Royal Mail and the Post Office

It is a pleasure to serve under your chairmanship this afternoon, Mr. Weir, to discuss a subject that I know is dear to your heart. I applied for the debate after the panel that was set up to review the UK postal services sector published its initial report in response to the evidence submitted to it. I am grateful to Mr. Speaker for granting the debate. I shall first talk about Royal Mail and later address the future of the Post Office. Royal Mail and its universal service obligation are part of the glue that holds the United Kingdom together. The delivery and collection of mail throughout the country at the same affordable price is very important. My constituency is sparsely populated and includes 26 inhabited islands, so it is definitely a beneficiary of the universal service. Small businesses in my constituency could not compete without it. However, the interim report paints a picture of a bleak future for Royal Mail and the universal postal service if changes are not made. Paragraph 79 of the report, which is rightly highlighted in bold, states:"““We believe that there is a broad, emerging consensus among postal companies, business users, consumer organisations and the regulator that the status quo is not tenable: it will not achieve the vision we set out at the beginning of this paper. There is, therefore, a compelling case for action.””" That is a wake-up call to all of us. The report also concludes that householders and small companies have seen no benefit from the opening up of Royal Mail to competition, but that big companies have seen clear benefits. It warns that Royal Mail's financial stability and thus the future of the universal service, with delivery to every home in the country at the same price, is under threat. The report confirms what I and many other hon. Members have been warning for years: continuation of the present policies will inevitably mean the end of the universal service. In recent years, the service has worsened. The first delivery, by which mail used to be delivered by about half-past 9 in the morning, has ended. Delivery times for mail are now much later in the day—in some cases, as late as 7 o'clock in the evening. The price of posting mail has risen steadily. A second-class stamp went up in price by 12.5 per cent. last month, which is well above the rate of inflation. An example from my constituency of a significant worsening of the service relates to deliveries to the island of Mull. For many years, the mail was delivered to the island on the first ferry of the day, at 8 am. Now it is delivered on the second ferry, at 10 am, which has a knock-on effect for the delivery time to people's businesses and homes. Royal Mail's excuse is a European transport directive that restricts its vans to 56 mph. However, that is only 4 mph below the speed limit on Argyll roads, and people familiar with the roads will know that their winding nature and the need to avoid all the potholes means that driving at 60 mph is impossible on most stretches anyway. I am not sure why that 4 mph difference means that mail cannot be on the first ferry. As a result, the mail is not delivered to the shop in Fionnphort, at the end of the Ross of Mull, at the far south-west of the island, until almost 6 o'clock in the evening. Some houses outside the village do not get their mail until about 7 o'clock. Clearly, that is far too late for businesses to deal with the mail that they receive that day, but under Royal Mail's performance statistics, it counts as mail delivered on that day. There is no incentive for the company to deliver the mail earlier in the day—if it is delivered before midnight, it counts as delivery on that day. The Mull and Iona chamber of commerce discussed the problem with Royal Mail, which revealed that three quarters of the mail could reach the first ferry of the day. The chamber of commerce's view was that it would rather receive three quarters of the mail during the working day than all of it after businesses had closed for the night. However, Royal Mail said that it could not entertain that suggestion, apparently because of performance targets. As I explained earlier, the targets set by Postcomm measure the day on which the mail is delivered, in theory even if it is only delivered at one minute to midnight. That raises questions about the performance targets. Royal Mail seems to be driven by those targets rather than by the wishes of the customer. We need to make the organisation a bit more sensible, for example by having a target delivery time of perhaps 3 pm, rather than midnight as at present. We could even have a points system, with full marks for delivery before 3 pm and half marks for delivery between 3 pm and midnight. I always stress to managers delivering any service that the islands need a degree of flexibility. Hard and fast rules that work okay on the mainland do not necessarily apply to islands. It is possible that some people on the island may have a different view from that of the chamber of commerce, so I want Postcomm to consider the proposal that Royal Mail should be allowed to deviate from the normal rules in any part of the country, following a public consultation and with the agreement of the local council. It should be allowed that flexibility as long as there is agreement, rather than slavishly having to follow national performance targets.