HL Deb 19 July 1982 vol 433 cc620-1

2.48 p.m.

Baroness Trumpington

My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.

The Question was as follows:

To ask Her Majesty's Government how much money British Telecom is spending on circulars sent through the post to customers.

Lord Glenarthur

My Lords, this is a commercial matter for British Telecom. But I understand that their expenditure on circulars sent in the post is in the region of £750,000 a year, and therefore extremely small in relation to the number of telephone subscribers and British Telecom's annual turnover of around £4½ billion.

Baroness Trumpington

My Lords, I thank my noble friend for his reply. Would I be right in thinking that they actually make a profit out of the circulars which they are distributing? If that is so, why is it necessary to put up many charges, including telephone rentals?

Lord Glenarthur

My Lords, it is not strictly true to say that they make a profit from their circulars, but of course the sending out of circulars increases revenue in certain areas. So far as charges are concerned, I think the noble Baroness may feel that they do not relate strictly to the Question. But, so far as I understand it, it is the hope that it will not be necessary for one area of British Telecom to subsidise another. Therefore, the charges in one area might come down while the other goes up.

Lord Airedale

My Lords, do the Government think that it is fair competition for a public utility, like British Telecom or, particularly, an electricity board, which has free postal access to every household in the country, because of course it passes on the postage charge to the customer, to include with the bill a leaflet advertising appliances for sale, when it would cost the private sector of the industry a fortune in postage charges to do direct mail advertising on that scale?

Lord Glenarthur

My Lords, no, I do not see any reason at all why British Telecom should not send out material with telephone bills, if, in their commercial judgment, it is wise to do so. It might help the noble Lord if I say that the material which goes with bills mainly comprises private advertising, the revenue from which more than compensates for the production and marginal distribution costs.