Letter Post Service (Hansard, 28 February 1985)

§ Mr. Pattie

I have now received the initial response of the Post Office to the report of the Monopolies and Mergers Commission published last September. I am placing copies of the Post Office's response in the Library of the House.

I regard it as a very serious matter that the commission was unable to come to a firm conclusion that the Post Office was not pursuing a course of conduct which operates against the public interest in providing a letter post services in London, Belfast, Cardiff and Glasgow. The commission suspended judgment on the public interest question taking the view that this would depend chiefly on whether the Post Office made adequate efforts to implement charges which were largely common ground between the Post Office and the commission.

The Commission has produced a particularly thorough and comprehensive report and has made 78 recommendations covering financial control, costing and forecasting; efficiency measurement; personnel and industrial relations; mechanisation; and quality of service. The commission took the view that the Post Office should give immediate and particular emphasis to introducing a proper system of work measurement and work standards; introducing more effective budgetary control and developing a better understanding of the costs of the business; and completing the letter post plan and bringing its performance up to the levels of efficiency recommended in the report by the dates stated.

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In its response, the Post Office has accepted 76 of the 78 recommendations and has indicated that, in many cases, the recommendations reflect the direction of Post Office thinking and action already in hand.

A number of the recommendations have major industrial relations implications. The Post Office has been engaged in a series of major discussions with the Union of Communications Workers with the aim of achieving a negotiated programme of reforms and improvement including those related to the commission's recommendations. These discussions have now reached the stage where the UCW has called a special conference for 4–6 March to seek to remove restrictive mandates imposed by previous conferences covering amongst other things new technology, mechanisation, work measurement and the balance between overtime and incentive payments. The Post Office recognises the value and importance of a successful conclusion to these negotiations and would prefer to resolve any differences with the UCW in this way. However, in its response, the Post Office has indicated that, in the absence of a negotiated settlement, it is prepared to introduce the required measures by executive action as the commission has signalled that it should.

The Post Office's response indicates that some progress is being made in relation to the commission's recommendations in some areas of work measurement and standard times. This is also true in relation to certain of the recommendations for improving budgetary control. The Post Office has decided to create a permanent team of mails network inspectors as part of a co-ordinated drive for improved quality of service performance at every level of authority in the postal business. The commission made a number of other recommendations aimed at bringing quality of service performance up to target levels of 90 per cent. of first-class letters delivered the working day following collection and 96 per cent. of second-class letters delivered by the third working day following collection. The Post Office has accepted all of the commission's recommendations in this area.

In view of the commission's findings on the public interest, I attach importance to positive action by the Post Office to implement the commission's recommendations speedily. My Department has begun discussions with the Post Office on a detailed implementation plan with provision for progress checks and a timetable for full and rapid implementation of those recommendations accepted by the Post Office. I propose to make a further statement once these discussions are concluded.