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Postal Services Bill [HL]

Before the noble Lord, Lord Clarke, winds up on his amendment, I have a further question on the role of the European Union in granting permission for the Government to fund the accrued liabilities in the pension fund. I am not at all sure that I understood exactly what the Minister’s reply was on that matter, and I shall tell him why. In 2007, the European Union allowed the Government to subsidise the postal service by £460 million. The theory is that the subsidy was allowed only on condition that 2,500 post offices were closed down. I do not know whether that was absolutely so, but I would like to know whether the Secretary of State knows whether that happened and whether the £460 million subsidy would have been granted had the Government not agreed to close those post offices. I do not know whether we can call it a subsidy, but I understand that the last assessment of the accrued liabilities of the Post Office and Royal Mail was a little more than £5.2 billion, a huge amount of money. If the European Union defines it as a subsidy to the Post Office and the Royal Mail rather than the Government taking over an accrued debt for which they are liable, surely the whole project is in jeopardy. If the European Union says that it is a subsidy and that the Government are merely using a device to get around the EU rules contained in Article 87.1 of the EC Treaty, this Bill cannot go ahead. I am sure that the Secretary of State is knowledgeable about these things. After all, he has been a member of the Commission so he will know even better than I that the Commission takes the question of state subsidy to part-private or private firms very seriously. I hope that he will be able to tell us that the Commission is likely, in his experience, to grant its permission for the Government to take these liabilities, which are well over £5 billion at the present valuation.