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Oral Answers to Questions — Post Office – in the House of Commons at 12:00 am on 31st July 1957.

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Photo of Mr Arthur Lewis Mr Arthur Lewis , West Ham North 12:00 am, 31st July 1957

asked the Postmaster-General on what basis it is estimated that the increased postal charges will only increase the retail price index by one-tenth of one per cent.; and to what extent in these calculations the direct and indirect effects of such increases on local authorities, nationalised boards, Government Departments, and private business, in addition to the effects on private individuals have been included.

Photo of Mr Ernest Marples Mr Ernest Marples , Wallasey

The figure I gave was a rough estimate of the effect on the retail price index in so far as Post Office charges enter directly into the calculation of that index. Indirect effects through the prices of other components of the index could only be guessed, but would be quite small.

Photo of Mr Arthur Lewis Mr Arthur Lewis , West Ham North

If the Postmaster-General does not know, how can he guess whether it is larger or smaller? Can we be assured that his action in again increasing these prices is but another step in the implementation of his promise to reduce the cost of living, "mend the hole in your purse". and make the £ worth something?

TABLE I
ESTIMATES FOR MAIN ACCOUNTS, 1956–57 TO 1958–59 (After tariff changes)
1956–57
(£ million)
PostalTelephoneTelegraphTotalCumulative Total
Income174·2163·518·3356·0
Expenditure177·5164·520·3362·3
Surplus- 3·3- 1·0- 2·0- 6·3- 6·3
1957–58
(£ million)
PostalTelephoneTelegraphTotalCumulative Total
Income190·3183·518·9392·7
Expenditure190·9178·522·2391·6
Surplus- 0·6+ 5·0- 3·3+ 1·1- 5·2

Photo of Mr Ernest Marples Mr Ernest Marples , Wallasey

The increases in charges was made to correct the wages of Post Office workers and to bring them into line for the first time with those of outside industry. If the hon. Member does not want that he should oppose the wage increases.

Photo of Mr Richard Winterbottom Mr Richard Winterbottom , Sheffield, Brightside

asked the Postmaster-General (1)the extra sums he estimates that he will receive for each item of the recent increased charges this year, and in a full year;

(2)which of the Post Office services will be making a profit and which a loss, and what is the amount in each case, consequent upon the changes proposed in the recent White Paper on Post Office Finances.

Photo of Mr Frank Allaun Mr Frank Allaun , Salford East

asked the Postmaster-General the estimated profit or loss on the telephone and postal accounts. respectively, for 1956–57, 1957–58, and 1958–59 after allowing for the proposed new charges.

Photo of Mr Ernest Marples Mr Ernest Marples , Wallasey

As the Answer involves two lengthy tables, I will circulate it in the OFFICIAL REPORT.

Following are the tables:

1958–59(£ million)
PostalTelephoneTelegraphTotalCumulative Total
Income204·2193·719·0416·9
Expenditure199·8184·422·5406·7
Surplus+4·4+9·3-3·5+10·2+5·0
Cumulative Total+0·5+13·3-8·8+5·0
TABLE II
DETAILS OF TARIFF YIELDS AND PROFITS OR LOSSES
1957–58
Yield from tariff changesProfit/Loss
£m.£m.
Postal
Inland
Letters6·1+10·2
Postcards0·25-0·05
Printed papers, samples, newspapers1·35-1·05
Parcels0·75-4·25
Registration-1·9
Miscellaneous0·15-0·05
Overseas
Surface and "all-up" letters and postcards0·65+0·25
Surcharged air mails-0·2
Printed papers and samples0·75-3·05
Parcels0·45-0·25
Registration and insurance0·1-0·3
Miscellaneous0·05+0·05
Remittance
Postal orders0·8+0·7
Money orders-0·8
11·4-0·6
TELEGRAPH
Ordinary inland telegrams-3·7
Inland private wires+1·2
Inland telex+0·1
Other inland services-1·1
Overseas services0·1+0·2
0·1-3·3
TELEPHONE
Rentals, connection and removal charges7·8-5·1
Subscribers' local calls2·3+1·0
Subscribers' inland trunk calls0·1+9·7
Call Offices0·1-3·1
Inland private wires+1·5
Other inland services-0·3
Overseas services+1·3
10·3+5·0
TOTAL21·8+1·1
Note
The yield from the tariff changes in a full year will be double that for 1957–58 except in the case of (a)Subscribers' local calls and (b)Subscribers' inland trunk calls and call offices, for which the full year yield will be £2·0m. and nil respectively.

Mr. Watkins:

asked the Postmaster-General whether he has considered abolishing the extra charges asked of telephone subscribers who live three miles or over from a telephone exchange or to increase the radius from three to five miles or more.

Photo of Mr Ernest Marples Mr Ernest Marples , Wallasey

Yes, Sir; but these lines are very costly to provide and it would be unreasonable to ask all other subscribers to share the whole burden. I understand that in most other countries an extra charge is made for lines much shorter than three miles.

Mr. Watkins:

Would the Postmaster-General look at this matter again in view of the fact that it is one of the factors which retards the re-population of the countryside? It is rather important. It has been on the Statute Book, at least by regulation, for a very long time.

Photo of Mr Ernest Marples Mr Ernest Marples , Wallasey

A survey was made in 1955 and it showed that the annual charges for maintenance, interest on capital, and depreciation totalled £16 to £29 per mile. The present charge is £12 per mile—£6 for a shared telephone—and the new charge still does not always meet the actual cost.

Photo of Mr Reginald Sorensen Mr Reginald Sorensen , Leyton

asked the Postmaster-General what rearrangements or economies in the postal service he is considering that may enable him subsequently to modify the prospective increase in postal charges; and how far economy is possible through the institution of certain deliveries of letters at lower postal rates outside peak delivery hours.

Photo of Mr Ernest Marples Mr Ernest Marples , Wallasey

We shall continue to look for all practicable economies, but I see no prospect of modifying the increases in charges which I announced recently. Schemes of the kind the hon. Member mentions in the second part of his Question have been gone into very thoroughly on many occasions in the past; they have always been judged to be impracticable and uneconomic but we are going to look into the possibilities again.

Photo of Sir Raymond Gower Sir Raymond Gower , Barry

Would my right hon. Friend agree that the large number of Questions on the Order Paper on this matter indicates a fairly widespread concern in the community that the services administered by his Department, particularly the telephone service, should not increase in cost in future years or at an early foreseeable date? Would he agree that, despite the increases in wages to which he has referred, the general prosperity of the country since the war has enabled the Post Office, and the monopoly services administered by his Department, to acquire a great number of new customers, and should not that be taken into account?

Photo of Mr Marcus Lipton Mr Marcus Lipton , Lambeth Brixton

asked the Postmaster-General why he has increased the postal charges to provide an estimated surplus of £5 million by March 1958.

Photo of Mr Ernest Marples Mr Ernest Marples , Wallasey

The hon. Member is mistaken. The prospect of a £5 million surplus does not arise before 1959.

Photo of Mr Marcus Lipton Mr Marcus Lipton , Lambeth Brixton

Will the Postmaster-General nevertheless explain why the poor old British public has to be soaked to the extent of £5 million more than is necessary to maintain the present postal services? What is the right hon. Gentleman going to use this £5 million for?

Photo of Mr Ernest Marples Mr Ernest Marples , Wallasey

As the turnover of the Post Office is £400 million a year, the surplus of £5 million is not excessive. When the Labour Party was in office the Post Office had a surplus of 8 per cent. of its turnover. If we had budgeted for that surplus we should have been budgeting for a surplus of round about £80 million.

Photo of Mr Arthur Woodburn Mr Arthur Woodburn , Clackmannan and East Stirlingshire

Would the surplus be increased very much if less transparent envelopes were supplied at the post office to hon. Members? We could almost have a system of letter tapping as well as of telephone tapping, the envelopes being so transparent that anybody might read the letters.

Photo of Mr Marcus Lipton Mr Marcus Lipton , Lambeth Brixton

In view of the complete failure of the Postmaster-General to answer this Question satisfactorily, I hope to raise the matter on the Adjournment as soon as possible.