Postal Services Bill

Part of Planning (Developer Bonds) – in the House of Commons at 6:39 pm on 27th October 2010.

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Photo of Edward Davey Edward Davey The Parliamentary Under-Secretary of State for Business, Innovation and Skills 6:39 pm, 27th October 2010

Unlike the hon. Gentleman's Government, we do not wish up new pots of money left, right and centre. Of course it is in the BIS settlement.

The Opposition made much of one point tonight. Apart from their ideological contortions over ownership, they have tried to suggest that separating Royal Mail from the Post Office will somehow be the catalyst for post office closures. Let me explain why they are wrong.

First, a privately owned Royal Mail will not act against its own commercial interests. It will not give up valued retail space in the heart of communities the length and breadth of Britain, creating a vacuum that its competitors would gratefully fill. To think otherwise one would have to be living on Planet Consignia. Have Members heard of Planet Consignia? It is where the previous Government once tried to place Royal Mail. Well this Government, along with most people in Britain, understand the value and tradition of royalty, and will not make such daft mistakes.

Secondly, Royal Mail has made it clear that the current long-term commercial contract between Royal Mail and post offices will continue. Only this week, the chief executive of Royal Mail, Moya Greene, told me that

"the support that the Government is giving to Post Offices Ltd should mean that the Post Office should become an even stronger retail channel for Royal Mail."

She went on to say that it was "unthinkable" that there would not be a strong relationship between the Post Office and Royal Mail in the future.

Thirdly, if the Opposition are seriously saying the Government should write into the Bill that there should be a statutory permanent contractual relationship between Royal Mail and the Post Office, they would be risking not only a legal challenge from competitors, but setting the Post Office in aspic. Do they not realise that as Royal Mail's letter volumes decline, so too will the mail business for the Post Office, so it needs to be given the opportunity to build new revenues? Do they not realise that new sources of revenue will be critical if we are to achieve a financially viable post office network?

I have a confession. I am a postal anorak. Before having the honour of being elected to the House in 1997, I was a management consultant and I specialised in postal companies. I worked on projects for Royal Mail's equivalents in Taiwan, South Africa, Belgium and Sweden. Although I co-authored a report for the US Postal Service to put to Congress on the commercialisation and liberalisation of postal companies and markets around the world, I have to disappoint Gregg McClymont; I never worked on a privatisation programme- [ Interruption. ] Regrettably. Back then, in 1997- [ Interruption. ]