field trial list may have to wait two or three years for the new system. The Post Office stopped ordering the old types believing—and understandably believing—that as industry expanded the smaller PABXs would become available and they could be supplied to the newer businesses, and the old ones could be slowly phased out. That has not come about; it simply has not happened. But with delays which may be two or three years for the new business, why not let in other manufacturers? There are other people who could provide PABXs to Post Office require- ments. Why keep it to a small number who have long had orders from the Post Office?

This leads me to the third point of liberalisation. Other countries have found it necessary to liberalise their Post Office monopolies. In recent years France has made tremendous progress in this field and, of course, the United States of America is always the leader. I believe that this monopoly has remained sacrosanct for too long. Of course, the recommendation for greater liberalisation has come from a whole host of reports. The natural area where the monopoly should continue to exist is, of course, in the provision of cables. We cannot have competitive systems there, particularly with the new type of cables—fibre optical cables—which are being introduced. Let all the terminal and exchange equipments remain in Post Office hands.

But I believe that the customer's equipment could be much better manufactured, supplied and tested by the private sector. Of course, I recognise—as have the various reports—that a committee would be needed to ensure that the equipment to be attached would not in any way harm the integrity of the network. I would suggest to my noble friend that if there is to be a body to judge between the equipment made in the private sector and that made within the Post Office, it should be an independent committee. If it were to be under the auspices of the Post Office, there would be the suspicion that the Post Office was dragging its feet when competitive equipment was offered for test. Other countries do it, so why not us?

I should like to turn for a moment to the field of research and development. Dollis Hill was on the edge of my constituency of North Hendon, so I used to visit it from time to time. Now, of course, it has overflowed its boundaries and its main spin-off is at Martlesham near Ipswich. A noble Lord who visited it recently, told me that he was excited by the work being done by some 600 qualified people at Martlesham. What is sad is that few of those people genuinely thought that their exciting and stimulating developments would ever see the light of day, would ever be taken up, manufactured and sold. They believed that there were possibilities and potential, not just for use in this country but, above all, for the export trade. For if we are not up with the rest of the world in our attachments and in our Post Office services and exchange equipment, we shall not export in a highly competitive area.

These 600 people have had some pretty good results. It was at Dollis Hill that the whole science of fibre optics was initiated. We are going to start it here in a limited experiment. Already the Americans have taken up the idea invented in this country. Japan is now working assiduously on it and expanding its use. Here we are with yet another invention, in this case by the Post Office, being belatedly slow in its development.

I am afraid that this is the natural result of an enormous monopoly organisation. That is why I especially press my noble friend to let in the winds of competition. After all, the Post Office should be encouraging innovation all the way—everything from the simple and competitive telephone in our home to devices like integral moderns, visual display units, teletypewriters and all the forthcoming contrivances of computers, which eventually, of course, will be available in our homes and may well be plugged into the telephone networks.

Surely we ought also to extend the use of telephone jacks. It is done in one area already. If you want a message recorder, you can buy your own with the degree of sophistication that you require and one that fits your purse; having got the one that suits you best, you plug that into a jack at home and then it works. Why should not that sort of thing be used in other fields as well? It would avoid the need for a Post Office engineer, or perhaps two, coming and making the connection, with all the time-wasting that is involved when someone is not in and not available.

In the United States of America they have Post Office shops. Ought not we to have Post Office shops? We have an electricity monopoly, but we have electricity shops. Some equipment is especially manufactured for that monopoly, but a great deal of other competitive equipment is also marketed by their shops and is also available from other sources. How much better to go in and buy your telephone; choosing the colour and the type you want. You could have a late-Victorian or Edwardian design, if that is what you want. You simply pay for it, take it home and plug it in. This would introduce some competition into a field where competition and innovation is absolutely essential.

In The Times recently a letter was published about the telephone service in the United Kingdom, comparing its performance with the performance of the telephone service in the United States of America. Mr. Charles F. Hankel wrote: I rented an apartment in Houston, Texas, and was able to move in within a week of my arrival … My telephone service, installed within 24 hours, allowed me to make calls, by direct dialling, to any part of the world. I was able to divert my calls to other numbers. I was able to store the larger or more commonly used numbers and recall them by dialling a two-digit code. I did not have to pay for local calls. I received a detailed list of all long-distance calls, showing the number dialled, the date, time, length and cost, including the name of the town. I could use any telephone in the country, quote my name and telephone number, and have the call charged to my own number". Those are the facilities which are perfectly possible, and you could have them here with a little more drive and dynamics, and with a bit more accord and sympathy for the innovative processes.

I should like to say a word on capital equipment. I do not know whether it is right or wrong that Sir William Barlow resigned because he felt that he was not able to get the capital investment which he deemed necessary. I know that he was an approachable and I think efficient person to head our Post Office, and we owe him a debt of gratitude for what he achieved in his three years of service.

I note when I look at the very well edited and prepared Post Office Report and Accounts that the capital expenditure—and it is also in the Carter Report—has been falling off, in real terms. We all these days have to reduce our accounts to real terms if we are to be realistic. Capital expenditure and capital investment in 1970 was £372 million. In 1979–80 it was £997 million. That looks an impressive increase, but to look at it in real terms it was £372 million in 1970, it peaked at £488 million in real terms in 1973–74—I may say the last year of a period of Conservative Government, which shows our far-sightedness—and it has now deteriorated from £488 million down to £262 million. On a rising expenditure, and the need for these services to be improved and with the installation of System X, are we right to restrain capital expenditure to this degree? more particularly, because it is self-financing.

In fact, in the last year, 1979–80, not only did they finance all their own capital expenditure but they paid back £296 million of their long-term borrowing, so there was a net gain to the PSBR, minus £110 million. This year it is forecast in the Government White Paper that there is going to be £65 million which is not covered from their own resources. So even then it is a small extra call on the PSBR—very small. I know that, like the housemaid's baby, each requirement is a small one and therefore need not be worried about, but they all add up to something much greater. But it is £65 million, and the statement in the Government's White Paper on public expenditure (page 148) says quite clearly that, by and large, the Post Office will finance all its own capital investment requirements up to the year 1983–84 from within its own resources. I would ask my noble friend to look to see whether this is true. Perhaps he could tell us in his wind-up speech whether this is right or wrong. Certainly I would not wish to see the Post Office telecom side starved when we are so anxious to encourage the efficiency of this sector.

Lastly, I come to the future. I do not believe that we can go on starving our requirements, our home demand, in this way. This was brought out in the admirable paper, a copy of which was sent to the Minister for Industry in the middle of March, compiled by the Association of Telecommunications Users. I have not got time to cover all the points. They said: There have been reports of foreign companies which have abandoned plans to set up offices in the UK, particularly in the City of London, because they have been told by the Post Office that they will have to wait over a year for a PABX. The supply position on Post Office PABXs has been so bad for so long that no promises from the Post Office can be taken as justification for delaying the removal of the monopoly on PABXs of up to 100 lines. The Associations suggest this should be done as a matter of urgency". If we wait for a Government White Paper in July, it means we shall have to wait until the next Session of Parliament for a Bill to liberalise the industry and cover certain other reforms which I and my noble friend have suggested. Could I ask my noble friend to take note of the suggestion at the bottom of page 19 of this report, where it says that something should be done now even before the White Paper in July? It says: Should the Post Office be unwilling to concede these points in advance of legislation"— that is, the liberalization— the Associations would strongly urge the Secretary of State to issue a directive under the terms of Section 11 of the Post Office Act 1969". We have the power. If we all believe that we need to expand our industry and the efficiency of that industry, let him go ahead from today and do so.

4.46 p.m.

Lord RAGLAN

My Lords, I want to draw attention to two matters which, although they may appear to be small, in fact have the capacity vitally to affect the quality of Post Office service, and closely affect the users of telephones and the writers of letters; namely, the telephone and postal codes. In making my criticism I may say that although it appears to me that perhaps there is sometimes a tendency on the part of the Post Office to forget that it is there to provide a service—and possibly the noble Lord, Lord Orr-Ewing, is right in saying that the telephone service is not as much on its toes as it could be—there are many firms, small as well as large, in the private sector which in my experience are far worse in their outlook than the Post Office, and whose attitude to their customers is one of casualness amounting to superciliousness, as if it were demeaning and humiliating to provide a good service, and as if they were in business to please only themselves.

In fact, the giving of poor service has become something of a British disease, and that attitude may be at the back of a lot of our industrial difficulties. Generally speaking, judged by the contemporary standards in private industry, I fancy that the standard of service which the Post Office provides is really not bad. It may be said that the Post Office needs competition, but I should claim that good service is not necessarily prompted by competition. Besides, if, as the noble Lord, Lord Orr-Ewing, would like, bits of the Post Office were hived off and the services which the Post Office supply were open to competition, unless that competition is carefully restricted the results would be to cream off the most profitable bits, leaving the Post Office to struggle with the unprofitable parts. That would be bad for the taxpayer, bad for Post Office morale, and bad for efficiency.

We should give praise where praise is very much due. I am told on good authority, because I am not a stamp collector myself, that the Post Office leads the world in stamp design and is internationally acclaimed for it. Let us give a cheer when our industries lead the world in something. It would, however, be surprising if some of the current British take-it-or-leave-it attitude had not rubbed off on the Post Office somewhere. For instance, I suspect it is not purely a reflection of the Post Office's monopoly position that a telephone set with keys, rather than with a dial, and for which an extra quarterly charge is made, is offered only in a two-tone confection of mud-grey, and it is tidal mud-grey at that! I find this very unimaginative.

It would not be a good enough defence to declare that the private enterprise founder of mass production, Henry Ford, is said once to have offered his customers any colour so long as it was black. People are cleverer nowadays at making variety, and the Post Office should try to do so as a matter of principle. And if, as he threatens, and as the noble Lord, Lord Orr-Ewing, hoped, the Industry Secretary makes legal the use of all kinds of foreign handsets that are now available, I fear that the Post Office will have only itself to blame; it could have done lucrative business in encouraging a variety of its own designs. Now imports will start to flood in and British firms will be behind, as usual, all through what can only be called a lack of imagination.

Perhaps it is not far from that kind of lack of solicitousness about the customer's choice to the inventing of codes which, for all that they may be ingenious, are difficult for customers actually to use. With the telephone codes, at least the STD codes have the virtue of being the same from wherever you are making a call, although you must check another directory to see whether it is to be a trunk or local call. But the length of some of the numbers one is asked to dial is bizarre. It is quite common to be faced with having to dial 10 figures. That is enough to find one of 10,000 million numbers on one exchange alone. Yet whether one wants to remember a telephone number or write it down, every extra digit means more time spent, more difficulty and more possibility of inaccuracy. As for the local codes, they are astonishingly inconveniently planned, for the code of an exchange will vary according to the local exchange from which one is ringing, and all of them, like the STD codes, vary in length and rhythm and are likewise difficult to remember. There is, therefore, no point in trying to write down these local codes or trying to memorise them because one is fooled if one does not have a code book handy.

I do not think the noble Viscount, Lord Trenchard, need tell me why, when dialling from my local exchange at Usk to neighbouring Raglan, I need to dial nine digits; that is enough for an exchange of 1,000 million subscribers. Nor do I need ask him to explain why we have telephone codes of such amazing complication. I think I already know the answer. It is that whoever devised these codes is removed from all the common tasks of life by his secretaries, and when lie is at home his loyal wife does the telephoning. The task of designing a good and sensible code plan needs to be given to someone whose concern it is to give us a system which is as brief as possible, comprehensible, easy to memorise and simple to use. My suggestion is that there should be area codes—or code areas, in a word—designated by counties perhaps, so that when dialling into the area you use the area prefix, and when dialling within the area you do not use the prefix. This system operates in London and over the whole of the United States. Probably there is an unnecessary number of digits that must be dialled, but it works well and everybody understands it. Yet those of us who live in the provinces are foisted off with this other system.

One virtue of having code areas would be that sheer distance could cease to be quite the overriding consideration it now is when computing the charge, which is as it should be now that our telephone system is catching up technologically. In addition, we should be able to abolish the need for two directories, one for the number of the subscriber and one for his code. I do not say that the present arrangement was designed so that one forgets a subscriber's number while going to look up his code, but that is the effect of the system and what all too often happens, unless one writes it all down. It is one more example of how our provincial code system was not devised with the convenience of customers in mind.

The same sort of remarks apply to the postal code. I have seen some advertising plaintively asking us to use the postcodes. I wonder whether the Post Office has ever asked itself why people do not use them. It is mainly because nobody can remember them. They are a peculiarly fussy and strikingly unmemorisable combination of letters and figures. You are lucky if you can even remember your own. I believe the code to be so exact that a letter might reach your house almost without the benefit of human agency, if it could, and that seems to be a case of attempting to go too far with automation, by expecting too much of it in this application. It is certain that the Post Office will never be able to do without postmen to carry letters and parcels. Surely postmen can be counted on to know their districts, and therefore the kind of theoretical exactitude we have now in the postcode is unnecessary

If we must have postcodes—and if, as the noble Lord, Lord Campbell of Croy, said, action is required on them now—please may we have them as simple as possible both to write and to remember? Surely short, all-figure numbers, like other countries have, would be quite adequate. As things are, I think I can confidently predict that not enough people will be persuaded to use postcodes to make the scheme work. That will not be the customers' fault. It will be the fault of the Post Office for trying to institute a code for their own notional convenience without thought first being given to the convenience of users, whose co-operation is essential to its working. There is no doubt that customers would like to help the Post Office give a better service. My advice therefore to the Post Office is that they should drop the present codes and start again thinking of us, their writers and customers, whom they are asking to use these codes. I am sure they will find that such consideration will greatly help them in the improvement of their service.

4.58 p.m.

Baroness ELLIOT of HARWOOD

My Lords, I have listened with enormous interest to the technical and excellent speeches that have been made, and we are indebted to the noble Lord, Lord Campbell of Croy, for initiating a debate on this subject. I rise because I have always had great respect for the Post Office and postmen who, from my experience, do their best to serve the public individually—because the postal service is, for most people, a personal service. Of course it deals with vast quantities of mail and enormous distances—involved are long-distance communications and all the other matters which have been excellently described by, among others, the noble Lord, Lord Orr-Ewing—but the everyday postal service is for ordinary consumers a personal service, and often when the post arrives their jobs and duties for the day are revealed to them. So I believe that on the whole each person really judges the postal service by the delivery service of which he has experience every day.

We cannot deny the fact that there has been a deterioration in the everyday postal delivery, but from my experience this applies more in the cities than in the rural areas. Why that should be, I do not know. Perhaps in rural areas the people who receive the mail are more personally interested in the delivery and in the postmen, most of whom are very friendly and bring news from the other areas in which they operate, which may be a neighbouring village. Very often they discuss subjects of local interest, whether in the agricultural world, the sporting world, or whatever. I believe that on the whole in the rural areas the local interest in the services which are given by the postmen is greater than in the towns.

Postmen bring not only letters, but very often news, because news travels just as well by word of mouth as by letter. In the cities the situation is very different. There it is not so easy to take a personal interest in the postman because our letters simply drop through our postboxes in the morning, and it is only on those occasions when the postman is unable to get a large letter or a parcel through the letter box that he rings the bell and one has a conversation with him. In the countryside there is a personal aspect which I believe helps the postal service.

Of course this is a very small part of the mail service, but the influence of service conditions plays a great part in the recruitment of personnel for the Post Office. I have the feeling that it is easier for the Post Office to run its services in the country districts than it is in the cities.

I fear that I have not read as many reports on this subject as has the noble Lord, Lord Orr-Ewing, or one or two other Peers, but I have seen one memorandum and there seems to be a contradictory view about the recruitment of postmen. One document that was sent to me to read states that about another 7,000 postmen are needed, but another memorandum reports that the postal services are overmanned, though admittedly it may be a highly labour-intensive service. I should like the noble Viscount, when he replies, to deal with the question of recruitment to the postal services, and say whether we suffer from over-manning or under-manning. One memorandum I have says that it took 1,900 more personnel in the postal business than it took in 1973–74 to deal with one million fewer letters. If that is correct, it is certainly not encouraging.

Naturally the great interest in the postal charges arises from the actual cost, and I can well realise that with the huge increase in the cost of posting in this country there will be a reduction in the number of people who write letters. But I do not want to see the postal service cut down. It is still vital to the economy. No doubt new methods could improve and help the working of the service, and I hope that the Post Office union will co-operate in the new services because I am sure that at the end of the day this will be to the great benefit of the Post Office personnel as well as to those of us on the receiving end. None of us wants postmen to be exploited and their conditions of work and service are vital matters but efficiency must be a criterion of service since the costs involved are so enormous.

I should like to stress the great importance of the village post offices. They provide many vital services to the com- munity, and I believe that any thoughts about trying to cut down these post offices on grounds of cost would not be justified. I am sure that the service that the local post offices provide for the public cannot be provided if instead the post office is miles away and people thus find it impossible to get there to collect their pensions, postal orders or whatever they want. So I strongly support the view, which I believe has been expressed on many occasions, that the rural post office should be retained.

Telecommunications, which have been discussed by the noble Lord, Lord Orr-Ewing, are a very different proposition. Telephones have revolutionised the countryside, and have brought about much speeding up, but there is still a very long waiting list for telephones; and of course the cost is very great. However, it seems that people must want to have telephones installed, since there is a long waiting list, certainly in the country areas. Overcoming this problem would provide more customers and more money for the Post Office, and should be given high priority.

Another group of people for whom telephones are of enormous assistance is the old-age pensioners. If they have a telephone, many old people are enabled to live on their own. They can contact relations or friends when in trouble. Otherwise they would be unable to live on their own, and it would be much more expensive for everyone if they had to go into old people's homes. In this regard I should like priority to be given to old people, where conditions allow, so that they can remain independent as long as possible.

I shall remain a staunch supporter of the postal services, but there must be a great effort by all concerned to stop the deterioration which has been described by other noble Lords, and to improve the service again. I believe that better relationships on all sides would help, and I only hope that this can be accomplished.

5.7 p.m.

Lord MORRIS

My Lords, in investigating this subject I have found the legal and historical background underlying the creation of the Post Office monopoly of telecommunications not only fascinating but illustrative and instructive, too. The efficacy and potential of telegraphy leaped dramatically to the public notice during the Civil War in the United States, and it is certain that defence implications, among others, of its use inspired the provisions of the Telegraph Act 1863—the first of many enabling Acts—which provided, inter alia, that If One of Her Majesty's Principal Secretaries of State requires the Company"— that is, the telegraph companies coming within the ambit of the Act— to transmit any Message on Her Majesty's Service, such Message shall … have Priority"; and, further, that, On the Request of the Board of Trade, the Company"— which subsequently became the Post Office as well— shall … place … such a Telegraph … to be for the exclusive Use of Her Majesty". Furthermore, the Act provided that, In Emergencies Telegraphs may be taken possession of for Her Majesty's Service". Subsequently the Act of 1869 provided—I am not quite sure how this extension came about, but it is fundamentally an administrative point, rather than a defence point—that, The Postmaster General … shall … have the exclusive privilege"— I stress the word "privilege"— of transmitting telegrams within the United Kingdom of Great Britain and Ireland". It is from these Acts that the current law stems.

I was most interested to note that in a report written on the centenary of the International Telecommunication Union, the authors were forced to state that, In Britain, the development of the telephone was at first greatly hampered by the Telegraph Act of 1869 by which the Post Office had acquired the monopoly of all telegraphic communications …". Very little has changed in over a hundred years!

This exclusive privilege is maintained to this very day by virtue of the Post Office Act 1969, Section 24, under which the Post Office enjoy "the exclusive privilege" with respect to telecommunications. If one looks back to Section 9, however, one might possibly raise a horse laugh by reading that: It shall be the duty of the Post Office … to meet the social, industrial and commercial needs of the British Islands … and, in particular, to provide throughout those Islands … such services for the conveyance of letters and such telephone services as satisfy all reasonable demands for them". However, in conjunction with the foregoing one must read subsection (4), which reads: Nothing in this section shall be construed as imposing upon the Post Office, either directly or indirectly, any form of duty or liability enforceable by proceedings before any court". It is some duty where the customers have no legal recourse in regard to the duty imposed! There is also the very strange anomaly that, also according to the Act of 1969, In discharging the duty imposed on it by the foregoing subsection, the Post Office shall have regard"— it is not a duty, but they must "have regard"— to developments in the field of communications …". So we see what the position is quite clearly. There is no duty to provide any telecommunication services, and yet they have exclusive privilege to control. The result is that we are very behind the times in the field of telecommunications, and by that, of course, I do not mean only telephones; I mean radio telecommunications and all the message services which are of course extant these days. That is why I most warmly welcome the Government's decision to relax the operation of the Post Office's telecommunications monopoly. The monopoly is not only out of date, but is counter-productive. Indeed, the Secretary of State for Industry stated that Her Majesty's Government shared the Carter Committee's view—and this is a straight quotation by the Secretary of State from the Carter Committee Report — that they were not convinced that the balance of advantage to the community favoured the continuation of the existing boundaries to the Post Office telecommunications monopoly". He went on to say: … we want to see greater freedom for the provision of all kinds of added value services on telecommunications circuits. Subject to safeguarding the technical integrity of the system, we also believe that it is in the national interest to provide greater scope for competition in the supply of apparatus for attachment to the network". This view must be correct. I think it is quite well illustrated because centralised State planning by one customer—namely, the Post Office—has, as I believe, not served Britain's best interests. If State planning and a single customer was the answer, then the USSR should have led in developments in telecommunications and electronics, rather than the free enterprise countries. We have seen that regulated—and I stress that word, "regulated"—private enterprise in the telecommunications field has enabled American industry to develop competitive products and has created a vast market in all areas of telecommunications.

Indeed, the experience in the United States shows that the combination of freedom for attachments and peripheral equipment, independent common carriers and added value services has resulted in increased efficiency without drawing upon precious national financial resources; has increased traffic on the public telephone network with resultant profit; has created new employment in communications installation, maintenance and added value services; has expanded manufacturing, research and development and export production; and has increased competition, resulting in higher quality and grade of service to the customer.

With respect, I would suggest the immediate transfer of the monopoly powers under the Post Office Act to the Minister in the Department of Industry. The Minister should be empowered to license organisations providing added value services; sales, installation and maintenance of attachments and peripheral equipment to the public telephone network; and common carrier services. In addition, a communications authority should be formed, responsible to the Minister, to provide central direction and regulation of all forms of communication. There would of course be an additional benefit, in that a plethora of Quangos and (if your Lordships would excuse a terrible phrase) quasi-Quangos could be merged with or eliminated by the creation of a single communications authority.

Such or similar changes are vital to the health of the nation. The sweeping changes which are occurring in technology and society make it essential that the regulation of communications is removed from the existing historic framework. The rapid development of computers and micro-chip processors are causing the merging of many traditionally separate sectors of administration and communications. Information processing and automatic switching using digital techniques are changing fundamental concepts of communication. The rapid development of technology requires regulations which clearly take account of electronic realities and must ensure equity to all communication users to prevent 19th century regulations being used to retard progress and cynically permit multinationals and State monopolies totally to dominate and exploit these advances.

Turning specifically to radio telecommunications, the radio frequency spectrum could be seen to be one of the nation's resources, and, unlike fossil fuels, it cannot be exhausted. It is important that the regulation and management of the spectrum ensures that full use is made of this freely available resource. It is inappropriate, for reasons which I have already stated, or for similar reasons, for outdated Government regulations and practices artificially to prevent the efficient and (I stress this word) responsible use of the radio spectrum. Your Lordships will appreciate that Government decisions on the radio spectrum have historically been dominated by broadcasting and military interests. It must be accepted that the defence of the nation is paramount and that adequate radio frequencies should be available to the defence forces.

In the case of broadcasting, the public are entitled to expect adequate information and entertainment within the economic restraints of the nation. However, Government regulators have allocated and assigned the majority of the spectrum to these services without due regard to the actual use of the radio spectrum. Civil radio communication services are currently allocated less than 8 per cent. of the spectrum below 1,000 megaherz. The practical matter of the two largest services using the spectrum allocated to them is that fundamentally it is impossible for the broadcasters or the defence forces physically to fill the spectrum with working systems. Optimum use of the spectrum involving the sharing between broadcasting and civil radio communication systems is entirely practical but needs a communications authority to co-ordinate and to regulate it.

My Lords, I have spoken for far too long. I should like to finish by thanking my noble friend the Chief Whip for ensuring that I did not speak after my noble friend Lady Trumpington, because she is quite impossible to follow. I beseech your Lordships to stay, because I know that we are all in for a treat.

5.20 p.m.

Baroness TRUMPINGTON

My Lords, that is the most terrifying remark to stand up to; but I thank my noble friend for it. I, too, greatly welcome the opportunity provided by my noble friend Lord Campbell of Croy to discuss the quality of service provided by the Post Office while longing to join him in wringing the neck of that beastly little bird Buzby. I intend to confine my remarks to the specific question of Britain's air mail service. Private individuals and members of the Air Transport Users Committee of which I have the honour to be chairman have become increasingly worried about the deterioration in the quality of Britain's air mail service. As individual users of air mail for either personal or business communication, we know that postal charges have been rising at an above-average rate even for inflation-prone Britain and at the same time it seems clear that the quality of service is diminishing. In the era of propeller aircraft it was usual for overseas mail to be delivered within a matter of days; today, with air journey times halved by modern jets, overseas air mail seldom seems to take less than a week.

In 1978, the Air Transport Users Committee decided that the time had come to do something about it. Then we ran into an unexpected problem, it was very difficult to find out what was happening. To some extent, this was due to a certain secretiveness on airline matters among the few organisations which are closely involved. But, also, it reflected the fact that nobody had studied Britain's air mail in recent times and there was consequently a dearth of background information available to users.

As a first step, we invited a well-known air transport economist, Mr. John Seekings, who has made a special study of cargo matters, to carry out detailed research on our behalf and to report back to the Air Transport Users Committee. His report confirms that air mail is indeed a complex business. The report also confirmed our fears that all is not well. Two particular aspects strike us as being of fundamental importance. First, it seems that the Post Office does not give air mail the care and attention it deserves, possibly because of the greater economic appeal of international telecommunications; secondly, it seems that a cross-subsidy of one class of user by another has become a widespread and undesirable practice and, as a result, many users are having to pay more than they should for air mail.

I should like, if I may, to enlarge upon these two conclusions as well as touching on other aspects of the whole air mail service. I hope that your Lordships will understand that at times I will be quoting from the report I have already mentioned. I fully appreciate that air mail is a secondary element in the total mail operation. Furthermore, there is a division between letters and packages. Nearly all overseas letters now move by air and make a profit for the Post Office. However, it seems that overseas air mail is not accorded the first-class status it deserves within the United Kingdom. Frankly, I find this scandalous. I should like at this stage to say that POUNC cooperated enthusiastually with the researches made by the Air Transport Users Committee but we learned from them that owing to limited resources they have been precluded from detailed consideration of overseas mail. The Government may well consider commissioning a special study by POUNC of both price and delivery performances of our air mail service.

My Lords, I will now turn briefly to the question of our parcel post. Postal authorities in most countries have always been under intense, and understandable, pressure to promote the export of printed paper, and as a result the situation today is that most postal authorities are incurring massive deficits mailing books and periodicals overseas at special discount rates. This international competition in mail subsidy continues apparently to be acceptable only because the losses on discounted printed papers can be offset by profits from protected letter traffic and quasi-protected parcel traffic or by direct Government subsidy.

From the viewpoint of Britain's publishing industry, for instance, competition from its main international rival, the United States, is particularly severe. Under these circumstances, the legitimate effort of the British Post Office to raise rates for printed papers to economic levels while the United States Post Office continues to be prepared to subsidise American publishers creates a very real problem. That problem is that even though rates from the United Kingdom are substantially higher than those from most other competing countries, the Post Office is still incurring a substantial deficit. Quite simply, Britain's publishers appear unable to bear the level of postal charges which would be economic for the Post Office. The Post Office is therefore maximising its profit on other postal activities to offset this deficit.

The concern turns on the fact that if airmail rates are held artificially high in order to cross-subsidise surface mail, then the growth of air mail is significantly impeded. It is possible that the relatively slow growth of air mail letters and parcels in comparison with competing media could have been caused to some extent by artificially-high postage rates. Unfortunately, the Post Office refuses on grounds of commercial security to make available for independent scrutiny the economic information which is needed to evaluate this situation objectively. All that can be said is that informed guesswork strongly suggests that certain categories of air mail parcels in particular and, possibly, long-distance letters appear to be suffering from excessive postal rates.

My repeated use of the word "seems" and the phrase "appear to be" brings me to the last point which I feel needs emphasis. Because some of those involved in air mail service were not willing to furnish specific information some of my conclusions cannot be verified. If the Post Office is to continue to enjoy its traditional monopoly then it must recognise that public accountability is part of the price that it must expect to pay. The split of the postal and telecommunications businesses is to be welcomed in that the proper development of all mail services, but especially airmail, can take place without inhibition. I submit therefore that airmail could be developed in three parallel ways: a regular airmail service with dependable delivery times; an express airmail facility at a premium price founded on a firm economic footing, operated either by the Post Office and/or private enterprise; and, finally, an expansion of an accelerated surface post facility into a general form of second-class airmail.

5.29 p.m.

Earl FORTESCUE

My Lords, may I join with others in thanking my noble friend Lord Campbell of Croy for giving us this opportunity to speak on the Post Office. I should like to speak briefly on one aspect only, that of the telephone service. I, myself, do not use the telephone unless I have to, and then only briefly. However, I have a wife and three daughters at home and I find that the telephone bill is one of the largest I pay, and certainly the one I most resent having to pay. I suspect that the British system involves more wasted time and frustration than any other modern system in North America or Western Europe. Wrong numbers particularly irritate me. Not only do they waste time but one is having to pay for unwanted calls.

The majority of calls to all parts of the world now can be dialled direct. I understand that these are recorded by a meter in the telephone exchange. As a subscriber, I also understand that one has no right whatever to check one's own meter reading. This is surely wrong and unfair. I buy electricity and there is a meter in my premises, and the same applies to gas and water. Why should not the telephone meter be in one's own house where one can read it in person if one feels so inclined?

If pressed, the Post Office will rent one a meter which can stand beside the telephone at home. However, the Post Office stress that the reading of this meter is unlikely to correspond with the reading of the meter at the exchange, as meters are not 100 per cent. accurate, and alterations are made to the reading on the exchange meter from time to time for technical reasons. I suggest that the whole arrangement is unsatisfactory and that every subscriber should be charged on the reading of a meter on his own premises.

The Post Office might well argue that this would involve the cost of extra men travelling around the country to read individual meters. I suggest that this could be easily overcome by asking sub scribers to report the readings of their own meters with periodic checks by official meter readers, who could at the same time read the telephone meter, the gas meter, the electricity meter and the water meter.

5.32 p.m.

Lord ALPORT

My Lords, like previous speakers, I am very grateful to my noble friend Lord Campbell of Croy because this occasion gives me an opportunity of making one or two points very briefly about an institution in this country for which I have had an affectionate interest for a good many years. I should like to start by saying that I fully agree with the Government's decision to split the present Post Office into telecommunications and postal services. The Secretary of State should be careful before he decides to dismantle the monopoly status of the Post Office as far as postal services are concerned. We should remember that the problems of the latter are to a great extent the problems of size; the enormous volume of mail which these days must be handled every day of the year. This is a problem which faces every postal service in the world.

Earlier this year I sent a letter to the rector of the Venerable English College in Rome. It took five weeks to arrive. The reply, to my surprise, was posted in Harpenden because, so my correspondent said, the delays in the Italian post were so great that they relied on giving their mail to some priest to bring back to England to post here. All the grumbles that we have heard this afternoon and which we continually see in the Press and elsewhere about the postal services, are grumbles which are reproduced in almost every country, not least in the United States.

I would remind my noble friend Lord Campbell of Croy that the cost of first-class post in the United States is marginally greater than here and the standard of service provided by the post in the United States is a good deal lower. Indeed, if my noble friend was living in Croy, Arizona, he probably would have to go once a week in his dressing gown and carpet slippers to the local post office to get his mail, whereas here no doubt he gets it delivered punctually every weekday.

To break the monopoly of the postal services will add to the financial difficulties of the Post Office. Above all, it would be a considerable discouragement to management, which is already harassed on the one hand by Government financial pressures, and by the continuous interference of Governments over a good many years, and on the other by the attitude of the trade unions to improvements in organisation and the introduction of mechanised methods. I remember 20 years ago seeing in Norwich the pilot letter sorting machines at work. Yet even today, 20 years later, largely as the result of the attitude of the unions, the distribution of these machines is far from complete.

The resignation of the present able chairman, Sir William Barlow, is evidence of the demoralising effect which contemporary pressures have on the Post Office management. He gave as a reason that there was too much exposure and too many constraints. The Post Office mangement are naturally sensitive to the volume of public criticism; they feel that they lack support from the Government, and they are only too well aware of the obstruction which they experience from the trade unions in their plans to improve the standards of public service which it is their job to provide.

The postal service is not simply just another nationalised industry; the postal service of this country has been the responsibility of the State for four and half centuries. I feel that any decision to break the monopoly would be doctrinaire and not conceived in the best interests of the Post Office. Over the years the revenue of the Post Office has continually been milked to provide in earlier days an income for royal mistresses or a pension for some public figure, and latterly as windfall for the Treasury.

If we want to improve the standard of service, the first thing necessary is for the management of the Post Office to receive the financial and moral support from the Government which any body of men who carry the heavy responsibility for running a public service must expect—a public service without which the Government administration would collapse. Morale in my view is vital. The present attitude of Ministers and of Parliament to the Post Office management has gone far to undermine this in the case of the body of extremely able men and women in the postal service.

When there was a Postmaster General—to say nothing of an Assistant Postmaster General—a Minister was available to stand up in Parliament to explain and defend and, where necessary, to direct and encourage the Post Office management. He took what Sir William Barlow described as the exposure, and no doubt at the same time he was able to overcome some of the constraints. In my view, there should be a Minister of State at least in the Department of Industry responsible for the postal services. I personally should like to see the postal services become part of the Civil Service once again. It is not an industry in the normal sense, it is and always has been a Government service which, in the course of time, the private citizen has been able to use.

In a period of high wage inflation and as a labour intensive service in which only a limited amount of mechanism is possible, the Post Office has very special problems. My noble friend Lord Orr-Ewing referred in particular to the other side of the present postal administration: telecommunications. This is entirely different. With the application of fibre glass to telephone cables, the introduction of the microchip and with the development of System X, this industry—and that is an industry—has a prospect of technological progress between now and the year 2000 which will represent a major revolution.

However, in order to achieve this, it must have the capital resources at its disposal to introduce the improvements and the modernisation which no doubt is necessary and which at the present moment I know is possible. But the problem really is that if the Post Office or the telecommunications corporation has to develop from its own capital resources or from what it can obtain by loans, it will take a substantial period of time before these improvements in the quality of the service can be introduced.

I agree with my noble friend Lord Orr-Ewing that it is not wise or necessary to maintain the present monopoly as far as telecommunications are concerned; but he knows as well as I do that to open the market fully to any standard of equipment which any customer in a shop would wish to buy to attach to his telephone can quite easily damage the standard of service that the telecommunications corporation can produce. Indeed he said that in his speech, and I think it is very important to bear that in mind. It is all very well to say "Let us throw it open to full competition", but the truth is that on the telecommunications side the Post Office has maintained a very high standard of equipment and service up to the present, and they are very anxious not to see that deteriorate with the introduction of all sorts of new instruments and gadgets which may affect the general service.

The delivery of letters, from the Inland Revenue's income tax demand to a birthday card for one's youngest grandchild, will continue to depend upon the human factor—the welfare and morale of the hundreds of thousands of men and women from the chairman down to the post lady with her bicycle who plods devotedly along the village street each weekday morning to deliver the mail and which has always seemed to me to be a miracle of organisation, which is very important.

I therefore support the decision to divide the Post Office into two parts: post and telecommunications. But I would vote against breaking the Post Office monopoly. I implore the Government, and particularly the Secretary of State for Industry, to try to get a better understanding of the nature of the problems of the postal srevice and to give to its management and workers the encouragement which has so evidently been lacking in the attitudes of successive Governments in recent years.

5.42 p.m.

Lord SKELMERSDALE

My Lords, I have not had occasion to mention the details of my small horticultural business before in this Chamber, but since my third largest item of expenditure, as a retail mail order organisation, is on the Post Office and since the expenditure will be something over £10,000 this calendar year, I thought that perhaps this might be a suitable opportunity to come in on this most important debate initiated by my noble friend Lord Campbell of Croy.

My noble friend was indeed critical of the Post Office in his speech, but you will see from what I have to say that on the whole I am a satisfied user of the mails side. This may point up some of the dichotomy referred to by the noble Lord, Lord Winstanley, between business users on however small a scale and private users of the mails side of the Post Office business. As I say, my remarks will be largely confined to that.

First of all, my respect for the sales side of the mails side has grown by leaps and bounds ever since I first had a visit from the local Post Office representative, who suggested my using the two-tier contract service for parcels and letter packets. This means in effect that parcels are bulk-weighed and you pay so much per kilogram and also so much for the individual parcels; so you only have to count them and put them on a spring balance. You do not, of course, get involved in sticking on stamps, which is a great advantage when you are hard pressed in a busy packing season, especially this year when sales have been delayed by copious amounts of rain in the early spring. Just recently I have heard of a another type of contract which is based on a single amount per parcel, but I would rather doubt that my own scale of operations would be large enough to justify that system from the Post Office's point of view.

Surely any service is entirely and absolutely dependent on the people who are actually doing a particular job at a particular time. Most of my consignments are packed in padded bags, of the kind normally used for books; and occasionally one gets rapped over the knuckles by a customer because the postman has tried to put a bag through a letter-box which is too small. I would doubt whether the Post Office as an organisation is to blame, except possibly in their training courses where this point may not be aedquately dealt with. I personally have no experience of what goes on in training courses for postmen.

I am also delighted with the Post Office's new free compensation scheme, as very occasionally a parcel is delayed in transit and plants are received in a soggymess—which does not do my business any good and does not do the Post Office much good either. Even more occasionally, they go missing altogether. But a complaint of that kind, which one does hear of from time to time, has to be put into perspective. In the last eight months we have posted about 9,000 parcels or packets and we have only had occasion to contact the Post Office four times on this score. According to my usually rather shaky arithmetic, that works out at 0.04 per cent., which I would have thought was a negligible amount and an acceptable risk in most cases. Certainly it is well under the Post Office's own published figures.

Moving from the particular to the general, what exactly does one want from the Post Office?—obviously a speedy, efficient service at as small a cost as possible. In my own experience, speaking generally, we are getting the speed. Parcels for Yorkshire in the last fortnight, for example, have been taking three or four days, which I think is quite exceptional. Never have we had occasion to complain that a parcel has taken more than nine days.

From the Post Office's point of view, I agree with my noble friend Lord Campbell of Croy that we would get much more if the individual postman did not have to walk up garden paths—they do not do this in the tropics and in many other parts of the world, as has already been referred to this afternoon. Perhaps help could be given by providing a post box at the road-gate of houses in country districts but also on new housing estates, where a postman has to walk up and down garden paths with a resulting loss of time.

Indeed, but for the outcry which I am sure would ensue from the general public, one could extend this idea. I suggest that blocks of post boxes could be erected at suitable places which would not be more than five or, at the outside, 10 minutes' walk from any particular home. That would speed up delivery dramatically, and I personally think it would provide a social service and a modicum of much-needed exercise for many people, who would have to walk for a few minutes to a post box and back to collect their particular bundle of post, if any. That, of course, is where the bugbear would be found. If you went for a five-minute walk in the rain only to discover that there was nothing in your postbox, you would be absolutely livid; but of course one always has to take the swings with the roundabouts.

I wish, unlike the noble Lord, Lord Raglan, that more people would use the postcode, although I am told there is only one sorting office which has the machinery fully operational to use it at the moment. Even quite small mail order businesses and other business have sufficient post at certain times of the year to take advantage of the bulk mailing rebate scheme. For example—

Lord RAGLAN

My Lords, may I intervene for one moment? I did not wish more people not to use the postcodes; I was objecting to the kind of postcode we are expected to use. I fully support the use of the postcode.

Lord SKELMERSDALE

My Lords, I am sorry: I misunderstood what the noble Lord was saying, and I apologise. The quid pro quo for taking advantage of the bulk mailing rebate scheme is that the sender has to give the Post Office the items pre-sorted into postal towns and counties. This is so much quicker and easier with the postcode, which also makes it very much easier to find a particular name and address. As the noble Lord, Lord Orr-Ewing, said, with the advent of the micro-chip computer, now definitely economic even for a mini-business, in the Government's terminology and certainly in my own—I would not deign to call myself even a small business—the postcode becomes even more important. Although one can, quite easily, assess a name and address from a microcomputer, it is a very slow and laborious process and the use of the postcode speeds it up quite dramatically. I know, because I am busily having a machine programmed at this moment.

Last, but not least, it is fashionable in certain quarters to knock the Post Office. By "knocking the Post Office", I do not mean the kind of constructive criticisms that we have had in this debate this afternoon. I regard them as being useful, and I hope we shall be told by my noble friend on the Front Bench that some of these ideas have already been considered by the Post Office Board and that others certainly will be. However, looking around this Chamber, and indeed around the streets of London as I came from Paddington this morning, I wonder how many noble Lords and members of the public, like me, have blamed the Post Office, because we have not replied to a letter quite quickly enough, or indeed have not initiated one. It is an easy thing to do and "they", the amorphous lump of the Post Office, take the blame. But it is not on.

Can you, my Lords, yourselves, imagine running a service industry, delivering over 30 million letters and half a million parcels a day to more than 21 million addresses, often in very inaccessible parts of the country? It is the town deliveries that subsidise the out-of-the-way destinations, and it is the easily accessible addresses that are, at the moment, being creamed off for parcels by British Rail and private couriers.

To allow the Post Office's monopoly of letters and postal packets to be broken would be a disservice to everyone, as well as being the end of a fairly cheap method of distributing mail. All that would happen would be cheap urban mail and very expensive Post Office-controlled mail for the country districts. In a word, almost, I say, "Don't knock the Post Office". Leave it well alone with, as I say, a few pertinent suggestions, such as those made by my noble friend Lord Campbell of Croy this afternoon.

But by all means hive off the telephone part. Many other speakers have spoken about this and I do not intend to add to what has been said except just to say at the very end that, if I remember my A. A. Milne correctly, Wol the Owl had a notice outside his door saying, "Please knock if an answer is not required." Many of us in this Chamber this afternoon are quite definitely pulling at the bell-rope.

5.53 p.m.

Lord PONSONBY of SHULBREDE

My Lords, may I join with other noble Lords in thanking the noble Lord, Lord Campbell of Croy, for initiating this debate this afternoon on the standard of service provided by the Post Office? One always has a fear, when we debate a subject such as this, that the Post Office will be treated as a whipping boy and that people from all quarters will come to attack it and tell of personal experiences of the Post Office being, as it turned out this afternoon, either too efficient or not efficient enough.

But, in fact, the Post Office has had a considerable number of supporters in the debate today and, as the noble Lord, Lord Skelmersdale, has just said, we should not regard the Post Office as a whipping boy. I am sure that what we should do is to try to judge the achievements, the costs and the reliability of the Post Office by such international standards as we know of, and also by such experiences as we may have.

When the noble Lord, Lord Campbell of Croy, initiated the debate, he first spoke of the letters service which he called erratic and not good enough. He dealt with three areas—the general unreliability, the high cost, and the parts of the country where the service is particularly had. On the question of unreliability, it is certainly so that the targets of the Post Office for deliveries of 93 per cent. of first-class letters on Day B, which is the day after posting, and 96 per cent. of second-class letters on Day D, which is the fourth day after posting, have not been achieved. In fact, there has been a deterioration between 1975–76 and 1979–80, and the Post Office is certainly concerned that the percentages for those services have decreased.

The latest figures which I have are for the month of February 1980. They show that first-class letters improved, for the Tuesday to Saturday collections, from 83.1 per cent. delivered on Day B in the previous year to 86.8 per cent. So there is some slight improvement there. For second-class letters, for the Tuesday to Saturday collections, the figure was up from 81.9 per cent. to 89.4 per cent. I find these figures slightly difficult to understand or to relate, and perhaps the noble Viscount, Lord Trenchard, can explain. There are two sets of figures, the figures for collections from Tuesday to Saturday, and those for the full week collections, which always tend to be slightly worse than the former.

On the question of high cost, the noble Lord, Lord Campbell of Croy, made the point that people would baulk at putting a 20p stamp on their letters in two to three years' time. If we accept—and I am sure we do not accept—that inflation will go on increasing at 20 per cent. a year, then in 3z years' time that is exactly what the cost of posting a first-class letter will be. Therefore, if we are to ensure that that seemingly high cost for posting a first-class letter is not to come about, then we must ensure that the rate of inflation is brought down to a more reasonable figure, which will make the noble Lord's prediction one which does not come about.

The noble Lord, Lord Alport, made a very realistic speech, pointing to the high cost of postal services and to the delays elsewhere. Bearing in mind that situation—the Italian situation and the American situation—to which he referred, the delays which we have in this country are very small indeed.

Lord CAMPBELL of CROY

My Lords, will the noble Lord very kindly give way? He has referred to my speech and it is better if I make the point now rather than later. My reference to 20p was, I hope, not a prediction. I was making it in connection with the suggestion I was making for reducing the cost of the service. It was certainly not a prediction and I very much hope that it will not come about.

Lord PONSONBY of SHULBREDE

My Lords, I am sure we all hope that it will not come about. It will certainly depend on the rate of inflation more than anything else. I should now like to come to the third aspect with which the noble Lord, Lord Campbell, dealt, and which I do not think he said very much about—the question of bad areas. Here, in particular, we think about the position in central London where there has been continual criticism of the postal services. But the criticism is not only of the postal services in London. There have been criticisms of London Transport's services and of the availability of service staff in central London.

A problem which has much concerned local government in London for a very long time is to ensure that there are places available for people to live in the central areas, places from which they can get to their work easily before public transport commences. This is a problem which the Post Office has and which London Transport has. People need to be at work before transport services are available. Of course, in the hotel and restaurant field there is the same problem of people needing to go home after the public transport services have ceased in the evening. This is certainly one of the reasons why the Post Office is understaffed in central London.

There is also the fact that the job of a postman is, perhaps, not as attractive as it was in the past. Before World War the Post Office certainly had no difficulty in recruiting and retaining good quality staff. It is also true that at that time the conditions of service of a postman were considerably less attractive than they are today, but of course the Post Office—as I have said—had no difficulty in filling staff vacancies. One could say that the general employment conditions of the time made this so.

One can also say that a postman and a London Transport worker, for example, at that time were exceptions in the general rule of pensions and other facilities provided for employees, whereas today virtually all employees of all major companies have those facilities available as a part of their employment. The particular attraction of working for the Post Office and having these specially good conditions of service does not exist now as it did in the past; that additional attraction is not there. Therefore, of course, the question of pay becomes ever more important in attracting people to work for the Post Office.

Indeed, I am told that there is some evidence to suggest that, in order to keep staff at times of uncompetitive pay, managers, have allowed unorthodox methods of overtime to develop. Overtime has been paid for which has not been fully worked. No doubt these managers felt that they had no alternative but to do this, since it was the only way in which the earnings of their staff could be kept high in order to hold enough staff to provide an adequate service. This is undoubtedly a potent factor in causing some of the problems which the Post Office has felt in Central London.

The noble Baroness, Lady Elliot of Harwood, spoke very movingly about the Post Office services and hoped that the Post Office unions would co-operate in furthering improvements within the service. Certainly I very much support what she said about the retention of local services.

A service which was not mentioned but which sometimes comes under attack is the telegram service. Periodically there have been attacks that it was quite uneconomic and that it was therefore a service that should be dispensed with. I would resist that proposal very strongly as I feel that the telegram service provides a means of communication for which there can be no substitute for those without a telephone, and that it is a terribly important service. It is curious to note what has happened with the progress of time, because the telegram service was one of the most used services of the Post Office during the latter part of the last century.

Nor would I be happy with the suggestion that Lord Campbell of Croy made, that deliveries should no longer be made to every individual address. Other noble Lords have commented on that and on the American situation where people may have to walk a long way to collect questionable mail. I mean questionable in the sense that they do not know in advance whether there will be any mail for them to collect.

Lord Raglan and Lord Skelmersdale had a small contretemps about the question of post codes. I have always considered myself fortunate here in that I have a post code which is SW1 PIER, which I find easy to remember even though the word "Pier" is spelled P-I-E-R!

May I now go to the question of the telecommunications field'? We must also look at the standard of service there. The particular items one wants to look at are, first, the number of faults which develop in the service, which is a measure of the reliability of the service; secondly, the question of how speedily those faults can be cleared; and, thirdly, the question of the waiting list for people who wish to have a telephone installed. On the question of faults and the speed of clearance, this has shown a considerable improvement in the percentage of calls which failed due to the Post Office from 1974 onwards and reached a peak of perfection, if that is the right word, in 1977–78, showing a slight increase in 1978–79, but still a very low standard of failures due to the Post Office.

On the question of the faults cleared by the Post Office the next day, this shows a gradual decrease in the percentage not cleared by the next day. The latest figures I have show that in the year 1978–1979 about half the faults were cleared by the next day, and the figure is still increasing.

On the question of the waiting list, Lord Campbell of Croy referred to the fact that the waiting list had increased from 200,000 to 265,000 over the past year. I understand that this was caused largely by a heavier than expected demand, with the effect that there was a shortage in supplies arriving. The manufacturers were not able to produce more supplies than they had anticipated they would be asked for. Also, there were problems with cables and exchange equipment. However, I also understand that there is an intention on the part of the Post Office and the Post Office Engineering Union—the union concerned in this side of the work of the Post Office—to aim in the current year for a substantial reduction to 130,000; that is, if this intention of the Post Office and the POEU is realised, the waiting list will be reduced to 130,000, which is about half its present amount. Perhaps that is not an excuse for what has happened in the past but it is a sign that there will be improvement there.

Lord Orr-Ewing commented on the liberalisation of the Post Office manufacturing policy, so that people would be allowed to install foreign handsets in their homes. One of the problems here has always been that if you have a handset which has not been entirely approved it is difficult to know whose responsibility it is to repair it when it goes wrong. The Post Office will not wish to repair a handset which has been manufactured outside their normal code of operation. This is an area which can cause continual problems.

I apologise to the noble Lord, Lord Orr-Ewing, for being out of the Chamber during part of his speech. I gather that he raised the question of the decreasing capital expenditure of the Post Office. I mention that point because I understand that the Post Office have very rigidly applied to them the Government's cash limits policy, with the effect that they are unable to invest as much as they would like to invest. In some ways they should be treated very much as an ordinary competitive industry. They should not be bound in that particular way if they themselves can generate internally the resources for this additional financing. One would hope to see them being able to act in this way.

There were attacks from different parts of the Chamber on that poor bird Buzby, with the noble Lord, Lord Campbell of Croy, assisted by the noble Baroness, Lady Trumpington, aiming to strangle him. I have always felt that he is rather a pleasant character—in some ways perhaps more pleasant than Mr. Cube. I am afraid that I shall not be assisting them in that strangulation policy.

Finally, I should like to say something about the split of the Post Office into the postal side and the telecommunications side. This was strongly argued in the Carter Report, which concluded: The case is reinforced by the general impression from the evidence given to us that the present combined management has led to over-centralisation, poor delegation and slow decision-making. The overloading of the present single board has, in our view, inhibited sound strategic thinking. The Post Office has not been an effective policy-making body producing a co-ordinated strategy for the whole range of communications other than broadcasting". There was no argument over those conclusions by the Carter Committee. However, the Government must look very closely at what arrangements they suggest for splitting the corporation and also at what new structure one will have.

A very interesting suggestion was made by the noble Lord, Lord Alport, that one might have a Minister of State with responsibility for the Post Office. It may well be that a solution to this problem could be to retain the unification, under the guidance of a Minister at the Department of Industry who would have within his area of responsibility the two separate corporations. I thought that this was a very useful suggestion which the Government should look at very carefully. I am certain that whatever arrangements are come to with regard to splitting the Post Office, they must be done as painlessly as possible and in a way which does not unduly ruffle the feathers of all those involved. As noble Lords will know, there is a considerable divergence of opinion about this within the unions involved in the Post Office industry.

I hope that some of the remarks which I and other noble Lords have made will be useful to the Government in considering what should be done for the best for the future of the Post Office.

6.14 p.m.

The MINISTER of STATE, DEPARTMENT of INDUSTRY (Viscount Trenchard)

My Lords, the Government are in debt to my noble friend Lord Campbell of Croy for timing the debate to take place now and for drawing from your Lordships' House, as debates of this kind usually do, some very interesting expert opinions over a wide area, some general and some very specific, like Lady Trumpington's expert knowledge in relation to air mail. Therefore, may I thank my noble friend and assure him, and others who have taken part in the debate, that Hansard will be scrutinised, whether in the photographic form—where I discovered to my glee that other people also have to alter what they have said—or in the printed form, if the dispute is over by then.

This whole subject is of enormous importance, and I have been trying to think what a Government spokesman should put first. What I think I should put first is that we echo the sentiment expressed by many people that there are in the Post Office a lot of people who work and try to serve the public in a very dedicated way. With that as background, I think that one should note that in this House today, as elsewhere in the past and as in the Carter Report, there is unanimity on the split of the Post Office, although there are points about the method, such as those made just now by the noble Lord, Lord Ponsonby of Shulbrede.

We should be a little apprehensive about the idea of a Minister providing a major co-ordinating role between two corporations. I am sure that the noble Lord did not mean that. Our philosophy is that Ministers should not, on the whole, run things, and I am sure that the noble Lord would not suggest that that should happen. We will take note of his views, and those of other noble Lords who have spoken in this debate, as to structure, but as to the split into two purposeful management organisations we have no doubt that it should be done. Nor did Sir William Barlow have any doubts about that. He supported us, and I think the noble Lord, Lord Winstanley, will confirm that Sir William Barlow's board also supported this idea throughout.

At this point I should like to echo the remarks of the noble Lord, Lord Winstanley, and also those of my right honourable friend the Secretary of State for Industry. We are sorry that taking on the telecommunications side after the split is something which Sir William Barlow prefers not to do, and that he prefers to return to private industry. I would ask noble Lords, and in particular my noble friend Lord Alport, to look at the 16th April Hansard report of the other place and see what my right honourable friend the Secretary of State said in relation to Sir William Barlow's resignation. I should also like to draw his attention to the fact that Sir William Barlow has said that there have been no major disagreements on matters of policy between him and the Government.

Lord ALPORT

My Lords, if I may interrupt my noble friend for one moment, I do not think I alleged that this was the case. I said that I understood that the reason for Sir William Barlow's decision not to continue in the service of telecommunications was because of the exposure which he, as a private citizen and chairman, had to the political pressures, which are perhaps inevitable, on a great public corporation of this sort. What I suggested, therefore, was that to relieve the future chairmen of the organisations some of that pressure should be taken by the Government, through a Minister responsible for it—which I think is the right thing to do in the circumstances.

Viscount TRENCHARD

My Lords, I am grateful to my noble friend for making his views clear as to the reason for Sir William's resignation, which we regret. For the sake of clarity of the Government position I can confirm that while all nationalised industries would perhaps like it if there were more capital available for them to do everything they want to do, we had a very happy co-operation between Sir William and his board and this Administration and we regret that it is coming to an end.

Before turning to the letter-post I wish to make one general remark, because both in the case of the letter-post and in the case of telecommunications we are, as noble Lords have said, looking at change. I would say that one of the problems which is before us all the time, as it always has been before anyone considering organisational change, is how big are the changes that one wishes to consider. Small changes can be decided fairly quickly; bigger and perhaps more radical changes take more time to look at. Therefore, while various noble Lords have asked me whether the Government will come to decisions in both these areas in the near future, I can certainly say, "Yes, in the near future", because we have been considering the position now for some time, but I will not commit myself to anything in terms of dates, except to say that we are certainly not thinking beyond months and we are speeding things as much as we can.

In relation to the post, the position last summer was really very serious. It was serious to a point where I think my right honourable friend was fully justified in immediately allowing consideration and recommendation on the breaking of the postal monopoly. Although I know that my noble friend Lord Alport, obviously with great knowledge, has spoken strongly about the fact that the postal service is, and always has been, a national service, I do not believe that that in itself is a sufficient reason, nor do I believe it is dogmatic to look at the question of the degree to which the postal monopoly over the whole field should remain exactly as it is. That, indeed, is what we are doing, and will continue to do.

In relation to the figures for delivery of first-class and second-class mail I do not think the House will want a lot of detailed figures, but the first-class mail—and these figures are on a Tuesday to Saturday basis—last summer dropped to 77.4 per cent. in June, and it was against that background that we felt that real and sweeping investigation was necessary. The same trend applies to the second-class mail. Since then there has been an improvement. The Christmas peak produced a dip against the conditions mentioned by noble Lords in this debate and then we were on an improvement trend again.

I do not wish to steal the thunder of the Post Office for the March figures, but in order to give them what I think is called in advertising terms a "teaser campaign", I can say that they are several percentage points better than the February figures quoted by the noble Lord, Lord Ponsonby of Shulbrede. So that there is an improvement, thank goodness! I must confess that sometimes I wonder, although the sampling is done on the most professional basis possible, just what this kind of survey really means, and at times I wonder how it is that so often I seem to fall into the odd 10 per cent. which lies in the nonstandard delivery part of those figures.

The Government have noted with pleasure for the future the recent acceptance by the membership of the Union of Post Office Workers of a pay offer containing proposals to allow practices conducive to more efficient working to be introduced. That is all part of a two-year plan, produced under Sir William Barlow's chairmanship, to try to work on the many problems that have been raised by various speakers today. My noble friend Lady Elliot of Harwood was right in both apparently opposite directions when she told of the two reports, the one speaking of the shortage of staff and the other of the fact that we were over-manned. Both are true and both, of course, can be true and the manning levels themselves can be affected by the wider-ranging changes which I am sure that my late civil service colleague, Ron Dearing, who goes to take over the Post Office (and I am quite sure that he will make a great success of it) will clearly have to look at in the arguments for maintaining local services in full on the one hand and new ways of making economies on the other. I am sure that the social points will not be missed by him. Both these rival criticisms can clearly be true. With the manning standards and methods used at the present time there are in many areas shortages of staff, particularly in some parts of the country. But this does not mean that there is not room for considerable productivity improvements, both using existing methods and by the introduction of new methods.

In introducing this Motion, my noble friend Lord Campbell of Croy spoke of the escalating costs for a poor service. This is indeed a worry and the prices which are charged are not those which the Post Office would have liked to have used for pricing their services but with the current efficiency levels and with the overall national need to meet cash limits, whether we argue about particular ones or not, these increases were inevitable.

The volume of mail has in fact increased in 1978–79 and the degree to which the volume of mail will prove to be price-elastic is something which only the future will show. The optical scanning methods, which my noble friend mentioned, depend upon postal codes. I am not sure whether the noble Lord, Lord Raglan, is right as to the reason why Post Office codes are not used, and he must give advice to the Post Office on his much better system, which is far beyond my skills to design; but I have a feeling that the failure to use postal codes is something to do with the British character and British independence, as well as the problems of the codes, and I hope that Mr. Dearing will somehow be able to coax the British public into using the codes in order to introduce the systems.

Lord RAGLAN

My Lords, may I make a comment here? I suppose no research has been done as to why people do not use the codes. The London codes are very widely known, and so far as I know everybody uses them. So there must be something which is very different about the way the London codes are put together and the ordinary postal code is put together.

Viscount TRENCHARD

My Lords, I am sure the Post Office—and it is more a matter for them than the Government—will take note of any advice on any better systems of this kind that might be possible. In this context, let me say that I am advised that the suggestion of my noble friend Lord Fortescue that a meter should be installed in the house is rather difficult when the charge depends upon distance as well as time, and also when there are different rates for different times of the day or week. This really does require a slightly complicated meter.

If I can pass to the telecommunications side at this point, let me say that I think in general under Sir William Barlow's chairmanship the Post Office has pioneered some very good new equipment, some of which is famous across the world. Had I time I would refer to a number of different items, but some have been mentioned in the debate already. The problem has been the application of the new equipment and getting it in in time, from a situation where we were perhaps behind at one stage. I think one of the greatest things Sir William has done is to improve the technical competence and performance of the Post Office in the development area on the telecommunications side.

With regard to the delay of up to six months in some cases to get the telephone installed. Yes, it is true that a little over a quarter of a million are on the waiting list for telephones at the present moment—260,000 in fact; and it is true that this is more than the figure for the same time last year, March 1979, which was 196,000. I do not have the internal target that the noble Lord, Lord Ponsonby, mentioned for 1980, but I do know that it is the Post Office's determined intention to turn the path round and improve it substantially. More engineers have been engaged, more last year, I think, than ever before; efficiency consultants have been used; temporary equipment is being used; many other methods are being used to try to improve the position. It is also regrettably true, as my noble friend Lord Orr-Ewing said, that on some other equipment, notably the PABX, delays are considerably longer.

Let me at this moment turn to the point of capital requirements, and let me say merely that we are still looking at the question of whether, if it is clearly the case that we have now more new technical applications which are proven than the cash limits for the future would appear to cover—there must be cash limits, and for the 80s they are not small ones—we are prepared to scratch our heads about how, without breaking Government cash limits, money could be found to speed up development. Of course, one of the main areas here lies in the breaking of the monopoly; we agree with all other speakers and we agree with the quotation which my noble friend Lord Morris made from the Carter Report that the existing boundaries to the telecommunications monopoly do need real examination. We have been for some time now taking advice from all concerned, and we shall announce the results of this certainly in months. We shall not exclude the possibility of phasing in liberalisation rather than one big package; this is one of the alternatives we are looking at.

The problems of compatibility have been described, and the problem of how a necessary authority will approve standards, will ensure compatibility, will draw up any terms for licensing, is well taken on board and is being examined from every angle. In relation to costs and prices, telephone charges did not in fact increase from October 1975 until the latest increases were introduced, so that though those increases are steep one does have to take account of the four years of standstill in charges. One had hoped, and I know Sir William Barlow had hoped, that that standstill could have been continued for a longer time, but wage settlements in relation to productivity forced the introduction of the higher charges at the time that they were introduced.

With regard to Buzby, I will not enter into the debate, except to say that I understand that Buzby makes a profit and gets more new business. Furthermore, one of its main purposes is shifting off-peak loads and drawing consumers' attention to the fact that they can save money by phoning on certain days at certain times. The noble Lord, Lord Orr-Ewing, raised a great number of very interesting points. I do not think I shall be able to deal with them all today. The international comparisons are being examined by the joint committee that he spoke of. They are not easy to draw conclusions from. But there is no complacency and they will be dealt with. The Users Association document and its recommendations have been examined very closely, and my honourable friend Mr. Butler has been in communication with the association on all their recommendations.

In relation to the capital situation and to the decline of capital—I think perhaps this is the last major point that I should try to deal with—I have looked rather quickly at the figures raised by my noble friend Lord Orr-Ewing. Of course, there is an uneven path of capital investment; there was very high capital investment in the period 1973–75 at a time of very low profit and at a time when perhaps a great deal of catching-up was necessary. The type of equipment currently required, and the size of the demand, are different, and the Post Office have made mistakes in estimating demand—I think everybody always does. The figures for the future, for the 1980s, in the Government's expenditure plans show clearly that we rise to another pretty high peak.

Perhaps I may best summarise it by saying that the expected expenditure and constant prices in the four years up to 1983–84 will be 20 per cent. higher in constant prices than the total in the four years since 1976–77. I will give extra information to my noble friend, but I believe that very large capital expenditure has now been allowed for. The degree of self-financing of capital expenditure depends upon the size of the profit with which it can be self-financed as well as on the capital programme.

I will draw the attention of my colleagues in the Home Office, who have the overall responsibility for the regulation of the radio spectrum, to the points made by my noble friend Lord Morris. I shall make sure that those points are fully taken on board by them. They are fully seized of the importance of the radio spectrum as a very valuable national resource. Once again I should like to thank my noble friend Lord Campbell of Croy for introducing this debate at this time. I apologise for this rather inadequate and disjointed winding-up, and I promise noble Lords that the debate will be drawn to the attention of all of my right honourable friends concerned.

6.43 p.m.

Lord CAMPBELL of CROY

My Lords, I should like to thank all of the noble Lords who have contributed to the debate today. As a result, a number of different topics of concern to the public have been raised—for example, postal codes, air mail, telecommunications equipment and business users, to take but a few that I was not able to touch on.

I should like to comment first on a point raised by my noble friend Lord Alport, because there may be a possibility of a misunderstanding here. He referred to certain anomalies to which I had pointed—for example, that first-class mail within London, travelling only two or three miles, could take up to five or six days; and he drew my attention, quite rightly, to the United States of America where there are post boxes and individuals have to collect their own mail. It was because I lived for three years in the United States some years ago that I made the proposal that we might move to that situation which all other comparable industrial countries have already adopted.

It was suggested that collecting one's mail in that way would be objected to. I suppose that might be the first reaction of the average customer, but when I said that for two of those years when I was collecting my own mail locally I was living on the outskirts of New York and not in the sticks, as my noble friend was suggesting—he does not seem to be here at the moment—he will see that it was because I and my American neighbours preferred to collect from post boxes locally rather than pay the disproportionate cost of high-wage postemen doing this extra, but not essential, leg work, that I put this proposal forward in my speech. It was also touched on by the noble Lord, Lord Ponsonby. I apologise for making the point briefly in my speech, but I was trying to cover a number of subjects reasonably briefly and to be very constructive in putting forward a proposal that I believed would be significant for postal costs.

Because of the interest shown in that part of my speech, I must draw attention to the fact that it was Sir William Barlow himself who said that the Post Office would like this legislative requirement to be altered on the lines I have suggested. That is why I hope that my noble friend will read what I have said, because he was quite rightly pointing out how much Sir William had contributed during his term, and I think he was quoting him. Therefore I think it is important to note that on 30th January, in evidence to the Select Committee to which I referred, published and dated 5th March, at page 13, column 2, when he was asked whether the Post Office wished to have the requirement altered that post be delivered to each individual address such as flats in a block, he said that he would. Those who are interested—and it is clear that many who have taken part in this debate are interested in this point—could well look up the exchanges under the reference that I have mentioned. That is why I have given it, because there is a great deal more there that indicates the Post Office view. It is to encourage changes that require legislation to enable it to reduce costs in this area. It was largely because of the Post Office view expressed by Sir William Barlow and because of successful practice abroad that I put forward this proposal. I suggest that it should be examined.

My Lords, if costs can be reduced then the cost of stamps need not reflect inflation. I hope that inflation will be curbed and reduced drastically in the next few years, but whatever happens to inflation, if costs can be cut in this way then the cost of stamps need not follow the same path

I am particularly grateful to my noble friend Lord Trenchard for the information he gave in his speech and for replying to the main points which the speakers had raised. I welcome the improvements about which he was able to tell us. The Government, of course, are not answerable for the day-to-day activities of the Post Office, and I would not expect my noble friend to answer any points of that kind. But long-term strategy and reorganisation are matters for the Post Office. Parliament is much concerned, not only because of the interests of the public that are involved but because of the changes that may be necessary in existing legislation. It is therefore heartening that my noble friend and his ministerial colleagues are clearly putting the sound help of these services to the public very high in their priorities. My Lords, I beg leave to withdraw the Motion.

Motion for Papers, by leave, withdrawn.