Charles Hendry MP: The Government's botched Post Office closure process

Charles Hendry MP, Shadow Minister for Postal Affairs, explains why the consultation process was a sham and Labour MPs should vote against the unnecessary closures.

Post offices are like any other business.  They have to move with the times, if they are to survive.

The debate that Conservatives have called today is not about whether they need to change, but how they should change.  As more and more people work online, traditional areas of business have declined. Government and other organisations are right to find the most efficient way of delivering their services.

So, if our post offices are to survive, the Government needs to have a positive vision for the role they should perform.  That is precisely what is missing today.

Ten years ago there were some 18,000 sub-post offices.  Today there are 14,000 and that figure will drop to 11,500 as a result of the closure programme.  One third of the whole network will have closed in little over ten years – a closure rate three times higher than ever in the past.

Worse than that, the Government simply does not have the policies to not guarantee a further decline of the network in future years. The process of gradual attrition will just continue.

There should be no doubt that this is not the Post Office’s closure programme.  I have great respect for the work Adam Crozier and his team are doing to try and modernise the Royal Mail, but they are being forced to implement a closure programme imposed on them directly by the Government.

The Government has decided on the overall funding for the post office and determined that 2,500 should close; the Government has determined the flawed ‘access criteria’ which are being used to decide which ones should close; and the Government has forced through a consultation process half the length recommended by its own Cabinet Office.

The right policy, consistently advocated by David Cameron, Alan Duncan and the Conservative team, would be to find, first of all, new ways of bringing additional business to the post office network.   Sub-post masters are entrepreneurs.  They want to develop new services and they want to survive on business rather than subsidy – but in this topsy-turvy world they are stopped from doing so.

They should be working with carriers other than the Royal Mail, so they can become a hub for all the carrier services that drive endlessly around our communities trying (and usually failing) to deliver packages.  They should be developing new financial services, as recommended by the Federation of Sub-Postmasters.  They should relentlessly be seeking new opportunities to make post offices the place where we can access government and local government services.

The whole basis for the closure programme is flawed, but what has angered people more is the way in which it is being carried out.

The access criteria, established by the Government to decide which post offices should close, are decided largely on geography.  Post offices which have queues all day long are being closed, not because they don’t have the business, but because a bureaucrat at a computer has decided they are simply in the wrong place.

As a result, many vulnerable people will lose a vital service in their community, even though the next post office may be some miles away, often with an inadequate bus service or along dangerous roads. People who have spent years building up their businesses will find it taken away from them. As was reported in the Telegraph on Monday, if they are not to have their compensation cut, there will even be a bar placed on the type of services they can offer in the future. Too often, when the post office goes, then the last shop in the village goes as well – and once they have gone, the prospects for ever opening again are remote.

There is also understandable anger at the timing of the consultations.  The Cabinet Office clearly recommends that consultations of this type should last for 12 weeks; in defiance of its own rules, the Government has set a maximum of six weeks.

Some of these consultations took place in the run-up to, or during, the Christmas holidays, when people’s thoughts were inevitably elsewhere. People simply did not have the chance to make the strongest representations or involve their whole communities.  In every part of the country, huge numbers of people, often elderly or disabled, have turned out on dark, cold nights to show their support for their local post office –the Government hasn’t yet recognised their anger, their pleas and concerns have been largely ignored.

People have concluded the consultation process is a sham, with only one or two being saved from closure, out of dozens being proposed in each area.

Even more insidious is the decision that for each one saved from closure, another should be added to the list. There could not be a more divisive formula to pit community against community.  That is what has angered people when they see Cabinet Ministers, who have forced through the closure programme, arguing that their local post offices should be exempt.  It’s not that they should not stand up for their constituents’ interests, but they are using their weight to have one less closure in their own constituency and to force one more in someone else’s.

Across the country, MPs of all parties are arguing that local post offices should be saved from closure.  Three-quarters of the MPs whose constituencies are affected so far have argued for exemptions.  Opposition on that scale shows that it is not just the consultation process, but the whole concept, that is flawed.

On their websites and in their local papers MPs (including Labour MPs) have argued that the access criteria are flawed.  They have criticised the way the consultation process has worked.  They have called for more time to explore new business opportunities and to see how post offices can do more with local councils.  They are right on all counts.

The closure programme has been a botched exercise. Now MPs have to show that these concerns are more than just words, by voting to suspend the closures whilst the Government looks afresh at the whole future of the network – and how we can find new business rather than just manage its decline.

Those who fail to do so will forever be seen as people who will say whatever is necessary to win votes in their constituencies, but when they had the opportunity to do something to stop these closures, chose to do nothing.

Related link: Jonathan Sheppard's perspective on the closures

Comments

[Jonathan Sheppard]

A further key point is that under the minimum access criteria - only 7,500 branches are required to fulfill that obligation.

So when the current funding arrangement runs out in 2011 will we be going through the same painful process again? I wouldn't be surprised.

[Malcolm Dunn]

I agree with Charles that the only way many Post Offices will survive is to allow them to expand their commercial remit beyond the Royal Mail.
I'm delighted that the Conservative controlled Essex County Council has taken the lead in proposing a solution. But it is a solution that can only be temporary or the council tax payer will just replace the taxpayer as the providers of ever increasing subsidy.
Agree too,that the 'consultation' was a farce from day one. To coin a phrase 'they take the public for fools'.

[David]

The closure programme is politically damaging for Labour, and is ONLY happening because the European Commission is forcing it through capping state aid and making even this temporary. A great institution is now crippled to allow non-UK competitors to cream off its business in the interests of a 'single market' in services. Royal Mail is forced to deliver mail to letterboxes for other companies (some state owned) at crazy low rates. Of course, other EU states aren't reciprocating.

[Christina Speight]

It is indeed a scandal that Post Office services are being withdrawn wholesale. But a bigger scandal is that the government refuses to point the finger of blame at the culprit.

The government is being forced to do this by our real government in Brussels who have decreed that the maximum subsidy for this service shall be £150 million a year. The EU is where the power lies and no appeals to traditional national customs cut any ice at all.

The biggest scandal of all is that the British people have allowed their power to run their own lives to be given away by a corrupted political class.

[David Boothroyd]

Christina Speight is wrong. The EU has directed that mail delivery services be opened to competition without subsidy, and is inquiring about state aid to Royal Mail, but that inquiry explicitly does not include state aid to Post Offices. The Commission accepts that they are a social service and not a business. (http://uk.reuters.com/article/domesticNews/idUKBRU00549620070307)

There is no limit placed on the amount of state aid to Post Offices so long as it is "necessary to cover the costs of public service obligations". The UK government can define what is the public service obligation in Post Offices.

Introducing further commercial services to the Post Office network will actually diminish that. To preserve an extensive network of Post Offices requires subsidy either from national or local government. It is unfortunate that the Conservatives have not yet recognized this unavoidable fact.

[Patsy Sergeant]

David Boothroyd, I think that you are suggesting that the responsibility for these closures is entirely the present government's, who just want to save money at any cost, and that the 'package' business is a kind of smokescreen.

I suppose the government 'employed' some so-called agency, or a company of some sort, to come up with the list of post offices, that they thought could be closed, or perhaps they just stuck a PIN in the map! I am sure it is highly likely that the people involved with making the list had NO knowledge of even the basic function of those post offices letalone the wider function in the community.

It seems to me that what this whole exercise demonstrates is that Mr. Brown's protestations of 'caring' about poverty, the elderly and the disadvantaged, are as much an illusion as the 'package', because those are the groups who are most likely to use postoffices most, due to having no PC or access to the internet.

[Mark Wadsworth]

Fundamental to the whole debate about the survival or closure of rural post offices is the question, are post offices...

1. Businesses like any other, which should not be getting subsidies and have to survive or fail like any other, or

2. Providers of 'merit services', like child nurseries or public libraries, i.e. services that would be provided by private businesses if demand were there, but which ought to be subsidised/publicly provided to make them available to more people. In the case in hand, we do have to at least consider old people who refuse to get involved in internet banking and so on and may not be able to travel miles to the next nearest bank or cash machine etc. or

3. Public goods, i.e. a core function of the State like law'n'order, protection of private property rights or defence, for which there is no real free-market solution, and which must be paid for out of general taxation?

If the answer is 1, then of course Post Offices should not get subsidies, end of debate.

If the answer is 2, then remembering that the state is lousy at actually running anything, this is a case for local taxation, i.e. there should be a separate line on your council tax bill showing your share of the subsidy paid to the local Post Office, and of course the council should also publish details of how much subsidy each individual Post Office receives. Then every council tax payer can make up his or her own mind whether it's worth it or not.

If your answer is 3, then I'm afraid you haven't understood the question.

[Patsy Sergeant]

Mark Wadsworth I object to your verb 'refuse' (as you probably expected!), many older people and some younger cannot afford computers, letalone learn to 'surf the net' etc:! At the end of last year I enrolled as a 'guinea pig' to take a course organised by U3A and some Continental Universities, even part financed by the EU, the course is aimed at those people who are still not computer literate, and the plan is for there to be central facilities, somewhere, where people of this age group can congregate and use the computers for free, not internet cafes.

So there are many people out there, who for various reasons do not use a computer letalone internet banking, and actually, as someone who probably 'gets around' in the high street more than you do (anchored in your office), I do come across a surprising number of people (by no means all OLD) who don't even know how to use a computer. It is true that most of them are women. And I might add to that, with husbands/partners who either hog the computer or belittle the wife's efforts to learn. And I did see an example of that when the group of us were interviewed for this course!

[Mark Wadsworth]

Patsy S, OK, I withdraw the word "refuse" and substitute the phrase "do not have access to a computer to enable them to ...".

[Tommy]

What other extra business might post offices do? What sort of local government services could be accessed at post offices, and would that mean that local government ends up subsidising the post office network, rather than central government - as is already beginning to happen in Essex?

[Deputy Editor]

Close one! The amendment has sadly been defeated by 20 votes.

[George]

can somebody tell me which Labour MP's rebelled?

[John]

Now there's a surprise!
A bunch of Cons pretending they are useful and can do something about which they have no control over. Sorry Guys - must try harder - there's an ever decreasing circle of people who believe these publicity stunts.