HC Deb 11 November 2003 vol 413 cc62-70WH
Mr. Deputy Speaker (Mr. Edward O'Hara)

In the absence of the Minister, the debate may commence, but there must be a quorum of three, including the initiator of the debate and myself.

4 pm

Tony Lloyd (Manchester, Central)

This takes me back to the days of the Conservative Government when, even though Ministers were present, it was almost pointless them being there. In this case, I have no Minister to talk to, unless perhaps, in the absence of her ministerial colleague, the Under-Secretary of State, Office of the Deputy Prime Minister, my hon. Friend the Member for Pontefract and Castleford (Yvette Cooper) will officiate. I trust that he will come, because although I am happy to make my speech for the record, it would be a shame if I were not able to address my remarks to the right Minister. I imagine that, even as we speak, efforts are being made to raise him.

The debate is about post office closures in central Manchester, a matter that I have wanted to bring to the attention of the House for some time. It is widely accepted that the post office is a vital part of the infrastructure of our fragile inner-city areas. That has been recognised by the Government—every Minister who speaks about post offices makes the case that they are part of that infrastructure, and that there is a social case as well as a business case for them. Indeed, the Government have accepted that inner-city case to the extent that local government wards in the bottom 10 per cent. of the most deprived wards are given extra consideration—the normal rule that post office branches should not close unless there is another post office within a mile has been reduced to half a mile. That is an important addition.

The whole of my constituency is inner city: every ward falls into that bottom 10 per cent., and seven of the eight wards fall into the bottom 1 per cent. I shall illustrate the scale of the problem with reference to one of the wards, Moss Side, where one of the branches to which I shall refer was located. Moss Side is very much at the worst end of the social ladder. Some 70 per cent. of its population have no access to the motor car; and bus use is 2.6 times greater than normal. In the case that I shall discuss, the direct bus services to alternative post offices are bad. Unemployment is 2.8 times the national average, and there are 3.9 times the number of single parents, as well as many elderly people who have great difficulty with mobility and in accessing the normal facilities.

It is in that context that I want to raise the fact that the Post Office has broken its own and the Government's commitment to maintain a proper and adequate framework of sub-post offices. In particular, I shall judge the Post Office against the words of David Mills, the then chief executive, who wrote to me a year ago in October 2002. He stated: We have a commitment to our branches within deprived urban areas, especially those with no other branch within I, mile, but you will appreciate that this commitment is impossible to achieve without the goodwill of landlords. He also stated: We cannot afford to keep failing branches open since Post Office Ltd suffered a loss of £163 million in the last financial year. That is fine, but I assume from that comment about failing branches that if branches are successful they should remain open. I also want to raise the issue of whether the Post Office adequately consults the public. The Post Office miserably fails the half-mile test, the viable business test and the consultation test, and it has a robotic approach to post office closures.

Seven post offices have closed in my constituency, but I will refer to only five. I will not mention the closures on Sackville street, which is in a prosperous area of my constituency, or in Rusholme in the constituency of my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman).

I will refer first to the post office in West Gorton, which closed in 2001 when the sub-postmaster retired. When he left, the Post Office promised that it intended to fill that sub-post office with another sub-postmaster, but that promise has never materialised. The Post Office has not found an alternative sub-postmaster, and a proper search for a replacement has never been considered. What is more galling is that I put it to the Post Office that a local shopkeeper was prepared to upgrade his property to act as a sub-post office, but that offer was treated with absolute contempt, with no reasons given for refusing the offer. Many elderly people live on the estate, and the nearest post office is about 1.5 miles away. That is way beyond the half-mile limit that the Post Office uses in that area, and even beyond the one-mile limit that it uses in non-deprived urban areas. West Gorton seems to have disappeared from the post office list. It has never been formally announced to me that the post office is closed; it is simply no longer open.

The Post Office originally claimed that the post office on Lower Oldham road was within half a mile of other post offices. I arranged to test that and, when somebody walked to the nearest post office with a pedometer, the distance was 0.7 of a mile. Despite the fact that we proved beyond reasonable doubt—walking the distance is a reasonable way of assessing the distance that elderly people must travel—the Post Office insisted that it was right and the sub-post office was less than half a mile from the nearest post office. I do not know what we have to do to prove that to the Post Office. Does consultation mean that, if it is demonstrated that the Post Office's rules are being broken, it stubbornly maintains its decision to close? People local to Lower Oldham road still feel a sense of injustice, particularly the elderly who find it difficult to walk the longer distance.

The Post Office originally claimed that the nearest post office to Clayton Bridge post office was within half a mile. I pointed out that the nearest post office was 0.6 of a mile away and in the end it accepted that. However, there was no good grace in its recognition. A Post Office representative wrote to me about the decision regarding the future of the branch. The letter read: I have received a number of comments from customers and local representatives … These centred on how such a permanent closure would affect the community and local businesses. Concern was also expressed that the disabled and pensioners would find the alternative branches too far away. The letter continued: Although I believe that other branches nearby are suitably located, offering the right services to meet the needs of the local community, I have carefully reconsidered my original decision". There was no recognition that the Post Office had simply got the distance wrong, or an apology. It even reaffirmed that other branches were suitably located when clearly, by the standards that the Government asked the Post Office to put into practice, they were not.

I welcomed with good grace what I saw as a reprieve for the Clayton Bridge post office. However, in the months following, the Post Office did little to find new premises. It finally wrote to me saying that it intended to close Clayton Bridge permanently, as it had advertised the vacancy but no alternative was available. As a vacancy for a new property could only be advertised locally, I asked if local people knew about it, but they told me they were unaware of it. Once again, by its own test, the Post Office badly let down the community of Clayton Bridge.

The Post Office wrote to me about the university precinct post office, saying that its proposal to relocate that office had been made to secure the long-term provision of the post office services in a new outlet. The Post Office told me that as it was a relocation, not the closure of a post office, the rules about distance no longer applied. It said: The assurances that had been given to ensure, wherever possible, that we will not close any post offices in urban deprived areas unless there is another branch within half a mile were given as part of the commitment to our Network Reinvention programme. However, our proposal to relocate University Precinct is not part of that programme but is part of our day-to-day management of our nationwide network of offices. In other words, as long as the Post Office says that it is not a closure, but another kind of restructuring, it can ignore all the rules that the Government asked it to abide by and close post offices willy-nilly, despite the fact that many elderly people cannot travel the 0.7 miles to the relocated post office.

What makes the situation even more annoying is that the existing owner of the property that had housed the sub-post office wanted to continue to offer the Post Office a lease, but it refused to continue negotiations with the landlord, and in doing so seriously disadvantaged the traditional users of the post office.

However, perhaps the most perplexing decision was that concerning the Moss Side post office. The story is almost bizarre: local rumour said that the post office was due to close. I contacted the Post Office; I will not mention the names of those involved, although the names of some of the senior officials should be in the public domain, so that when they are put in the stocks with dunces' caps on their heads they can be properly pilloried. I give thanks to my colleagues who have been so supportive of me in this Chamber.

The Post Office originally denied that it had any intention to close the Moss Side branch, saying that the rumours about its closure were false. Later that day, when my office queried what the Post Office said, because local people insisted that the branch was to close, it said, "Yes, there is a temporary closure." That seemed to be all right; as I had complained about its failure to get its act together, the Post Office wrote to me saying that it was not such a big deal. It said: We are working hard to explore ways to restore normal services. It said that there were a number of branches within a mile of that sub-post office, but once again, the constant reference to a mile denies the fact that all the sub-post offices in my constituency should be measured by the half-mile test, which the Minister agreed with the Post Office and which the Post Office so cavalierly ignored, as shown in my earlier examples.

I was delighted to receive a letter from the Post Office on 3 July saying, We are currently developing a proposal for the future of this branch and hope to take this to public consultation in the near future. That delighted local people, as it gave them great heart. They thought that the post office had been closed only temporarily and was on its way back. However, three weeks later the Post Office wrote to me saying that its proposal for the future was to close the branch. I replied, complaining bitterly and accusing the Post Office of extreme had faith and dishonesty, because, de facto, it allowed the public to be deceived. I think that that is lying, in the parlance of the outside world. I can say that about the Post Office and its senior managers because, I am afraid, that was the reaction induced in me. That decision was very unfair. I then received a letter from a senior Post Office manager, who said: The phrase 'currently developing a proposal for the future of this branch' could. I accept, easily be interpreted to mean that we were committed to keeping the branch open. Although we were open-minded in our approach to the issue, closure was always one of the options. Of course closure was always one of the options, because in every case in which the Post Office has consulted in my constituency, it has ended up closing the branch that it originally targeted, although it has temporarily wavered.

In the Moss Side case, there has been a slight reprieve. The Post Office wrote to me on 29 September saying that the proposal to close this branch will be deferred until the implementation of the plan in this area", which takes place in April next year. It omitted to say that it was keeping that post office temporarily closed, so the fact that the branch had been given the reprieve made no practical difference. It made no difference whatever to the elderly people, or to the 85 per cent. of that post office's customers who use it to claim benefits.

In summary, I am extremely frustrated by the robotic and inconsiderate way in which the Post Office is closing branches in my area. No test of financial viability—as in Moss Side or in other areas where sub-postmasters are willing to take on the business—seems to make any difference to the Post Office. Given an excuse to close, it closes. It goes through a formal consultation process, but that makes no difference to the result. The half-mile test that the Minister negotiated with the Post Office is cavalierly and regularly ignored. In the end, the many people who depend on the Post Office, both as a business and in its role as a part of the social fabric—a role that the Government recognised in the negotiations—are ignored by that very Post Office. People of the inner cities are treated with enormous contempt.

I raise the matter today because I would like some retrospective justice and a review of some of those Post Office decisions. I know that traditionally the Government take an arm's-length view, but the Minister is responsible for policy on the Post Office and he ought to ask it to justify the examples that I have given, rather than simply to comment on them. It needs to justify those examples properly because next year, when my constituency, like all other constituencies, is faced with the reinvention programme, the Minister will have—I assure him of this—pressure from me once more if the Post Office handles the issues in the same contemptuous way.

I hope that the Minister will contemplate what I have said. Perhaps he could write to me on the detail that we have had to race through today. I hope that he can give me some comfort that next year the process will be handled in a way that is satisfactory for my constituents.

4.17 pm
The Minister for Energy, E-Commerce and Postal Services (Mr. Stephen Timms)

I congratulate my hon. Friend the Member for Manchester, Central (Tony Lloyd) on securing the debate. I apologise to him for my delayed arrival. I am grateful to the Under-Secretary of State, Office of the Deputy Prime Minister, my hon. Friend the Member for Pontefract and Castleford (Yvette Cooper), who remained longer than she might otherwise have done.

My hon. Friend the Member for Manchester, Central made some important points and he has shown a lot of interest in this subject over a long period. He has raised his concerns with me on a number of occasions, and I agree with the points that he made about the importance of the post office network to communities in constituencies such as his—in some ways similar to my constituency—as well as those in rural areas, where there has sometimes been more focus on such matters. The Post Office plays an important role in inner-city areas as well. I completely agree with the point that he made on that.

That is the background to our determination to maintain a viable nationwide network of post offices they are so important as a focal point for their communities, particularly for elderly customers and for people who are less mobile than others. I will pick up some of the specific points that he made about the branches in his constituency. However, it is worth setting out the background to the changes happening in the post office network.

In 2000, the performance and innovation unit produced a report that was widely welcomed and that has formed the basis for the Government's policy on the post office network since then. We accepted all its recommendations. It was also widely welcomed by the National Federation of Sub-Postmasters and others. Among its recommendations was that, if the Post Office decided that fewer offices were needed in some urban areas because of there being less business for the post office network than in the past for a variety of reasons, the Government should consider providing funding to ensure that affected sub-postmasters could be compensated adequately for the loss of their business.

Last November, following parliamentary approval of the funding, Post Office Ltd. initiated its urban network reinvention programme, which will be taken forward in Manchester by the exercise to which my hon. Friend referred. The closures that he mentioned in the debate are mainly outside that process. The pattern for the whole area will be set out in a proposal by the Post Office before long.

I wish to pick up particularly on the half-mile issue to which my hon. Friend referred. At present, there are 17,000 branches of the Post Office throughout the country. That is more than all of the banks and building societies put together. More than 1,000 urban sub-post offices have at least 10 other post offices within a mile. That is reflected in the difficulties in my hon. Friend's constituency. Sub-postmasters have been finding it increasingly difficult to earn a reasonable income from their business and they have been leaving the network.

If action had not been taken under the reinvention programme and had the Post Office not taken it forward in the way that it has, there would be an unmanaged decline in the network and many serious gaps would open up. The examples to which my hon. Friend referred are illustrations of that starting to happen. I regard the urban reinvention programme as an alternative to that. It is a properly managed process that recognises that there is no longer the volume of business going through the post office network that there was in the past. I recognise equally that we must ensure maintenance of a network of post offices that serves each part of the country.

Some two thirds of the urban population live within half a mile of two or more post offices. Many of those offices have been struggling to survive. My hon. Friend knows that the Post Office must make decisions about the operational matters of its own account, a policy that has been established for a long time. The closures that have been mentioned in the debate have happened for various reasons, but it is important that we protect and safeguard the network throughout the country.

We asked the company to make sure that, other than in exceptional circumstances, its urban reinvention proposals should not include offices within the 10 per cent. most deprived urban wards in the country where there is no other post office within half a mile. The deprived urban post office fund has been established to help offices in urban, deprived areas thought to be at risk of unplanned closure. However, the Post Office is not in a position in which it can guarantee that it will not close offices in urban, deprived areas or, for that matter, in any other part of the network, for reasons that are outside its control, such as where there have been contractual problems or a sub-postmaster has retired and the company has not been able to find a suitable replacement. I understand that that has happened in several offices to which my hon. Friend referred.

Tony Lloyd

Of course the Post Office says that it is right. The problem is that there is no evidence to that effect. In one case, no one knows where the Post Office has looked for alternative property. In another case, when I was prepared to introduce those involved to a viable local business undertaking another activity, which was willing to take on the post office business, it simply dismissed that out of hand. The test of viability, especially in the latter case where the next post office is one and a half miles away, should have kicked in, but the Post Office did not want to know.

Mr. Timms

I am concerned to hear those points, but I was pleased to hear my hon. Friend say that the Post Office has deferred the decision on Moss Side and that that branch will be considered when the Post Office announces its area plan for Manchester, Central next May or June. He said that he took that as a positive sign.

I shall comment a little on the other branches that my hon. Friend mentioned. I am told that in West Gorton the sub-postmaster simply wanted to leave, following a number of armed attacks on that branch. I am assured that a good deal of effort was made to find a replacement there, although I take my hon. Friend's point that one simply has to accept the Post Office's word for that. I gather that there were a number of contractual difficulties at the Clayton Bridge branch on Holyrood street and that, again, the Post Office was unable to find a suitable replacement. In the case of the university precinct branch, there were some accounting irregularities, and the lease expired. For some time, the branch had been run by a temporary sub-postmaster, but the company formed the view that it was becoming increasingly commercially unviable. It opened a new outlet at Wilmslow Park, which I understand is some way away—about three quarters of a mile—but has much better facilities.

The exercise through which we are now going is partly aimed at the goal. which the PIU report set out, of bigger, brighter, better Post Offices with improved facilities, where there has been serious investment, often for the first time in a long time, to make them more welcoming and attractive places where people will want to go. Increasingly, we want to see the Post Office providing banking services in communities such as those that my hon. Friend and I represent. We have invested £500 million in the technology needed for the Post office network to offer its customers banking services, which, among other things, will contribute towards tackling financial exclusion.

I shall say a little on how we see the process of urban reinvention unfolding between now and the end of next year, when it should be complete for the whole country. Proposals were initially focused on single offices known to be most at risk because of poor viability. That was to minimise the incidence of unplanned closures of the kind that have caused such great difficulties in my hon. Friend's constituency. However, the Post Office accepted that much uncertainty about the future shape of the network arose from that approach, so it has now undertaken to produce its proposals on an area-by-area basis using each parliamentary constituency or groups of constituencies. My hon. Friend will agree that that approach is better, because we can all see where that process is leading, rather than simply having one branch considered at a time. In its recently published report on the post office network, Postcomm has commended the Post Office for that response to the concerns raised. The Select Committee on Trade and Industry also welcomed the different approach.

I understand that other than for the Moss Side branch that we have discussed, there have not yet been any proposals under the programme to close branches in my hon. Friend's constituency. It is proposed to introduce next May or June the area plan for Manchester, Central, along with those for Manchester, Blackley; Manchester, Gorton; and Manchester, Withington. Producing an area-wide plan in that way will bring the benefit of providing a clear view of the level and location of service provision at the end of the urban reinvention programme in a given area, while also providing the opportunity to understand the views of hon. Members and local authorities on those wider plans. That will be an important tool in ensuring that the offices in my hon. Friend's constituency are viable, will be there for the long term and are in the right locations for his constituents. It will also help to reassure sub-postmasters about their prospects. I hope that it will also guard against the kind of unplanned closures to which my hon. Friend referred. I entirely understand his concerns about those.

Question put and agreed to.

Adjourned accordingly at half-past Four o'clock.