HL Deb 08 July 1999 vol 603 cc1025-37

3.34 p.m.

The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Sainsbury of Turville)

My Lords, with the leave of the House, I shall now repeat a Statement on the Post Office which has been made in another place by my right honourable friend the Secretary of State for Trade and Industry. The Statement is as follows:

"I wish to make a Statement on the Post Office White Paper which the Government published today. This White Paper sets the agenda for the Post Office to offer a world-class service for the 21st century.

"Today's announcement is good news for the Post Office and all those whose livelihoods depend on it, because it can now build for the future with real confidence. It is good news for the Post Office's millions of customers, who will benefit from improved services from a new, modernised Post Office and from greater competition for postal services.

"It brings an end to the uncertainty that has dogged the Post Office over the last decade: uncertainty over its role and place in society; uncertainty over its long-term viability and ownership; uncertainty over the universal service obligation; and uncertainty over the Post Office network. Today we provide certainty and a new sense of direction and purpose—based on modernisation and reform.

"Throughout the world, postal markets are changing at an increasingly rapid rate. Globalisation of postal services, the growth of faxes and e-mail, more demanding customers and greater liberalisation of markets are driving change as never before. It is not a question of whether markets will become more competitive, but how far and how fast. The Post Office already faces fierce competition, not only from private sector couriers, but also from other post offices throughout Europe and from the Internet. I know that the Post Office management see change and greater competition as an opportunity and not as a threat—an opportunity to enter new markets and to overhaul the Post Office's business processes; an opportunity for new ventures and new alliances; an opportunity to prove that the Post Office can compete against the best in the world and do so successfully.

"But in order to compete effectively and fulfil its potential, the Post Office needs greater flexibility. If it is not given greater freedom to expand into wider and international markets it will find itself confined to a diminishing sector of the postal market, saddled with falling value and shrinking profits.

"That is why in this White Paper the Government are mapping out the most radical set of reforms since the modern Post Office was created in 1969—reforms which will ensure that the Post Office can provide the services we need in the 21st century.

"The White Paper proposes that the Post Office be subject to a combination of effective market disciplines coupled with regulation and be allowed new commercial freedoms. Operating at arm's length from Government, it will have the freedom to grow and the means to succeed.

"Existing mail services will be maintained and indeed strengthened as, for the first time, the universal service obligation, including the requirement to deliver to all addresses, will be laid down in law. That will guarantee the uniform tariff for these services. The cost of a stamp will be the same, regardless of the distance of delivery. And the free service for visually impaired people will continue.

"Stronger competition and better regulation will work together to keep prices down and improve service quality and consumer choice. As part of the balanced package that we are bringing forward, greater commercial freedom must be matched with some liberalisation.

"The White Paper therefore proposes a reduction in the monopoly from the present £1 to 50p or 150 grammes with effect from 1st April 2000. A new independent postal services regulator will promote consumer interests, regulate prices and ensure that the Post Office provides a high level of service to all households and businesses. And consumers' views will be championed by a greatly strengthened Post Office Users National Council which will have the power to refer poor performance by the Post Office to the Regulator and will be able to recommend the levels of fine to be imposed for bad service.

"The Post Office Counters network, which plays such a valuable role in local communities, particularly for the less mobile, will be strengthened by our decision to put the Horizon project back on track. We shall equip all 19,000 post offices with a modern, on-line computer system.

"It will enable the Post Office to modernise and improve the service it gives to existing clients and customers, and to win the new business on which the future success of the Post Office network will depend.

"For the first time the Government will lay down minimum criteria in order to ensure that everyone in the UK has reasonable access to post office counter services particularly in rural parts of the country and areas of social deprivation. The new regulator and the users' council will monitor the network against these criteria.

"We have agreed arrangements with the Post Office for maintaining a network of Crown offices which will handle at least 15 per cent of the total counters' business. Where appropriate, new Crown offices may be opened.

"The Government will set out clear objectives for the Post Office, but they will not be involved in day-to-day business operations. The Post Office board will be responsible for running the Post Office, based on a rolling, five-year strategic plan, agreed with the Government.

"Clear duties, real powers and the necessary resources to promote the consumers' interests will be given to the independent regulator and the users' council. Annual reports will be published by the Government, by the Post Office, by the regulator and by the users' council on their roles and their performance during the year.

"We will implement as much of this package as possible through administrative action and secondary legislation. However, primary legislation will be needed as soon as parliamentary time permits to complete the full package of reforms.

"Primary legislation will be necessary to transform the Post Office into a public limited company which will both underline the new commercial freedoms and help to establish clearly the separate functions of ownership and management by subjecting the Post Office to the full range of company law. In particular, the directors will owe their duty to the company—not directly to the Government.

"There have been suggestions from some quarters that this is part of a plan to privatise the Post Office by stealth. There are no such plans. As we said in our manifesto, we intend to provide commercial freedom while retaining the Post Office in public ownership. I can therefore inform the House that the Act of Parliament to create the Post Office as a plc will make it clear that we would not seek to dispose of Post Office shares without further primary legislation.

"Of course, we cannot ignore the possibility that the Post Office might wish to enter into a joint venture or strategic alliance with another company and might wish to cement this with a limited sale or exchange of equity. In such cases it would not always be sensible or practicable to seek parliamentary approval through a separate Act of Parliament. However I can assure the House that any such proposal would be debated and voted on in both Houses.

"To ensure that the Post Office can compete in the fast moving domestic and international postal market, we will give the Post Office the greater commercial freedom it has long desired. This will help the Post Office to be more competitive and more responsive to market developments and evolving customer demands.

"The Government's financial demands on the Post Office will be reduced to match commercial dividend rates. From April next year, it will be cut to 40 per cent of post-tax profits—more than half the rate at which profits have been removed from the business in recent years. This will be worth an estimated £150 million a year going directly to the Post Office.

"We will also allow the Post Office to borrow at commercial rates for growth investments up to £75 million a year without approval from the Government. This will give the Post Office greater freedom to enter into acquisitions, joint ventures, alliances and partnerships.

"But the Government recognise that the Post Office has been starved of resources as a result of the approach of the previous government. The Post Office cannot wait until April next year for the additional resources necessary to ensure that it can compete in the modern postal market. We therefore intend to take action immediately.

"I am pleased to inform the House that in this financial year we shall reduce the Government's financial demand on the Post Office to 50 per cent of post-tax profits and will allow borrowing of up to £75 million. This will provide an immediate cash boost to the Post Office of £175 million.

"Taken together, our proposals for greater commercial freedom will bring over £600 million into the Post Office over the next three years.

"I am confident that this White Paper maps out a future for the Post Office that will allow it to compete and win. We have a clear vision of a British Post Office which is world class and which aims to be among the most successful in the world.

"This White Paper gives the Post Office management the commercial framework they need to turn this vision into reality. It is now up to them, working in partnership with the workforce, to respond to the exciting challenges ahead.

"This White Paper will put right the neglect of the past and deliver a Post Office which is fit for the 21st century. I commend it to the House."

My Lords, that concludes the Statement.

3.45 p.m.

Baroness Buscombe

My Lords, I thank the Minister for repeating the Statement regarding the long-awaited White Paper on the future of the Post Office. While we welcome the Government's support for improved services, for greater competition, for more postal services and more flexibility for the delivery of those services, we are disappointed that the Government have effectively backtracked from the proposals clearly set forth in a Statement made by Peter Mandelson in another place in December last year.

The reason for the backtrack is, in our view, quite clear. It is because of the continuing, awkward power struggle between New Labour and the trade unions, with the inevitable result of a halfway house—an unsatisfactory and, we now hear, for many who work in the Post Office, an alarming and disturbing compromise. This is not full liberalisation of the Post Office, although I predict that it is an important first step to privatisation—a mere temporary measure.

The Secretary of State seems almost offended in his Statement that this is a route to wholesale privatisation by stealth. However, he cannot be surprised when, in his Statement in another place in December last year, Peter Mandelson stated: I should make it clear that we certainly do not rule out the possibility of introducing private shareholding into the Post Office—for example, through the sale of a minority stake in it—at a later stage".—[Official Report, Commons, 7/12/98; col. 21.] Further in the Statement he said: [But] at present wholesale privatisation— favoured by the Conservative Opposition— would not be a realistic option". But the White Paper goes far beyond measures proposed by the previous government which looked to freeing up 'the Royal Mail alone—a measure which was strongly resisted by this Government when in opposition. Now they are in government, I suggest that we shall privatise every part of the Post Office.

I wish to place particular emphasis on the future for post offices in rural areas. We are especially concerned following the Secretary of State's clear statement in another place earlier today in response to a question in relation to the Post Office network that, I cannot guarantee that every network facility that exists today will remain for the future". In that regard I am concerned with the minimum criteria which the White Paper mentions wherein the Government will seek to develop criteria for the Post Office network to ensure that the network is reasonably accessible to all. We welcome the Government's intention to equip post offices with the latest technology, providing access for everyone to an increasing range of services. But we are concerned about the true meaning of "reasonably accessible." We hope that access will not be dependent on the recipient also being equipped with the latest technology, for example e-mail, as opposed to a Post Office counter within a reasonable distance of one's home.

While we greatly appreciate and welcome the strengthened Post Office Users National Council, we have other concerns with regard to the ability of the council to respond to individuals and their wish and will to have redress against poor performance by the Post Office.

This Statement raises many questions for the future of the Post Office. I put the following questions to the Minister. How does the noble Lord expect the Post Office to compete effectively in world markets without the full commercial freedom that the privatised Dutch and German post offices enjoy? To what borrowing restrictions will the Post Office be subject? Will taxpayers' money be at risk? Further, what guarantees can the Minister give that rural post offices will not close? Does he agree with the fears of the National Federation of Sub-Postmasters that one-third of post offices are under threat as a result of the Government's abandonment of the benefit payment project?

3.50 p.m.

Lord Razzall

My Lords, I echo the words of the noble Baroness on the Conservative Front Bench in welcoming this extremely significant Statement on the future of the Post Office. The noble Baroness was quite right to focus on two main issues that emerge from the Statement. The first is the absolute determination of everybody on this side of the House to ensure that the key paragraphs on page 3 of the Statement, relating to reasonable access to post office counter services in rural parts of the country and to areas of social deprivation, are carefully monitored. We must ensure that the programme of post office closures, which was started and accelerated to a great extent by the previous government, does not continue under this Government. I am sure that everyone in the House would like an assurance from the Minister that the deterioration in rural services and areas of social deprivation will not be allowed to continue.

The second critical issue on which the noble Baroness touched was privatisation. For those who have studied this matter, clearly there has been a big row. That is not surprising given that the proposed public limited company structure is different from that which we all thought would be adopted for the Post Office. It would be helpful if the Minister could confirm that there is no intention to privatise the Post Office. A clear statement to that effect would go a long way towards diminishing people's fears. In the Statement one sees the phrase "there are no such plans". I suspect that when British Telecom became a plc, as it did before privatisation, the government could legitimately have said that they had no such plans to privatise it. We do not want to know whether there are any plans but we do want an undertaking that that will not happen.

To transfer the whole of the assets of the Post Office—its property, undertaking and employees—will be a massive legal and financial task. First, does the Minister, via his officials, have any idea of the professional costs, which will be borne ultimately by the new plc, involved in performing that transfer? Secondly, has the noble Lord any comment to make on the potential criticism following the Statement in December that, while the Post Office would be given commercial freedom, it would be subject to public sector control with regard to salaries and pay'? Concern was expressed in a number of quarters that if the Post Office wanted to compete on an international basis, but was subject to public sector principles related to pay and salaries structures, the freedom of its board to manage it in the way it thought fit would be impeded.

Thirdly, is it correct that, following the creation of Post Office plc, the company will be subject to all the transparency to which any other UK listed company is subject, in particular the disclosure of prices paid for significant acquisitions which currently are not disclosed? Finally, does the Minister accept that the borrowing limit of £75 million which has been lifted is a relatively small amount of money to free from public sector controls? Does it not need to be kept under review? It may well be that that limit needs to be significantly higher.

3.57 p.m.

Lord Sainsbury of Turville

My Lords, the Opposition must decide whether they are accusing the Government of back-tracking or wholesale privatisation. They cannot have it both ways. I humbly suggest that the reason for this confusion is the same as that which has dogged the Conservative Party for the past 18 years, with the result that it is paralysed in dealing with this issue. Quite simply, this is exactly in line with what Peter Mandelson said in introducing this matter in December. We have created a company that will have commercial freedom. To do that we have adopted the structure of a plc, which we believe to be the best form, but the body will remain in public ownership. We do not rule out the introduction of private equity at some time in the future, but we have no plans to do so. That was exactly what we said on the previous occasion.

As to rural sub-post offices, for the first time clear criteria are being laid down for access to the network. We cannot say that no rural sub-post office will ever close. The fact is that they are private commercial businesses and we cannot guarantee that they will remain open. For the first time we are laying down clear criteria for accessibility which we believe should give people confidence that we take this matter very seriously. The regulator will also have a role in monitoring the network and seeing that those criteria are applied.

The noble Lord, Lord Razzall, asked about the cost of the task of turning the Post Office into a plc. I cannot give any figures, but. I do not believe that the cost will be huge because the basic structure already exists. What will be changed are the financial structures and those related to governance. The assets are already allocated to that body, and we do not believe that that will be a hugely complicated task.

I was asked about the freedom of the new body in terms of salaries and pay policy. We have said that this must be taken into account in public sector policy and have resonance with it. At the same time, we will probably introduce new parameters so that there is greater flexibility. Therefore, salaries and pay will not be controlled in exactly the same way as in the public sector. We believe that that will give the Post Office all the flexibility that it needs to pay the necessary salaries and wages to motivate staff and acquire the people they need to carry out its new tasks. The new body will have the transparency of a plc, and that is the reason for using that structure. That is a standard, agreed format 'which will be clear not only to the workers in the organisation and everyone in this country but elsewhere. Everyone will know the basis of the organisation with which they are dealing.

As far as concerns borrowing, the new body will be able to borrow £75 million each year. If any project is over £75 million, the body will have to obtain government permission for it, but we have made it very clear that we shall look at major projects that are in the strategic plan and that if they meet the criteria that we have set out, in terms of robustness, no undue risk and being commercially sensible, we shall allow them to go ahead. This gives the Post Office the freedom it requires.

4 p.m.

Lord Molyneaux of Killead

My Lords. the Statement seems strangely familiar to those of us who went through this debate about a decade ago, and for that reason one must support the whole project.

Can the Minister clarify one point? He referred to the office of regulator, apparently in singular form. In the office of the regulator will there be subordinates with special knowledge of the four areas of the United Kingdom?

Finally, if a post office, great or small, is listed for closure, at what level will the consultations take place?

Lord Sainsbury of Turville

My Lords, I should have said that the regulator will take the form of a commission, made up of a number of people. I am sure that we shall pay very serious consideration to the points the noble Lord has made with regard to that body, so that different parts of the United Kingdom are reflected within it. We shall, of course, continue and, indeed, increase the consultation process, particularly on areas such as Crown offices, so that local people are fully involved.

Lord Clarke of Hampstead

My Lords, where can I find the reference to a plc in Labour Party's manifesto documents? I have with me today all the consultative documents, the preamble to the manifesto and the manifesto's precursor. I should like to be directed to where the Labour Party said that it would create a plc for the Post Office.

I should have declared an interest. I spent over 50 years of my life directly associated with the Post Office and in latter years have continued that association as a trustee of the Post Office pension funds. I apologise for not having said that immediately. Anyone who has had a long connection with the Post Office, or even a short connection, will welcome the commercial freedom that is heralded in the White Paper. While being happy about that, I think that today is a sad day for the Post Office. I share the view of the noble Lord, Lord Mackay of Ardbrecknish, who said only yesterday in this House: whatever gloss the Minister puts on it, either today or tomorrow in the Statement, is not the creation of a plc with share capital the first step on the route to privatisation?".—[Official Report, 7/7/99; col. 877.] I listened to the Statement in the other place and heard the assurances that were given. I am still unconvinced that there are enough safeguards.

That brings me to a specific question. Having heard the Secretary of State say today that the concept of an independent, publicly owned corporation was fundamentally flawed, I would welcome the comments of my noble friend the Minister on those fundamental flaws, because the matter of commercial freedom and all the other aspects of the White Paper could easily have been dealt with without the creation of a plc. I would love to know the fundamental flaws in the suggestion for an IPOC, which is an independent, publicly owned corporation.

Finally, I should like to ask whether the Post Office pension fund and staff superanuation scheme are unaffected. As the main one has been in surplus for many years, and the Post Office has enjoyed the benefit of a contributions holiday for so long. I should welcome an assurance that both pension funds are unaffected by the White Paper.

Lord Sainsbury of Turville

My Lords, I do not think the question of a plc was covered in the Labour Party manifesto, but things do happen in this world that were not covered in that manifesto. We said in the manifesto what we would do; we did not say that everything we did in government would be covered by it. There are very good reasons why we should use a plc format in this case. Perhaps I may rehearse them before coming on to why I do not think that an independent, publicly owned corporation is the right way.

As I said, the main argument is that we need to have a model that is clearly understood by people both within the organisation and outside. The plc format is clearly understood, is backed by legislation, and everyone understands it.

The problem with the argument for an independent, publicly owned corporation is specifying exactly what that means. It could mean a body that is exactly the same as the body we have today, with the same lack of definition. It could describe exactly the organisation that we are putting in place. We are putting in place a publicly owned corporation which is independent, and to stress the independence we are using the plc format, which makes it very clear that the body has commercial freedom. The argument against an IPOC is simply that it is not at all clear what it is, and if the Post Office is to take, as I hope it will, full advantage of its opportunities and commercial freedom, it must have a structure which everyone understands and which it can use.

As far as I know, the Post Office pension fund is not affected in any way, but I shall write to confirm that that is the case. I am sure that it is.

Lord Crickhowell

My Lords, is not there a fundamental contradiction in what the noble Lord the Minister has said? He has talked a great deal about commercial freedom. He has talked about a company that can compete in world markets. Yet he has also talked about a £75 million borrowing limit, a sum which he would have thought was pretty modest in an earlier incarnation. Does this not suggest that the Government are determined to keep very tight control over the so-called "independent" plc? How will the company operate with commercial freedom in a tough and highly competitive world market if it has to return to the Treasury every time it wants to borrow more than that?

Lord Sainsbury of Turville

My Lords, even in my previous incarnation I thought that £75 million, which is at least the cost of two supermarkets, was a large sum of money. I need to make it very clear that the £75 million is simply the amount that the Post Office can borrow automatically, without obtaining Treasury permission. The fact that the Post Office acquisition of German Parcel for around £300 million took place makes it very clear that this is no paper undertaking, but represents a serious increase in the commercial freedom of the Post Office.

Lord Ezra

My Lords, as someone who has pressed regularly from these Benches for greater commercial freedom for the Post Office, and has expressed grave concern over the large sums extracted by the Treasury from post-tax profits, I am very pleased with the Statement. However, following on from the last question, I should like to probe further about the relations of the Government with the new board; the Government representing the shareholders, the nation. We heard that the Government will agree a five-year, rolling strategic plan. How will the Government call the Post Office to account on this? If opportunities arise for major acquisitions or joint ventures not in the plan, will the Post Office have to go back to the Government? How free will it be to operate in a market which, as the noble Lord the Minister explained to us, is evolving rapidly, globally and technologically, and in which one cannot anticipate in what directions opportunities will arise?

Lord Sainsbury of Turville

My Lords, I totally agree with the noble Lord that this is an absolutely key issue. Clearly, it is important that there is a five-year strategic plan and that the Government, as the major shareholder, are confident about that plan. But the whole reason for doing it in this way is that the Post Office would have the freedom, even if a project were not in the strategic plan, to come forward and ask for the money to be made available for it. We have laid down criteria for this. The main one is that it should be a commercially robust project and pose no undue risk to the company. Clearly, if it is in line with the strategic plan, the decision will come more quickly, but we are not ruling out other proposals which take account of specific opportunities that arise in the market.

Lord Stoddart of Swindon

My Lords, is my noble friend aware that I have been in this and another place long enough to know that if the Statement had been made by a Tory:Minister there would have been hell to pay in the House of Commons and, indeed, here? That would have been perfectly justified because undoubtedly this is the first move towards privatisation, whether under a Labour government or a Tory government. What the Government are doing is opening the door to privatisation. Make no mistake about that.

I ask the Minister three questions. First, he said that this will not mean privatisation, but he also said that it would be possible for a sale or exchange of equity between the Post Office and private firms. Is not that a sort of privatisation, if private firms can invest in the Post Office and the Post Office in private firms?

Secondly, the Minister said that primary legislation will be needed to dispose of the Government's equity. Is it not possible, as in the case of BP, to dispose of that equity through a Finance Bill rather than a special Bill, because they are very different?

Thirdly, what is there to safeguard the Post Office pensioners and contributors from the same problems that the electricity supply pension scheme had, when pensioners' money was used to pay for redundancies made in that industry?

Lord Sainsbury of Turville

My Lords, if I have not made it clear, let me now do so: this is not seen as a step towards privatisation. It will put in place a clear structure for the Post Office. There is no great virtue in debating whether an exchange of equity between two companies is or is not privatisation. I hope that we can all agree that if the Post Office—in a world which is seeing increasing internationalisation of the market—is to have a level playing field on which to compete against other post offices, it must be able to undertake that kind of operation. It is not the same as privatisation, because the equity will still be held on a majority basis by the Government and, therefore, it will be Government-owned.

The essential issue is that the Post Office should be able to take advantage of this opportunity. Primary legislation will be needed to sell the shares because that will be put into the Bill that sets up the plc.

As far as the pension fund is concerned, I need to check, but I assume that the money in the pension fund belongs to the people who put it in and, therefore, cannot be taken out or penalised in any way.

Lord Renton

My Lords, I agree with what my noble friend on the Front Bench said about the need to support rural services. I remind the Minister that in the industries that have been privatised, such as electricity, water and many others, there is always an obligation to provide a public service. To the villages that have post offices, they are not merely a convenience for those of us who happen to have motor cars but a necessity, especially for old age pensioners. If they live some distance from a town, old age pensioners would be at a grave disadvantage if their local post office closed. Will the Minister bear that in mind?

Lord Sainsbury of Turville

My Lords, I take that point very seriously. Rural post offices are enormously important to their communities and the reason for that goes beyond simple commercial criteria. They are the foundation of many villages and their community life. I emphasise again that—for the first time—accessibility criteria will be included in the Bill and the regulators will have a responsibility to monitor their fulfilment. We cannot guarantee that post offices will not close, because they are private businesses and if the owners decide that they cannot continue we cannot necessarily put something in their place. We are well aware of the importance of rural sub-post offices. That is why we are specifying those criteria and will put in place, for the first time, a regulator outside Government who will monitor the network against that criteria.

Lord Monkswell

My Lords, I thank my noble friend for his statement this afternoon. Perhaps I may ask him a couple of quick questions. He referred to the modern Post Office being formed in 1969, but I am sure that the Government will be aware that the history of the Post Office in this country goes back 350 years and it was 180 years ago that the penny black came into existence.

The statement says that the directors of the new Post Office plc will owe their duty to the company. That cannot be right. Surely they will owe their duty to the shareholders of the company, who are the 55 million British citizens in this country. The statement continues by mentioning joint ventures and strategic alliances with other companies. We can understand why those may be necessary in the modern, global market, but will the Minister assure us that any sale or exchange of equity will be limited, not wholesale?

Lord Sainsbury of Turville

My Lords, while it was right to pick on 1969 as the date when the modern Post Office was set up, I agree that it has a long history. When I sat on a commission in the late 70s to review the Post Office, a friend of mine produced a long list of all the commissions that had sat previously to review the Post Office. There is nothing new in the world, and the Post Office certainly has a long history. I would point to 1981 as a significant date, when the Post Office was separated from telecommunications.

In plc law, the duty of the directors is to the company, and through the company to the shareholders. As the Post Office will be a publicly-owned company, the directors' duty will continue to be a duty to the Government and the people of this country. I confirm that any exchange of equity will be limited.

Baroness Oppenheim-Barnes

My Lords, I apologise for not being here right at the beginning of the Minister's statement. I know that the regulator will protect consumer interests, but what will be the position of the new Post Office plc in relation to the fair trading legislation? Currently, the Post Office has wide exemptions as a public undertaking. Will it be subject to all the regulations, rules and provisions of the fair trading legislation?

Lord Sainsbury of Turville

My Lords, I hesitate, especially with my noble friend Lord Borne sitting behind me, to make a statement on that point, but I can say that the regulator will have the powers to adjudicate on issues of fair competition, as well as his regulatory powers. I believe that that is the position for most of the regulators. I will check on that point and let your Lordships know if that is wrong.

Lord Borrie

My Lords, the Minister kindly said in answer to the noble Lord, Lord Molyneaux, that the regulator is not to be a single individual but will be constituted as a commission. Is that a good sign that the Government will introduce a utilities regulation Bill in the near future? That idea comes from Labour, and is contrary to the model the Conservative government used, which constituted regulators as individuals. I hope that the new model will be extended to the other utilities so that they will have a commission or board to share the decision making.

Lord Sainsbury of Turville

My Lords, this is an idea whose time has come and it can be seen to be a sign of the way thinking is moving.