Post Office Services: Rural Areas

Business, Energy and Industrial Strategy – in the House of Commons on 11th June 2019.

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Photo of Derek Thomas Derek Thomas Conservative, St Ives

What steps he is taking to ensure that people can access post office services in rural areas.

Photo of Kelly Tolhurst Kelly Tolhurst Parliamentary Under-Secretary (Department for Business, Energy and Industrial Strategy)

The Government absolutely recognise the importance of post offices to rural communities across the UK. There are over 11,500 post offices nationwide, and Government subsidy safeguards post offices, which can be the last shop in the village, so that they can continue to serve their communities. The Post Office delivered almost £10 million of investment via the community fund between 2014 and 2018 to facilitate rural community branches to invest in their retail businesses.

Photo of Derek Thomas Derek Thomas Conservative, St Ives

I thank the Minister for her response but, unfortunately, there is one fewer post office today, as Porthleven post office in west Cornwall closes. Six months ago, the Minister said from the Dispatch Box that, guided by the Post Office, a mobile service will be available in west Cornwall to deal with the nine post offices that have so far closed and are now no longer available. Can she please tell me when we will get that mobile service so that people can once again access post office services?

Photo of Kelly Tolhurst Kelly Tolhurst Parliamentary Under-Secretary (Department for Business, Energy and Industrial Strategy)

I thank my hon. Friend, who has long been a campaigner for post offices in his region. It is true that west Cornwall communities have been unduly inconvenienced, and he is right that the Post Office is now waiting for Cornwall Council to issue a formal permit to formalise the agreement. I have been assured that, due to the closure of Porthleven post office this morning, there will be a weekly mobile service in place very shortly. I just want to highlight that, with such a diverse network in many different locations and settings, it is true that some post offices will close due to unforeseen circumstances and lots of other reasons. It is important that the Post Office keeps up with that challenge to make sure our communities are well served.

Photo of Chris Evans Chris Evans Labour/Co-operative, Islwyn

With banks closing their rural branches, post offices are the last places where people can access cash. However, as I know from the experience of Pontllanfraith in my constituency, it is increasingly difficult to replace postmasters who give up their tenancy. What can the Government do to work with the Post Office to encourage more people to take up postmaster and postmistress jobs?

Photo of Kelly Tolhurst Kelly Tolhurst Parliamentary Under-Secretary (Department for Business, Energy and Industrial Strategy)

I thank the hon. Gentleman for raising that matter. A key part of what the Post Office has done is to renegotiate the banking framework, which has seen remuneration for postmasters increase significantly—it has doubled, and trebled in some cases. On Thursday, I will be hosting a meeting with Post Office Ltd and the National Federation of SubPostmasters, where we are hoping to tackle some of the issues about the economic viability of sub-post offices.

Photo of Daniel Kawczynski Daniel Kawczynski Conservative, Shrewsbury and Atcham

Condover post office in my constituency is a classic example of the very important services that these companies provide to our constituents in rural areas. Now that we are moving towards running a balanced budget, will the Minister work with the Exchequer to ensure that every assistance is provided through the taxation system for these very important post offices?

Photo of Kelly Tolhurst Kelly Tolhurst Parliamentary Under-Secretary (Department for Business, Energy and Industrial Strategy)

My hon. Friend is right: Government have a responsibility to ensure that we work together across Government to ensure that services can be provided through the post office. We must celebrate the fact that the Post Office, for the first time in a number of years, has become profitable. We have the most stable network in decades. Under the last Labour Government, over 7,000 branches shut. We are making sure that we maintain the number of post offices; in fact, we have opened 400 since 2017.

Photo of Tim Farron Tim Farron Liberal Democrat Lords Spokesperson (Communities and Local Government)

One of the silver linings of the decision of the high street banks to abandon our town centres is that post offices are now able to pick up that slack. The Minister said earlier that she was meeting with Post Office Ltd and that the income that postmasters get from banking transactions has trebled. The reality is that they are getting a few pence for every £1,000 of work that they do for the banks, so a trebling is still a pittance. Will she ensure that the banks remunerate our post offices for, basically, doing the work that they have left behind?

Photo of Kelly Tolhurst Kelly Tolhurst Parliamentary Under-Secretary (Department for Business, Energy and Industrial Strategy)

The hon. Gentleman makes a good point about banks moving away from our high streets and the post offices picking up the slack. That is why I am proud of what Post Office Ltd has done in negotiating this new framework. I disagree with him when he says that what postmasters receive is a pittance. In fact, the remuneration has doubled or trebled; it has increased significantly. The Post Office will also be bringing that forward: it will be remunerating postmasters from October, rather than January, when the framework comes into place.

Photo of Gill Furniss Gill Furniss Shadow Minister (Business, Energy and Industrial Strategy) (Steel, Postal Affairs and Consumer Protection)

The new report by a representative group of sub-postmasters notes that a fifth of sub-postmasters are planning to leave the profession, due to increasing financial pressures—indeed we have heard, from different sources, of postmasters earning well below the minimum wage. The result could be the closure of 2,500 branches, threatening the viability and sustainability of the entire network. What discussions has the Minister had with the Post Office to ensure that sub-postmasters are getting a fair deal? Will she urge the Post Office to look at contingency plans to ensure that such closures do not occur?

Photo of Kelly Tolhurst Kelly Tolhurst Parliamentary Under-Secretary (Department for Business, Energy and Industrial Strategy)

It is true that Members across the House care deeply about our Post Office, and so do the Government. The number of branches remains at its most stable for a decade. To give the hon. Lady some reassurance, my meetings on Thursday will include one of the formal meetings held quarterly—with ministerial oversight—between Post Office Ltd and the National Federation of SubPostmasters to tackle some of the key issues.

I reiterate at the Dispatch Box that Post Office Ltd will be undertaking a review of pay, which will report back in the autumn. I agree that any sub-postmaster who wants to take on a post office franchise must be able to do so in the knowledge that it is financially viable. We are supporting them, and the Post Office is supporting them, to serve their communities.