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Post Office Network — [James Gray in the Chair]

Part of the debate – in Westminster Hall at 9:30 am on 10th March 2020.

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Photo of Marion Fellows Marion Fellows SNP Whip, Shadow SNP Spokesperson (Disabilities) 9:30 am, 10th March 2020

I thank the hon. Lady for her intervention. I totally agree with her. I learnt about the circular flow of income and cash many years ago. If we cannot withdraw money from the post office, we cannot nip next door to the baker’s and buy a bun or a loaf of bread, and the baker cannot use it to pay staff. Things come to a halt. It is basic economics, or economics 101 as it is now referred to.

Communication Workers Union officials have also queried the wisdom of closing Crown post offices—those directly managed by Post Office Ltd—given that the company is profit making. The union notes that franchising causes people to leave the service because jobs advertised by firms such as WH Smith, which holds a very large number of franchises, are lower paid than those at the post office. Last year's decision to turn 74 Crown post offices into franchises in WH Smith stores is also alarming, particularly given reports that franchising is being done without consultation with the existing local post offices, meaning the competition risks destabilising the network further. I believe we heard from Rachael Maskell in a previous debate that that happened in York. The Crown post office was closed, put out to franchise, and opened next to an already franchised smaller post office branch.

There must be more consultation and strategic consideration on franchising. That is a particular concern of the all-party parliamentary group on post offices, whose chair, Gill Furniss, is in the Chamber. Last year, the Post Office’s director of sales and trade marketing stated that it has no contingency plan in the event that WHSmith, which has experienced 14 consecutive years of sales decline, collapses. If WHSmith collapses, what will happen to the Crown post offices? We must ensure that further franchising happens only in consultation with other businesses.

The UK Government must provide more incentives for new postmasters to open post offices that are independent of major chain shops. Will the Minister look at that and instruct Post Office Ltd accordingly? It is appalling that this year the majority of sub-postmasters earned less than the minimum wage for running a post office. The pay increase announced in November will not take place until next month. It is vital that the Minister acts to ensure that profits are not increased at the cost of a cut to postmasters’ pay, forcing permanent post offices to close. Will the Minister take urgent action to review the sub-postmaster contract introduced in 2012? I think I can safely say that it is no longer fit for purpose.

The National Federation of SubPostmasters has raised sub-post office closures with the UK Government and the Government-owned Post Office Ltd. A spokesman said:

“Our records show around two-thirds of closures are due to the resignation of the sub-postmaster”.

The spokesman pointed to low pay as the prime reason, saying that

“This is a particular problem for rural areas in Scotland, as well as across the UK, where people rely on their local post office for vital postal and banking services.”

Last year, an NFSP survey warned that one in five towns could lose its post office in the next year. Surveying a thousand workers found that 22% are planning to close, pass on the business or downsize staff. Sub-postmasters have been forced to go without holidays and take on extra jobs to make ends meet.