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Post Office Closures

Part of the debate – in the House of Commons at 3:38 pm on 15th May 2002.

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Photo of Vincent Cable Vincent Cable Shadow Spokesperson (Trade and Industry), Liberal Democrat Spokesperson (Trade and Industry) 3:38 pm, 15th May 2002

I think that the hon. Gentleman agrees with me, and I take his intervention as constructive. I want to mention one small problem in reference to my hon. Friend Sue Doughty, who has pointed out that one of the sources of uncertainty is that it is not always terribly clear whether the post office being talked about is urban or rural. She has a village in her constituency called Shalford, which I think has been reclassified as urban to permit a closure to proceed. There may be a conspiracy theory at work, but anyway the post office, which would have been protected under the rural programme, is now being exposed to closure. That kind of device is being used everywhere.

In towns, the Government have an urban renewal programme, which, when it was announced, seemed attractive. We now know, however, as many postmasters have had letters in the last week, that 3,000 of those 9,000 post offices are likely to be closed. In some cases, there may be commercial logic to that. Some post offices are close together, but many of them are not. In Twickenham two years ago, a post office closed for six months after a problem of dishonesty had been discovered. No bus service was available and that meant that many pensioners had to walk a mile in one direction or a mile in another direction to reach another branch. That problem will be repeated many times in urban areas when a third of all branches close.

We now know that the label for the Government's urban renewal programme is desperately misleading. The programme is about closures, and who will decide whether a branch should shut? There will be an arbitration process that will be looked after by Postwatch, but how will that organisation evaluate 3,000 appeals in two years? It does not have the resources, so it cannot be expected to handle that number. Many branches will close willy-nilly.

I would like Ministers to address, in particular, the issue of funding. Under the comprehensive spending review, £270 million has been pledged to the network, so will they explain exactly where that money has gone and where it is going? There is enormous confusion among the beneficiaries about that.

On the general strategy, we are dealing with a big project that could go well—I do not wish to prejudge matters—but it could be a disaster. Let us therefore have a proper system of planning and of targeting objectives. At the moment, there is an enormous lack of clarity about fundamental issues—the technology used in the universal bank and the fees that will be paid. All that should be spelled out much more clearly.

If, as we gather from inside the problem, the problems are as serious as they seem, are the Government giving any thought to spreading the plans for automated credit transfer over a longer period? The Horizon project, which the previous Government introduced, is a precedent. It had to be abandoned at short notice six months before it was due to come in even though the then Secretary of State, Mr. Mandelson still endorsed the project. The technology did not work. That could very well happen again. Would it not be sensible and would it not help if the Government adopted a much more measured and deliberate approach to the introduction of the programme to ease much of the uncertainty and pain that is now felt by postmasters and postmistresses? 4.7 pm