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Postal Services Bill [HL]

My Lords, I join other noble Lords in commiseration for the sad death of Lord Dearing. By modern standards, and certainly by the standards of your Lordships’ House, he died at a very early age. His death is a tragedy that we should all mourn. As the noble Lords, Lord Mandelson and Lord Hunt of Wirral, indicated, the Post Office and the Royal Mail undoubtedly have a long-term problem that requires action. I thought that the Minister’s gentle admonition of the noble Lord, Lord Clarke of Hampstead—with his nostalgia for a Post Office and Royal Mail service from Camden to Candleford, which I do not think anyone picked up at the time—was entirely appropriate, because I do not think that even the noble Lord, Lord Clarke of Hampstead, would think that Dorcas Lane would be an appropriate choice to run the modern Royal Mail and Post Office. Both the other parties in this House—not the individuals concerned but the parties—have contributed to the problems facing the Post Office and the Royal Mail. As the noble Lord, Lord Clarke of Hampstead, indicated, it was the previous Tory Government who for many years took the pension holiday that largely led to the pension deficit. He did not attribute blame for that, perhaps because he is looking for the votes of Conservative Members for his amendment. Had the holiday not been taken, the Post Office’s pension problems would be significantly smaller. He also did not refer to the fact that the Treasury clawed back much of the profit that especially the Royal Mail made during those Tory years and did not permit that money to be spent on the modernisation which is now being proposed and is now so essential. So the mistakes of the previous Tory Government were certainly a contributory factor in creating the current situation. Labour’s hands are not entirely clean either. Who knows whether this Bill and these solutions would have been brought forward had the Minister, in his earlier incarnation, remained responsible for the Royal Mail and the Post Office? However, more than 4,000 post offices have closed in the period since he left that position and, notwithstanding the subsidy that the Government are putting into the Post Office network, without the stabilisation that the network requires, that process is continuing. The noble Lord, Lord Clarke, is also correct that the Government failed to provide a regulatory system that protected the Royal Mail from unfair competition after removing its monopoly on delivering letters and parcels. We have now, eventually, got a Bill. The noble Lord, Lord Hunt of Wirral, is correct to ask why it has appeared so late in the day, but we are where we are, and this is a once-in-a-lifetime opportunity to get the structure of the Royal Mail and the Post Office correct. The Bill provides the forum to do that. I agree with the noble Lord, Lord Hunt of Wirral, that this House is at its best when it is dealing with detailed proposals and amendments and trying to get legislation right. The approach of these Benches to the Bill, and our ultimate decision on whether to support it, will not be "shrill", which is a potential admonition from the noble Lord, Lord Mandelson. We will not be shrill, but we do have five tests on which the Government will have to deliver if the Bill is to pass. I think the Secretary of State agrees with the first test—although the devil, as always, will be in the detail. The Bill must guarantee the Post Office’s future as a public sector, public service organisation. It must be separate from the Royal Mail and have its own board of directors and direct access to finance. I think that the Government also agree that the Post Office must remain a wholly public, government-owned enterprise. The Post Office must be given the power to enter into business agreements with other businesses in the mail sector, and I shall give one example. There is no reason why, in the new incarnation, the Post Office could not act as a mini depot for the collection of parcels. The second test from our Benches is that the Bill must deliver the substantial investment which the Post Office network desperately needs to give it a sustainable future. At the moment, the Bill deals only with what will happen to the Royal Mail, but this is an opportunity for the Post Office to be put on a proper financial basis. As I said, although the Minister is correct that significant funding has gone into the Post Office lately, I do not think anyone believes that that has solved the problem. The Government need to set up for the Post Office network an investment fund that will fund branch modernisation, open new branches where gaps exist, provide start-up and investment capital to sub-postmasters and promote the provision of local and central government services by sub-post offices. When the Minister made the Statement before Christmas a number of us on these Benches got the impression that he was going to be innovative in trying to secure the future of the Post Office. We look forward, in the course of the Bill, to proposals from the Government on how to exploit this huge, unexploited retail network throughout the country. One obvious opportunity would be to create a post bank to deliver financial services for all, particularly the financially excluded. The third test, with which I think the Minister agrees—