Longlevens Post Office

– in the House of Commons at 9:44 pm on 22nd March 2004.

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Motion made, and Question proposed, That this House do now adjourn.—[Paul Clark.]

Photo of Parmjit Dhanda Parmjit Dhanda Labour, Gloucester 10:00 pm, 22nd March 2004

There can be few occasions on which a Member of this House relishes being forced to rewrite his or her speech just hours before a debate. This, however, is such an occasion. It is also an occasion that has taught me something about the strength of this Chamber and of Adjournment debates, and about the difference that they can make. I have had to amend my speech several times during the day because of the negotiations that I have been in with the private sector today. I shall elaborate on that and on the effect of those discussions, which have been very positive with regard to issues that affect my constituency.

Five hours ago, my constituents in Longlevens were despairing at the prospect of losing their local post office. I shared their anger about the way in which they had been treated. I knew how important it was to save that vital service, so in recent weeks, I have worked with local people in Gloucester, organising petitions, meeting them in Parliament and even raising the matter with the Prime Minister two weeks ago in Prime Minister's Question Time.

This evening, we took several steps forward towards achieving a result, although we still have some way to go to resolve the issue totally. I would like to take this opportunity to explain the background to the situation, to discuss the points still to be resolved and to seek the Minister's advice on the wider issues raised by the recent controversy in Longlevens in my constituency. It is a controversy from which I believe that there is a great deal to learn, and my experience of today shows that some learning is going on at the present time as a consequence of the experience.

In recent years, it has become a commonplace that communication has been transformed somewhat by innovation. For many of us, air mail has been replaced by e-mail and the lick of a stamp has been superseded by the click of a mouse. In such circumstances, it can be all too easy to forget the importance of our local post offices. The residents of Longlevens in my constituency value their local post office enormously. Unfortunately, that service was recently put in great danger. The licence for the Longlevens branch has very recently been acquired by Tesco, which gave just three months' notice that it intended to close the branch to create more space in its local store. My constituents in Longlevens are unhappy about the way in which the decision was taken, and so indeed am I. I am also concerned about the wider implications of closing the post office in terms of the national picture, and I hope that the Minister will be able to elaborate on that point.

That is why my office and I were so pleased this evening when I received the latest fax from Tesco; I have had two faxes during the day. It has now said that it will not shut the post office on 8 May, as it had originally intended. It has made this promise:

"it will remain in the One Stop" store

"while we search for a new location."

Of course, there is still much more to be done, and a new location in Longlevens must still be found, but I welcome this significant step forward by Tesco.

I shall elaborate on that letter, which contains three key concessions made today. First, Tesco says:

"Following our conversation earlier today . . . the resignation date of 8 May has been withdrawn."

I certainly welcome that.

Secondly, on a financial level, Tesco says:

"We understand that the cost of relocation may be deterring some of those who might consider taking on the relocated post office business. To overcome this, we have agreed with Post Office Ltd. an alternative arrangement whereby the contract transfers directly from Tesco to the new business. This would enable Tesco to significantly reduce the potential cost of relocation—we will not seek any goodwill payment for transferring the post office as a going concern and will contribute to the cost of physically relocating the post office."

I also welcome that.

Equally significantly, Tesco made a third concession hours before this debate, when it said:

"In order to maximise the opportunity for a post office to be transferred, it will remain in the One Stop" shop

"while we search for a new location."

I welcome all three concessions.

It may help if I go into further detail about the issue in Gloucester. In January 2003, Tesco purchased the T and S Group, which owned 318 stores containing post offices nationally. Although it stated that it would retain many of those post offices, reports suggest that up to 100 of them could close. It promised that it would give six months' notice wherever possible before closing a post office. In the case of Longlevens, however, it decided that it would only give three months' notice.

I say to Tesco, "Why the rush?" Post Office Ltd. is due to publish its area plan in the third quarter of this calendar year detailing the need for local post office provision in Gloucester. Tesco pre-empted the plan by deciding to close Longlevens before it saw what the plan had to say. It also failed to seek the views of local people, who were utterly dismayed by the total lack of consultation. Indeed, the public interest did not seem to feature in its initial calculations.

In my view, that is evidence of a wider lack of strategic thinking about the future of post offices in Gloucester and a lack of effective co-operation between Post Office Ltd. and Tesco. This incident, and others like it, threatens to undermine the Post Office Ltd. urban reinvention programme. Under the programme, the Oxstalls branch, which is also in Longlevens, was recently closed. Since Longlevens is just 0.9 miles away from the Oxstalls branch, it was subsequently designated as a "receiving branch", but now it, too, is threatened by closure, and its future remains uncertain. Post Office Ltd. is obliged to ensure adequate provision for customers in this area. If two neighbouring branches close within months, how can that obligation possibly be kept? The simple answer is that it cannot.

The closure seems to have surprised Post Office Ltd. as much as it surprised me and, indeed, everybody else. The situation could be exacerbated further because of uncertainty about the future of the nearby Barnwood post office. A planning application has been submitted that would involve the Barnwood site being knocked down to build flats. The operator of a nearby filling station has, however, indicated its willingness to take on the post office in Barnwood on its own site, but it is reluctant to do so until Post Office Ltd. has clarified its views on the future of services in the area plan, which will not be ready until autumn this year.

As a consequence of that, it is not inconceivable that one 12-month period could see the closure of Oxstalls, Longlevens and Barnwood post offices, resulting in a massive gap in post office provision in the north and north-east of my constituency. If one draws an imaginary circle with a 1-mile diameter around the Barnwood post office, as I have, one will see that the community that it serves includes part of the Elmbridge and Longlevens communities, which would be hit again.

In those circumstances, it is not surprising that the local community in Longlevens has come together in opposition to the plan. I cannot overemphasise to my hon. Friend the Minister how strongly local people feel about this. Thousands have signed petitions such as those organised by me and by The Citizen newspaper, and many more have phoned BBC Radio Gloucestershire, particularly the Mark Cummings mid-morning show—all calling on Tesco to think again. Tesco's letter demonstrates that it has listened, to some extent, and I welcome the dialogue that it now seems willing to take part in.

The closure of any post office will cause unhappiness among its users, but I think that I have shown that the situation in Longlevens is particularly serious. Since neither you, Mr. Speaker, nor my hon. Friend the Minister have, to my knowledge, had the privilege of visiting Longlevens—although you are both welcome at any time—I want to talk a little more about the community there. Longlevens is a thriving neighbourhood with between 8,000 and 9,000 residents. On the same street as the post office is a wide range of shops, including the Co-op supermarket, a bakery, a pharmacy and a greengrocer. As the Post Office itself would agree, the post office is not an isolated, struggling service that cannot be justified economically or socially, but in many ways the hub of its local community.

Longlevens post office is especially valued by local pensioners. More than 22.8 per cent. of the population is aged over 60—that is higher than the average for Gloucester, which is in turn higher than the average nationally. Many of those pensioners are worried that they will no longer be able to rely on having such an important amenity at a close walking distance. Can we really expect them to walk several miles once or twice a week to what will, for some of them, be an unfamiliar part of town? The benefits that they derive from the post office do not relate solely to the transactions that are processed there. For many lonely senior citizens, a weekly or twice-weekly visit to the post office and other nearby shops is an important means of maintaining social contact with others.

That point was well made by my constituent, Jackie Dee, who runs the greengrocers two doors from the post office, and who visited Parliament with her family a fortnight ago on Wednesday. Jackie and her family feel a strong sense of duty towards their local community. They know their customers well and provide them with a valued service and friendship. It is their friends and customers who will lose out as a result of the closure of the local post office. To rub salt into their wounds, Sir Terry Leahy, Tesco's chief executive, told one of my constituents—presumably in a circular letter or round robin—that the post office counter would close to provide space for a much wider range of fruit, vegetables and healthy eating options. But residents can already get that at the greengrocers run by Jackie Dee just two doors away from the post office, as Tesco could easily have discovered with a little local research—what residents want is a post office.

What can be done about the situation? In recent weeks, I have engaged constructively with local people, Tesco, Post Office Ltd. and Postwatch, which has been very helpful. It would be foolish to make any decision on the future of the post office in Longlevens until POL has published its area plan. After all, that document will provide the context for taking strategic decisions about the future of post offices.

I therefore asked Tesco to defer a final decision until the area plan was made available. Until earlier this evening, the last trading date was set to be 8 May. I asked Tesco to postpone that and give the people of Longlevens the same extensive period of notice as it gave other post offices that it intended to close elsewhere. I welcome its response, which was made only hours before the debate. I also seek a specific guarantee that Tesco will not close the post office until an alternative location has been found and is ready for business. The guarantee, "while we search" in the letter should ideally read, "until we have found" a new location.

I understand that the Co-op has shown an interest in taking over the local branch from Tesco and would keep it in Longlevens. A local church and shops are also being pursued as possible relocation options. I should be grateful if the Minister encouraged Post Office Ltd. to take into account, when drawing up its area plan, the uncertainties surrounding the future of the post offices in north-east Gloucester. It should take all necessary steps to meet its obligation to ensure adequate provision for customers in Longlevens.

The people of Longlevens have made a strong case for keeping a post office in a central location in the neighbourhood. We know that such a post office is economically justifiable as well as socially desirable. Post Office Ltd. would agree with that. We know how hard local people are prepared to work to ensure that their voices are heard. We also know the Government's commitment to investing in strong communities. I therefore hope that if we all—the Government, the Post Office, Tesco and, most important, local people—work together, we can save the service and ensure that Longlevens remains a thriving community and a great place to live.

I confess to being a Tesco cardholder, like many people in Gloucester. I shop at the Tesco store on the cattle market site in my constituency at the weekends. I have held street stalls there; the staff are always friendly and accommodating. That also applies to the staff at the Quedgeley Tesco supermarket, where I have held many surgery sessions. They have been helpful in the past and I am sure that they will be again in future. That is why I believe that it is important that Tesco works with the local community and retains a good relationship.

Headlines such as "Church attacks Tesco on Post Office closure" and "Boycott threats over closure plans" in The Citizen demonstrate the strength of local feeling on the issue. I intended to say, "By at the very least extending their date of notice until we can secure an alternative site for a post office in Longlevens, Tesco can help redeem itself", but it has already gone a long way towards doing that today. In many ways, it is a shame that it has taken until today for that to happen, but I welcome the decision none the less.

I hope that Tesco will now work with Post Office Ltd., Postwatch and local communities on the reinvention programme to stop the same thing from happening around the country. Earlier today, I was informed of similar incidents in Aylesbury and Swindon. As a result of Prime Minister's Questions and the Adjournment debate, I am conscious that Longlevens has the most famous post office in the country. However, all I want is to ensure that the community continues to have a post office. I am determined that we will succeed.

Photo of Stephen Timms Stephen Timms Minister of State (e-Commerce & Competitiveness) 10:19 pm, 22nd March 2004

I congratulate my hon. Friend on securing this debate and, as we have heard, on the developments for which this debate has provided a catalyst. I am grateful to him for letting me know the concerns that he wanted to raise, which gave my officials an opportunity to make some urgent inquiries today.

My hon. Friend spelled out clearly the importance of good access to the local post office, and he highlighted the implications of Tesco's intention to remove the post office from its store at Longlevens. Of course, Tesco's decision is a commercial matter for the company. It does not stem directly from Government action, but I recognise the uncertainty that it has placed in the minds of my hon. Friend's constituents, and I want to respond to a number of the important points that he has made. We all share concerns about the future provision of post office services in our constituencies. The Government are fully committed to maintaining a viable nationwide network of post office branches.

The Post Office is undertaking a restructuring programme of its network in urban areas. I have responded in a number of debates in this Chamber and in Westminster Hall to hon. Members who are anxious to make sure that the rationalisation of post offices in their areas does not disadvantage their constituents. Recently, I have heard from a number of hon. Members who are concerned, like my hon. Friend, about Tesco's intentions for post offices within its stores. Tonight's debate will help to clarify what is going on and, I hope, help to alleviate some of the current uncertainty.

The Longlevens post office has not been proposed for closure under the Post Office Ltd. urban post office reinvention programme. It is necessary to draw the distinction that a removal from a Tesco store does not equate to a permanent closure of a post office if the service can continue, as my hon. Friend has argued, from somewhere else nearby.

My hon. Friend rightly made the point that Tesco acquired the T and S group chain of stores at the end of 2002. Tesco took over the post office contracts for the individual sites and is reviewing how many of those post offices will be retained. The group includes stores trading under the One Stop and Dillons names, containing 318 post offices, as he said. I welcome Tesco's assurance that it will work closely with the Post Office when reviewing its stores with post offices.

Photo of Parmjit Dhanda Parmjit Dhanda Labour, Gloucester

Is there not a point to be made about tying in consultations with urban area plans as well as post office reinvention?

Photo of Stephen Timms Stephen Timms Minister of State (e-Commerce & Competitiveness)

My hon. Friend is quite right.

Discussions have been held between Post Office Ltd. and Tesco. Tesco undertakes site-by-site review, and in a minority of locations where it chooses to establish a Tesco Express format, and where the site is consequently not large enough to continue to operate a post office branch, the company may wish to end the post office contract. To date, Tesco has confirmed that it intends to remove post offices from 37 stores that are to be converted to the Tesco Express format. It has also confirmed that it will retain around 260 post offices that operate from former T and S stores, including more than 200 in existing One Stop and Dillons stores and another 50 or so in those that are converted to Tesco Express stores.

On that basis, I can confirm that the figure suggested by my hon. Friend—that about 100 post offices might go—is certainly too large. On the basis of the information that Tesco has given me, the number will be significantly less. It will not be more than 58, I think, and a decision has so far been made on only 37.

Photo of Stephen Timms Stephen Timms Minister of State (e-Commerce & Competitiveness)

I must continue in order to make sure that I put on the record points that will be of wide interest in the House.

Any decision by Tesco to terminate its contract and to remove a post office from one of its stores is, of course, a commercial matter for the company. But I know that the House would join me in urging Tesco to give careful consideration to the effect on its customers of such a decision.

The history of the post office network can be traced back as far as 1635, and it has always been reliant on private business people to operate outlets. The vast majority, about 97 per cent., of the more than 16,000 post offices around the country are run by private business people, either by individual sub-postmasters or by chains such as Tesco. Typically, 10 per cent. of the offices in the network change hands from a resigning agent to a new agent each year.

My hon. Friend pointed out that the last day of trading for the Longlevens post office was to be 8 May, but Tesco made it clear today that that planned date no longer applies. Like my hon. Friend, I welcome that announcement.

To facilitate the relocation of post office services in Longlevens, Tesco has agreed with the Post Office that the contract can be transferred directly to a new partner, the costs of relocation being met by Tesco. Those arrangements should provide the best possible chance of relocating the post office locally, in line with the hopes expressed by my hon. Friend. I welcome Tesco's more flexible approach, and pay tribute to my hon. Friend for the energetic and, as we have heard, effective way in which he has pursued his constituent's interests.

My hon. Friend mentioned that the local Co-op might be interested in taking on the service. These matters are of course commercially confidential, but I am certain that the company will ensure that my hon. Friend is notified of the resolution as soon as one has taken place.

Tesco had given three months' notice of its intention. That is the time required by sub-postmasters' contracts, and it applies equally to either side. Where Tesco wants to remove a post office branch from one of its stores, it has committed itself, where possible, to giving twice that period of notice—six months rather than three. I hope that it will keep to that commitment in future cases, because the additional time will give the Post Office a better opportunity to review the need for an office and find alternative partners to continue to offer post office services where the need remains. Tesco's commitment to delaying the removal of the Longlevens office from its store and to work to ensure a smooth transfer of the business should be applauded.

To its credit, Tesco has committed itself to helping the Post Office to maximise the prospects of a successful relocation of post offices that it can no longer accommodate in stores converted to the Tesco Express format where the Post Office needs to retain a post office in the area. It will work actively with the Post Office to find alternative individuals or businesses keen to operate the post office nearby.

I hope that it is clear from what I have said that the proposed closure of Longlevens post office is not connected with the urban reinvention programme, but I shall say a little about that programme in the context of this debate. My hon. Friend has already seen a number of post office branches in his constituency close, as he has said. The aim of the programme is to address over-provision in many urban areas and to establish a network of offices that fits the level of business now available.

Photo of Parmjit Dhanda Parmjit Dhanda Labour, Gloucester

Will my hon. Friend give way very briefly?

Photo of Stephen Timms Stephen Timms Minister of State (e-Commerce & Competitiveness)

I do not think I can. There are a couple of points that I want to put on the record.

I understand that Tesco has been made aware of the general time scale in which the Post Office is scheduled to produce its urban reinvention programme area plans, and where possible it will try to co-ordinate with the Post Office. I gather that in the case of my hon. Friend's constituency, the Post Office expects to do that in July or August. If, as in this instance, Tesco has reviewed a particular location, wants to end its contract and has advised the Post Office before the drawing up of the urban reinvention programme area plan, the Post Office can take a view, within its overall urban reinvention planning, on whether a post office branch is needed in that location. I think that that reflects my hon. Friend's hope that the two exercises can be brought together.

Although the review of Gloucester is not due for some months, the Post Office has said that it aims to ensure continued service for the customers of Longlevens. As my hon. Friend said, the branch there was itself suggested as an alternative for customers of the Oxstalls branch, and the company is seeking an alternative partner in the vicinity. In other areas where Tesco decides to remove a post office from one of its stores and there is a need for the service to continue, the Post Office will work to replace the branch nearby. It has given an assurance that in such cases it will not view a decision by Tesco to remove a post office as any kind of blanket opportunity to close branches, over and above those being handled via the proper urban reinvention process.

My hon. Friend talked of the possible threat to Barnwood post office. The Post Office is aware of the planning application for redevelopment of the Barnwood post office site, but I understand that no notice of termination of the contract or resignation of the sub-postmaster has been submitted. It will consider—

The motion having been made after Ten o'clock, and the debate having continued for half an hour, Mr. Speaker adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at half-past Ten o'clock.