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Post Office Closures

Part of the debate – in the House of Commons at 4:40 pm on 15th May 2002.

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Photo of Nigel Waterson Nigel Waterson Conservative, Eastbourne 4:40 pm, 15th May 2002

If I thought about it, I would be rather flattered by the desire of hon. Members on both sides—albeit with similar accents; hence my initial difficulty in identifying the hon. Gentleman—to know our policy. It cannot have escaped his attention that barely a year ago we lost a general election, but let me remind him that we are firmly on record as saying that we are in favour of competition, although for better or worse the Ministers here today will have to deal with Postcomm's recommendations. I should add that many of the submissions from Consignia and from the union that oppose the Postcomm proposals seem pretty threadbare intellectually.

Despite all the problems, the Post Office had one priceless asset that could not be destroyed even by inept management, bolshie unions or interfering Ministers—the brand. The names of the Post Office and the Royal Mail were recognised throughout the country and the world. They were up there with Coca-Cola and Microsoft. So the Post Office decided to destroy the brand at a stroke by renaming itself Consignia—at a cost of £2 million, to boot. Now even the chairman of Consignia and the Secretary of State admit that it was a mistake. In an article in the Daily Express only yesterday, the Secretary of State made the same point again. It is inconceivable that Ministers did not give their approval to the name change.

We have heard pious words of concern from the Secretary of State, who seems finally to have woken up to the dire problems facing the Post Office. As she said in yesterday's Daily Express:

"The Post Office has simply failed to adapt to modern life . . . more changes will be needed, affecting the consumer as well as staff."

I am sorry to upset Geraldine Smith, but the Secretary of State also said:

"I think consumers would accept it if it guaranteed one reliable delivery every day."

She also mentioned the possibility of a pay rise, and her great new idea to save the Post Office from its losses of £1.5 million a day:

"postmen could collect and deliver cash . . . and sell stamps" on the doorstep. That should make all the difference.

Little did Post Office managers or workers or the British public realise that while the Secretary of State was uttering pious sentiments about improving the Post Office, she was secretly planning to flog it off to the highest bidder.

Earlier this year, my noble Friend Baroness Miller pressed DTI Ministers in another place. In reply to her question on 21 March about whether there were negotiations on selling Consignia to TPG, which operates the Dutch post office, Lord Sainsbury said:

"I have heard of no such suggestion."

In answer to a subsequent question from Lady Blatch he said:

"I know of no negotiations which are taking place to sell the post office network, which I assume is the point of the question. I have no indication that any negotiations have ever taken place on that."—[Hansard, House of Lords, 21 March 2002; Vol. 632, c. 1471-73.]

The following week, reports surfaced about the TPG group's interest in Consignia, and on 26 March the Secretary of State replied to a written question from my hon. Friend Mr. Whittingdale as follows:

"There are no proposals to sell Consignia Holdings, its mails business, Parcelforce or the network of post offices."—[Hansard, 26 March 2002; Vol. 382, c. 800W.]

She could not have been clearer.

Unfortunately it emerged later that that answer was not strictly accurate and that Lord Sainsbury had been even less accurate. He had to admit to the Lords on 30 April:

"I believe that the answer now is 'Yes, there were merger discussions. However, as I explained then, I was not aware of those discussions at the time."—[Hansard, House of Lords, 30 April 2002; Vol. 634, c. 569.]

Of course, we must give Lord Sainsbury the benefit of the doubt and assume that he is right to say that he knew nothing about those negotiations. However, it is equally clear that detailed talks on selling Consignia—our Post Office—to the Dutch post office took place for some eight months.