Post Offices (Closure)
The final item of business is a members' business debate on motion S2M-3735, in the name of Dr Elaine Murray, on the closure of six post offices. The debate will be concluded without any question being put.
Motion debated,
That the Parliament expresses its concern over Post Office Ltd's announcement that it will be closing six town centre post offices, including the main post office in Dumfries, replacing them with franchises in SPAR shops; notes that SPAR itself is a franchise; is concerned over the implications for staff numbers and terms and conditions of employment; believes that in cases such as Dumfries the new location is less convenient for customers; further believes that the proposed arrangements may not offer a sustainable and long-term future for these post offices; expresses concern that the announcement was made less than two weeks before Christmas and considers that Post Office Ltd should extend the consultation period beyond the current seven weeks to ensure that all customers get the opportunity to express their views, and believes that no irreversible decisions should be made without paying full consideration and attention to the views of customers and staff.
Thank you very much, Presiding Officer. I also thank the members of all parties who signed the motion, thus enabling the debate to take place.
On 13 December, less than two weeks before Christmas and during one of the busiest weeks of the year for counter staff, Post Office Ltd—a company that is wholly owned by the Royal Mail Group—announced the closure of a further six town centre Crown post offices and the transfer of their functions to private sector franchises. Those post offices are in my constituency, in Dumfries, and in Perth, Bathgate, Dunfermline, Coatbridge and Hope Street.
The Post Office Ltd press release of 13 December stated that there would be a seven-week consultation period on the proposals. However, subsequent meetings and communications with the Post Office's spokespeople have indicated that a deal has already been struck with CJ Lang & Son Ltd, and, in the case of Dumfries, with Malhotra & Partners Ltd, with the support of CJ Lang & Son Ltd. Management met staff and their trade union representatives the following Monday—I am pleased to see that members of the Communication Workers Union are in the gallery—and staff were then told that they had two weeks in which to decide whether they wanted to take voluntary redundancy terms or to transfer elsewhere in the Royal Mail Group. Last week, the new posts in the Spar franchises were advertised in the local job centres. That is not what I understand by the word "consultation".
There is massive public opposition to the proposals in my constituency, and since 14 December, I have been running a petition that calls for a rethink. Despite the Christmas holiday period, there are already more than 4,500 signatures on that petition.
I am pleased to welcome members of Dumfries and Galloway Council, including its chief executive and convener, who are here for the south of Scotland alliance reception later this evening. The council has expressed grave reservations about the effect of the proposals on its town centre regeneration proposals. It has offered to take over the shop; indeed, it could even help to run the post office from its own premises. However, for reasons that I do not understand, the council has been told that a conflict of interests would be involved in its doing that. It has therefore offered to help Post Office Ltd to find more suitable premises that are nearer to the centre of the town.
The Crown post office is currently located at the main local bus service interchange in the town centre. Post Office Ltd has said that the new location will be 300m away, but the distance as the pedestrian walks rather than as the crow flies is more like 500m and it includes a steep descent down Bank Street from the High Street. The location would be far less convenient for older and disabled people, who make up a significant proportion of the post office's customers. Indeed, after the announcement, I observed a disabled man in a wheelchair attempting to get up Bank Street. If it had not been for a friend of his who ran out of the bookies to help him, he would not have been able to make it up the street. A 70-year-old constituent of mine whose wife is disabled told me that there are 17 car parking spaces for disabled people in the vicinity of the current site, but there would be only two spaces within 200m of the new site. The location is not good for the service.
We have been told that a full range of post office services will be protected, but I cannot see how that can happen. At the moment, the Dumfries post office employs 14 staff, but the new adverts are for only six staff, only two of whom will be full time. The other posts are part-time posts. So far, the maximum number of hours that have been advertised at any of the new locations is only 122 hours per week—there will be fewer hours at some locations. As far as I can see, that will mean that there will be fewer counters and longer queues for customers. Furthermore, all the posts except for the post office manager's post are advertised as paying only 30p an hour above the minimum wage. The manager will be offered the princely sum of £16,000 a year for a 42-hour week. Those amounts do not compare with the wages that post office staff currently receive—they do not even compare terribly well with the wages that other retailers offer. My daughter's 18-year-old friend who works for Tesco earns more than that. The experienced and dedicated staff who currently work for the Post Office will not work for such wages. I cannot believe that the same service that the general post office currently offers will be on offer.
We know that Post Office Ltd has financial problems and that the transfers are being undertaken to cut down on staff costs. However, the current proposals do not stand up to scrutiny on that basis. Post Office Ltd has told us that nobody will be made compulsorily redundant and that everybody will be able to take voluntary redundancy terms or to transfer elsewhere in the Royal Mail Group. The nearest Crown post offices to Dumfries are in Ayr and Carlisle, which are 60 miles and 35 miles away respectively. Even if staff could travel those distances, they would have to rely on people at those post offices wanting to take voluntary redundancy terms in order to obtain employment. It is unlikely that 14 people would do so. If staff transfer elsewhere in the Royal Mail Group, it will not make the savings that it needs to make. If the process continues, a point must come at which it must be recognised that people will have to be made compulsorily redundant. In those circumstances, staff should receive compulsory rather than voluntary redundancy terms.
I am not confident that, in the light of its actions so far, Post Office Ltd will reverse its decision, but I urge my constituents to write to Andy Bayfield of Post Office Ltd and to copy their representations to Postwatch Scotland. I ask people to stress the total unsuitability of the proposals for Dumfries and the effect on the post office's business if it moves to the new location. Many of my constituents have told me that they are unlikely to transfer their business if there is a new location. They are likely to use the high street banks and their own local branches.
We saw something similar happening about a year ago when Safeway was taken over by Morrisons and the in-store post office was closed. At that time, we were told that the Dumfries town centre post office was safe—but it was not. We were told recently that only 15 per cent of the in-store business had transferred from Morrisons to the new Crown post office. What if that happens again? What happens if the business does not transfer from Great King Street—its current location—to the new office in Whitesands? It is quite possible that the footfall that underlies the business plan that Spar has put together just will not happen because people will not go there. Then what happens? We have been told that CJ Lang is tied in for five years, after which it has to give 12 months' notice, but how can the small business franchisee who operates the store do that? He might be bankrupt by then.
Post Office Ltd, the Royal Mail Group and the Department of Trade and Industry, which owns the shares, need to reflect on whether the Post Office offers a public service or whether it is just a business. If the Post Office is no longer to be a public service, it cannot count on the loyalty and affection of the public as it does at the moment.
Since the 1980s, there has been a long-term programme of conversions and closures of post offices, and only 42 remain in Scotland. To those 42 locations that still have a GPO, I say this is coming shortly—just wait. It is coming to a post office near you, too.
I congratulate Elaine Murray on securing the debate. The number of members who are in the chamber reflects the shock and incredulity many of us experienced when we heard the announcement. I will be brief, as many members want to speak. Most of us will rehearse much the same arguments.
We all accept the need for efficiency in the commercial operation of the Post Office, which faces competition from within and outwith the United Kingdom. However, it is a logic that the Government does not always fully accept, as it does not give the Post Office full commercial freedom. Only last week, we read in the newspapers that funding for some mechanisation improvements in the Royal Mail's main sorting office was being held up by the dead hand of the Treasury. The truth is that the Post Office and the Royal Mail can never be fully free from political influence—as witness this debate, which is part of that political influence. The Royal Mail has a public service obligation, and even for those of us who are not royalists that means at least that it is a public or state service. We owe it some consideration and it owes us and its customers some consideration.
The Post Office has a major commercial advantage in its name, its reputation, its labour force, its network and its high street presence. I suggest that those advantages are not immutable: they could be lost. It is commercial folly for a brand leader potentially to give up its high street presence, which, once lost, will not be regained. That is certainly the case in the changes that are proposed in Dumfries. Elaine Murray mentioned the fact that all the branches in the former Safeway stores were lost when Safeway sold out to Morrisons. There is no guarantee that the contract that is being sought with Spar will continue in perpetuity. If that contract falls, the post offices will not return to our high streets.
As Elaine Murray said, it is a public relations disaster in terms of staff and contractual dealings for the Royal Mail to act in advance of the consultation as if all is done and dusted. It is an insult to all involved—staff, the public and us in this chamber. I urge the Post Office to heed the motion and what is said in the debate. I urge it to heed the results of the public consultation, the strength of which may surprise it. I also urge it to distinguish carefully between the inevitable protests that accompany any change in the public arena at any time and the deep concerns that have prompted this debate.
The subject that we are debating is important, although, regrettably, it is a reserved issue and we do not have political control of the Post Office.
Elaine Murray set out very well the arguments that relate to Dumfries. As I understand it, the effect of the closure of some post offices will not be so severe as it is in Dumfries, but each case has to be considered separately.
The debate raises two major issues. First, whether from a Scottish perspective or a United Kingdom perspective, we must get our policy on the Post Office much clearer. Is it a public service or is it merely another way of making money? There is no clear public policy on the issue. We should talk to our colleagues at Westminster and try to establish a clearer line on what the Post Office is supposed to deliver. I am sure that we all support it in diversifying and providing new services, but we have to get our act together on policy.
Secondly, the problem with our profession is that when an issue such as this comes up, we get documents from the large body—in this case the Post Office—that is doing things some people dislike. The documents say that everything will be marvellous, that no one will lose their job, that no one will be inconvenienced and that the sun will still shine. We then receive other documents from user groups or trade unions that set out their view of how bad the whole thing is. It is possible that, just as one side overstates how good the situation is, the other side overstates how bad it is. How do we sort that out?
One good aspect of this Parliament is the Public Petitions Committee. I wonder whether we could have another committee that considers this type of situation and tries to establish the truth. If the anti side is grossly exaggerating its argument, we should tell it that it has it wrong; if the defensive management is overstating the benefits of a scheme, we could make some points against that, too. I might have spent some years as a school teacher, but I believe that we should try to establish some discipline in the information we are given.
In this case, I can tell from the documents that I have been reading that one side or the other is telling porkies. I would be interested to know which it is. I suggest that we consider our procedures, because the issue is very important. As I said, how acceptable or unacceptable closure is will be different for each individual post office, but I am very glad that we are debating the point.
I congratulate Elaine Murray on securing this evening's debate. It is significant that there are so many members in the chamber. Like most others, I agree with the sentiments in Elaine Murray's motion.
What is most concerning about the proposal for the six post offices is that they are not tiny, out-of-the-way post offices or sub-post offices—they are town centre post offices that we thought would always be there. Most members in West Lothian—and in Dumfries—believed that the post office review was complete in their local area, but then, out of the blue, this proposal landed on their desks.
I wonder whether the Bathgate post office is being proposed because it is owned by the Post Office, it is a large area of land and the Post Office thinks it might just be good for housing. I hope not, because that it not what Bathgate needs; what Bathgate needs is a post office.
There is great support from local people for the status quo. Older people have confidence in the post office and can be seen there daily, using it to pick up their pension; many young people still have their first savings account at the post office; and us in-betweenies still pick up our child benefit regularly at the post office. I even managed—I have it here with me to prove it—to get a post office card so that I can do just that. It was not easy.
Most members will have received from the Post Office the letter that explains the proposals and the equally telling e-mail, which we received today, that responds to the briefing that we received from the Communication Workers Union last week. Today's e-mail tried too hard, I found, to justify the proposals.
In the letter, we were told that five of the six post offices would become part of the retail shops of CJ Lang. However, I understand that CJ Lang made that approach to Post Office Ltd and that such an arrangement was not in the original proposal. I am concerned that the proposal is more about bolstering CJ Lang's Spar businesses than about my constituents or even the post offices.
Others have mentioned concerns about Spar's future commercial viability. I am also concerned that the proposals will not, as we have been told, ensure a financially viable future for the post offices. In my area, people have said that they will not queue in the rain, which they will need to do if the post office moves to the small Spar shop. I am concerned that the level of business will fall and that the change could turn out to be just a stepping stone to complete closure, which would leave constituents with no post office service.
We have been told that there will be no compulsory redundancy, but that seems to be just a play on words. As we have heard, many workers would find it impossible to transfer to another post office because there is no other post office nearby. Especially for women who have other, caring, responsibilities, such a move would not be feasible.
The proposed new post office for Bathgate will have only six counters, whereas the present one has eight. That is not an improvement, but a reduction in service. Like my Westminster colleague, Michael Connarty MP, I believe that the post office is not just a business but a service. Although it must be efficient, profit should not be the only influence. Does the Post Office realise that the constant reviews and threats of job losses undermine staff morale?
Finally, I hope that the Post Office will listen to the consultation responses, which in my area—as, I hear, in other areas—have been overwhelmingly against the proposals. The people of Bathgate clearly do not want this change. The Post Office has convinced no one. I hope that it is listening.
I join others in congratulating Elaine Murray on obtaining this evening's debate. The issue may be a reserved matter but it affects a number of people in the east of my constituency who use the post office in Dumfries.
The loss of any major asset from the centre of a community is always hard to bear. One need only look at any small rural village that has lost its school, shop, church, post office or even its pub—some villages have lost all those things—to see the devastating impact that such a loss can have.
Only last night, I attended a public meeting in the Haugh of Urr, which is one of three communities in the Castle Douglas area that are taking part in a pilot scheme for a new form of postal service delivery in small rural communities. No one who was present at that meeting—some of whom are in the public gallery this evening—will or can doubt the depth of feeling in that community, whether or not they agree with that feeling.
One lesson from that pilot scheme is that Post Office Ltd has a long way to go before it can be said to be promoting communication, consultation and inclusiveness in undertaking the efficiency programme that was set by the UK Government at Westminster. We should be under no illusion about the fact that the actions of Post Office Ltd are a direct consequence of Government policy. It is for the Government to decide whether the Post Office is a service or a business.
I have no difficulty with the concept of an efficiently run Post Office. Unlike, I suspect, some members, I have little difficulty with the principle that the Post Office might in effect franchise out service delivery, notwithstanding the serious staff issues to which Elaine Murray referred. That model appears to have been fairly successful, at least in economic terms, where it has been carried out. But I have considerable difficulty when the transition from a directly managed post office, such as that in Great King Street in Dumfries, to a Spar franchise retail outlet is presented as more or less a fait accompli.
I also have difficulty with the accompanying consultation exercise, which has little to do with consultation and a great deal to do with information. This is exactly what happened at the beginning of the rural scheme I mentioned, which I believe would have been much better received by the local community if there had been genuine consultation, openness and inclusiveness on the part of Post Office Ltd. I am sorry that lessons appear not to have been learned in relation to the exercise in Dumfries.
The closure of the Great King Street branch would be all the more poignant as it is one of a tiny handful of UK post offices that has been awarded and bears the charter mark. Although the branch wears the badge with great distinction, it will be lost for ever in any transfer.
I understand that the change in Dunfermline would involve a Spar shop moving into the existing post office. I am not convinced that that model has been fully explored with regard to the post office in Dumfries, where I imagine transferring the sorting office would provide ample space for a popular retail outlet in the very centre of the town.
Last week, when I and our former colleague David Mundell met Royal Mail officials, I was heartened to hear one official highlight Post Office Ltd's commitment to maintain a strong presence on the high street. I thought that that was excellent, but it stands in direct relation to the proposal for Dumfries. Frankly, anyone who thinks that Whitesands is the high street of Dumfries knows neither the town nor the area. Whitesands is not and has never been the high street, and putting the post office into the Spar there will not make it so. In summary, I am happy with the principle, but I am deeply unhappy with the proposed location.
I note with considerable interest that—here I quote rather reluctantly from The Guardian—
"The new boss of Britain's post office network",
Mr Alan Cook,
"expects a showdown within months … with ministers over the future of rural branches, many of which would shut if the government makes cuts to its £150m subsidy."
I hope that he has that showdown and that he is successful. Rural Scotland and its communities need their post offices, and I do not see how they can be maintained without some level of public financial input.
I very much support Elaine Murray's motion and congratulate her on securing the debate. I trust that Post Office Ltd will not totally close its mind to other alternatives in Dumfries until all possibilities have been thoroughly and fully explored.
I congratulate Elaine Murray on securing the debate and I congratulate her and the Dumfries & Galloway Standard on their campaign to save the post office in Dumfries. Their excellent work must be noted.
In her speech, Elaine Murray clearly set out the details of the Post Office's sham consultation, which was the sort of consultation that brings every consultation into bad repute. It is clear that the Post Office's actions over the past six weeks in no sense match what we understand by the word "consultation". Postwatch Scotland has called for full consultation on the closures, but that has not happened. We need time to mount a consultation, to research the possibilities and to find out what the requirements are, so the Greens call for a full year's reprieve for the post offices to allow for proper consultation, to consider the alternatives and to find ways of keeping Dumfries's general post office open.
Staff say that the Dumfries post office has made a profit every year for the past 10 years. We want to examine the figures and to find out how the Post Office can possibly have built a case for closing that post office. Moreover, the Post Office is a publicly accountable organisation that should provide services in the public's interest. However, although it still has a public service obligation, its decision shows that it has no intention of honouring it. I realise that the issue is reserved, but I do not have much confidence in the UK Government's ability to persuade the Post Office to live up to its public service obligation and to keep the post offices open. We need look only at the company's track record: when Royal Mail decided, against Government policy, to move its operation from rail to road, the Government could do absolutely nothing to stop it.
The closures are opposed by the Communication Workers Union, Age Concern Scotland, Capability Scotland and the National Pensioners Convention. Surely the weight of all those opinions must be taken on board. Age Concern Scotland says that the proposed changes will not benefit the community, but instead are likely to cause significant problems for older people. Capability Scotland is concerned that the closures will hit disabled people particularly hard. The National Pensioners Convention has run a series of demonstrations across the UK to draw attention to the effects of post office closures. A post office is more than just a series of commercial services; it is a hub for the community and a source of information, and there is no evidence whatever that, under the harsh realities of commercialism, the facilities that are provided by the post offices will be kept.
The Post Office promised us in 1999 "A World Class Service for the 21st Century". Through the closure of a number of main post offices throughout Scotland and the threat to rural deliveries—something that is not covered in the motion, but which goes alongside the threat of closure—that promise is not being kept. In fact, we are going back to a service that will be worse than the service in the 19th century. Customers in Dumfries deserve much better than that, so I congratulate Elaine Murray on her motion and on the campaign.
I am pleased that we have the opportunity to discuss an issue that is of great importance to our constituents. Post Office Ltd should be aware of the strength of feeling that exists, not just among pensioners and other people who use post offices day to day, but among traders. I have received a great deal of correspondence from business customers of Post Office Ltd who are deeply concerned about the implications of the changes for the economic viability of Bathgate.
I am pleased that we have the opportunity to discuss the issue, but there is a certain air of unreality about the debate. People reap what they sow, and we are now seeing the consequences of decisions that were made by Westminster Governments about Post Office Ltd. This is not the first debate on post offices in which I have spoken; I led a debate in 2000 in which the SNP raised the issue of the UK Government's benefits policy and its consequences. At that time, there were proposals for the rationalisation—otherwise known as closure—of post offices in urban areas with populations of fewer than 10,000.
That is not what is happening here, but I would like to quote what Henry McLeish, who was the responsible minister at the time, said during that debate. He said:
"we have a Government that is building into a bill at Westminster obligations on the post authorities to ensure that there is an effective, viable network. It may be that in some areas the post office is not commercially viable, but is a social necessity. That is the issue that should unite us today. No one would argue against the proposition that we should have an effective network."—[Official Report, 8 March 2000; Vol 5, c 486.]
The issue that we are debating now is the movement of post office services into the Spar franchise and whether that will provide an effective network in the future. On a variety of levels, that is certainly open to question. The social inclusion agenda is devolved, which is why we have debated post offices in the past, and why it is an area about which we should have concerns. The idea of pensioners queuing outside in the rain because of the size of the Spar shop in Bathgate is a concern as far as social inclusion, dignity and respect for our pensioners are concerned. That is something that we must consider.
There is also a point about the future viability of post office services, as we have seen in Carmondean in Livingston and elsewhere. When Wm Morrison Supermarkets plc took over Safeway, there were questions about the viability of there being an effective network in the future. Henry McLeish was right to say in 2000 that we had to consider whether the Westminster Government would help to guarantee an effective network, but we are now seeing the results, and the question must be whether there is an effective network. Elaine Murray is right to stand up for her constituents, and Mary Mulligan was right to talk about the Bathgate situation, but people reap what they sow. That must be fully acknowledged.
Post Office Ltd should reconsider the proposals. From a commercial point of view, it should listen to the concerns of small traders and businesspeople about the implications of the proposals for a market town such as Bathgate. It is not a small village; it is a town. It is struggling, but it has a potentially viable future, and its post office is part of that.
The briefing from Post Office Ltd states that there are to be no post office closures. I am sorry, but that is just what it is doing. It is closing the post office in Bathgate and providing its services elsewhere, but there will not be a post office—there will be a Spar shop with a post service in it.
Post Office Ltd also went on to say that although the decision to transfer the management to CJ Lang & Son Ltd is not itself subject to formal consultation, it wants to understand how the planned changes will affect its customers and is keen to seek feedback. How kind—the decision is not subject to consultation. I know that in Bathgate the work to remove refrigerators and create space is already happening. That is wrong. From a public relations point of view, it is an abuse of the public's trust of Post Office Ltd and the benefits that it gets from its title; it is seen as a public service and it benefits from that. People think that the decision is open to consultation, but the briefing shows clearly that it is not. I welcome the debate, but let us be realistic about what is happening and why it is happening.
It is with double sadness that I rise to speak in the debate. I am sad because one of the post offices that is referred to in Elaine Murray's motion lies in my constituency in Queen Anne Street in Dunfermline. I am also sad because opposition to the closure and reduction of post office services was a campaign that my recently deceased colleague Rachel Squire MP was heavily involved with in our constituency. I know what Rachel would have done at Westminster. I am glad to have the opportunity to speak about our Crown post office in Dunfermline in tonight's debate and I thank Elaine Murray for giving me the opportunity.
Alex Fergusson was right to highlight that the situation in Dunfermline is slightly different from that of some other post offices. What is being proposed in Dunfermline is that the Spar shop will come into what is currently the Crown post office. However, the concern of people in Dunfermline—I am sure that Bruce Crawford will talk about this—is that the service that will be available in the new post office will obviously be vastly reduced.
Elaine Murray was right to highlight the impact that the proposal will have on current staff. They have no choice. The nearest Crown post office to Dunfermline after the proposal is carried out will be in Glenrothes, because the Crown post office in Kirkcaldy was closed 12 years ago; its business was transferred and the former Crown post office is now a pub. Staff do not have a realistic option to transfer anywhere else, but what they are perhaps being offered is their old jobs at half their current pay rate. That is a serious issue.
The reduction in staff numbers is also serious. It is proposed that the number of counters in the Dunfermline post office be reduced from the current 14 to eight. That will almost halve the possible service. People who know the Queen Anne Street post office in Dunfermline will know about the queues that already exist with the number of counters that are there. It is only two years since the sub-post offices at Baldridgeburn, Reid Street and Townhill Road in Dunfermline were closed. The main reason why those stand-alone sub-post offices were closed was they were within a mile-and-a-half radius of the main Crown post office. Given that the three sub-post offices were in existence up until two years ago, the reduction in the service that is available at the Crown post office means that there will be a massive reduction in the service that Post Office Ltd is offering to people who, like myself, live in the centre of Dunfermline.
We must be very careful about saying that we can never have any change, but we should not have change at any cost. I cannot talk about the other post offices, but I have heard what other members have said. We need to be clear that the service that will be available will be reduced—it will certainly be reduced in Dunfermline. We must be clear that that is not only a public relations disaster for Post Office Ltd. If it was just a PR disaster, we could all accept that; however, it is a disaster for people who rely on the services that post offices provide. A reduction in the number of counters and the number of post offices will mean that people who regularly use post offices and rely on their services will get a much reduced service and will end up paying for the changes.
I congratulate Elaine Murray on bringing the debate to the chamber, as it is important that we discuss the matter.
Scott Barrie made some important points. The consultation process was not satisfactory; it should have been done with more care and consideration. However, no matter how much consultation there is, there will be genuine concerns about the impact of the post office closures on the salary and terms and conditions of service for many staff. As Scott Barrie said, the position in Dunfermline is different from that in Dumfries, as the post office and the future Spar shop will remain in the same place. That does not, of course, remove the anxiety or concerns of staff. Despite the offer of voluntary redundancies or relocation, the closest place to Dunfermline is Glenrothes, as Scott Barrie pointed out. Many staff will want to remain with Royal Mail—although, looking at how the matter has been handled, one might wonder why. The Post Office must, as other members said, look very closely at what the motion says and at the number of members who have signed up to it.
On the issue of service, the briefing that we got from the Post Office says that the new branches will also offer customers a high-quality grocery store, as the branches will carry a range of shopping under one roof, and that in some branches the change may also mean longer opening hours on Saturdays. If my understanding is right, that will not affect Dunfermline, because it already opens on Saturdays. We need to enter into serious discussion with the Post Office about what it considers to be the improvements in real terms. As Scott Barrie said, there could be a reduction from 14 counters to eight in the post office in Dunfermline.
Leaving aside for a moment the issues of staffing—although that is by no means to diminish it—and service, it is important to ask ourselves honestly how we reached this position. For better or worse, the changes that have been made at Westminster to how benefits and pensions are paid have had a severe impact on the financial viability of post offices. Indeed, the Communication Workers Union has been led to say that the changes in how benefits and pensions are paid have had severe financial implications for the Post Office.
There is a dispute between the union and the Post Office about the scale of the financial implications. On the one hand, the union says that there has been a loss of £71 million across the whole group; the Post Office, however, claims that the loss is only £71 million across the directly managed units. No matter how we look at it, the Post Office is making a severe financial loss, and it is being told by Government that it must address that loss. It is taking action as required by the Westminster Government. Are Labour members saying that they are distancing themselves from the decisions taken at Westminster? Those decisions have led to the closures that we are debating.
While recognising the difficulties, we must be honest with ourselves. Fiona Hyslop hit the nail on the head when she said that we reap what we sow. We can protest about what is happening and about how staff are being treated and ask whether the service will be better. However, should we not also be protesting about the process that allowed us to reach this position in the first place?
I, too, congratulate Elaine Murray on securing the debate. It has been pointed out that postal services are a reserved issue, so I wish to start by recognising the work that my Westminster colleague, Tom Clarke, has done in raising with the Post Office the concerns of the people of Coatbridge.
The main post office in my constituency is set to be franchised as part of the proposed changes. Under the proposals, the central post office in Coatbridge will remain at its present location on Main Street. It will be owned by the Post Office but will be operated by CJ Lang & Son as a combined post office and Spar shop. As with other post office closures, staff have been offered voluntary redundancy packages or the opportunity of alternative employment. That means that CJ Lang will be recruiting an entirely new staff for the branch with, as Elaine Murray and Scott Barrie pointed out, less pay and benefits than those enjoyed by the highly trained and experienced staff in the Coatbridge post office.
Current post office staff who want to remain in their jobs and who do not want to transfer or relocate because they have childcare issues, for example, will have to take voluntary redundancy and apply for their own job for less pay—if they are appointed. That is extremely concerning. Despite the Post Office's assurances that it will continue to train staff and monitor the levels of service that are provided in stores, I believe that a drop in conditions for staff will ultimately result in a drop in levels of service. That is unacceptable.
Coatbridge post office is a standalone main branch that has an average of between 6,000 and 7,000 customers in a town of 45,000 people. That means that a significant proportion of the population access the branch every week. The recent closure of sub-post offices in the area has increased demand for the services that the main office provides. Scott Barrie mentioned that the same situation applies in Dunfermline. Frankly, it is outrageous to suggest replacing the Coatbridge branch with a shop.
Given the small amount of retail space that will be made available as part of the proposed plans, I do not see how CJ Lang can provide adequate retail opportunity on the site to turn around the losses that the Post Office has identified. That leads me to another concern. My initial instinct was that the most commercial option for CJ Lang in the limited retail space that will be provided in Coatbridge might be an off-licence. It would appear that my instinct was correct because the future proprietor has applied to North Lanarkshire Council for a licence to sell alcohol. It did so on 8 December, four days before the franchise announcement was made and the consultation began.
It is of grave concern to me that the main post office in Coatbridge—a town that is all too familiar with the detrimental effects of deprivation and alcohol abuse—might end up containing an off-licence in the same premises in which benefits are paid out. If I was cynical, I might think that the proposal was designed to exploit vulnerable people. Frankly, I am horrified at what has been suggested.
Given that a franchise has already been agreed with a commercial partner and—in the case of Coatbridge—that a licence to sell alcohol was applied for before the consultation started, it would appear that the transfers will go ahead regardless and that the so-called consultation is merely a token gesture or some kind of half-baked public relations exercise on behalf of Post Office Ltd.
The situation is indicative of the wider privatisation agenda, under which profits are put before public service and people. I say to Bruce Crawford that there are implications not just for Westminster, but for the European Union. The further removed from public ownership post offices become, the less control we will have over the services that they provide and the ethos that has driven the postal service for generations. The result of that is that commercial considerations will take precedence over societal needs and priorities. A clear example of that is the proposal to put an off-licence in the main post office in Coatbridge, which is outrageous. I am happy to support Elaine Murray's motion.
I thank Elaine Murray for securing the debate.
The Post Office is a national institution in Scotland. It was 97 years ago, in 1909, that the first old-age pension payments were made in post offices all over the country.
Unfortunately, central Government has coldly and cynically done a Ratners on the Post Office. The Post Office is a great institution that should never have been subjected to such treatment from any central Government. It is even more disquieting to know that it is a Labour Government that has carried through the proposals that we are discussing.
Most of the points that I would have made have already been made. All that I can say is that the Royal Mail will be next—members should watch out for the vultures cherry picking its services. Postal services in rural Scotland and other non-profitable areas will be thrown to the wolves, just as our tremendous Post Office institution is being thrown to the wolves by uncaring politicians.
As other members have done, I begin by congratulating Elaine Murray on securing the debate. Her motion is on a fairly emotive subject, in that it focuses on the closure of post offices. As a constituency member, I am acutely aware of a number of the issues that other members have raised. I hope that the one thing that all of us across the parties would agree on is that post offices are an extremely important and integral part of any community.
Donald Gorrie was one of the members who referred to the Post Office Ltd briefing paper that most if not all members will be in possession of. It briefs members on the reasons for the changes to the post offices at Bathgate, Coatbridge, Dunfermline, Perth, Hope Street in Glasgow and, of course, Dumfries, which is the post office that Elaine Murray understandably has a particular interest in, as the constituency member.
I am not sure whether, as Maureen Macmillan suggested, it is possible to try too hard. It was an unfair criticism of Post Office Ltd to say that it has tried too hard to address community and other concerns. Clearly, the paper is an attempt to challenge the assertion that the changes represent closure per se—as I am sure members agree, language is important in these matters. A number of members spoke about the impact and effect on those who are employed in existing post office premises. I have a great deal of sympathy with them on that point, as I do on the issue of service delivery, which a number of members also raised. From my dealings with Post Office Ltd and the Royal Mail Group, I know that the views that have been expressed today will be considered carefully. Before coming to a final view on the matter, they will take on board a number of the points of detail that have been raised.
In that context, I will address briefly some of the other issues that were raised in the debate. An important part of the process, as I think Bruce Crawford and other members said, is that the Parliament gets the opportunity to ensure that possible loss of service is discussed. That is an important role for the Parliament. I am also aware of the possible effect on existing post office staff. We have to have an understanding of why Post Office Ltd proposes to make these changes.
A number of members asked what the precise position is of the post office in a contemporary context—whether it is a public service or a business. The United Kingdom Government has asked Post Office Ltd to operate commercially; critically, it has been asked to do so while also understanding social needs. I do not think that the two objectives are mutually incompatible, although members may take a different philosophical point of view on the matter. Post Office Ltd is a commercially-run company, albeit with the UK Treasury as its sole shareholder. Our scope for intervention is therefore limited. I think that that is widely appreciated across the chamber.
Although Post Office Ltd is a commercially run company, I am curious to know whether its own post offices sell alcohol or act as off-licences and whether the minister thinks that it is acceptable for the post office in Coatbridge to do so.
The member made an important and incisive point. She is knowledgeable about the community that she represents. However, it is not for me to defend—or otherwise—the social conscience of Post Office Ltd or the franchise proposition; it is for Post Office Ltd to do that. Some 96 per cent of post office branches are already managed successfully in partnership with individual sub-postmasters or retail companies. I do not know the figures off the top of my head, but I suspect that some—although not all—of them may well engage in the sale of alcohol. It may or may not be appropriate for the post office in Coatbridge to follow suit.
We know that Post Office Ltd has been trying, over the past few years, to turn its business around. Following significant losses in the early 1990s, the business has made much progress. Along with other changes, the introduction of new products such as loans, car insurance, credit cards and a bureau de change service have helped to stop the business sliding deeper into the red. That is important because, notwithstanding the welcome successes, the business's half-year results in November showed a loss of £57 million, compared with a loss of £110 million in the most recent full financial year. All these measures are a part of remedial actions that the company is taking to address those losses.
You have one minute.
I must crave your indulgence, Presiding Officer. The debate is important and involves many important issues. I am sure that members would not mind if I addressed those issues.
A major part of the losses centred on the directly managed network, which is made up of more than 500 branches throughout the UK, 49 of which are in Scotland. It is important that we take on board the Scottish context. The directly managed network accounts for only 4 per cent of Post Office Ltd's operations.
The problem with which some of us are wrestling is how post offices with eight or 14 counters and a perpetual queue continue to lose money. What is the alternative? If a business's customers are always queuing for more of whatever it provides and it still cannot make money, how can that be turned around? What is the answer?
In part, I suppose that the commercial response would refer to franchising, because it increases the footfall, as Elaine Murray and others have said. Standalone branches such as those that exist in the areas that have been mentioned find it extremely difficult to make a profit to survive—that is the commercial reality. The gist of Post Office Ltd's argument is that those branches will close if action is not taken. If that happened, the potential worst-case scenario involves job losses and no post office service for those who live in the communities concerned. That is the other side of the coin. It is important that the Parliament has a balanced perspective on the issue.
I am not an apologist for Post Office Ltd, but, for the reasons that Bruce Crawford and other members outlined in relation to the social dimension, the Scottish ministers work closely with Post Office Ltd, the Royal Mail Group and others as part of a partnership agreement to ensure recognition of the importance of the availability throughout Scotland of the services that the post office network provides and to ensure that the sort of issues that members have raised are addressed. Post Office Ltd tells us, after 15 years of experience in franchising, that branches that are located in premises of businesses such as CJ Lang—which I understand is a reputable family-owned business—have a greater chance of success and survival than standalone branches have. Post Office Ltd says that, by working with franchise partners such as CJ Lang, it will be able to continue to provide a full range of services, possibly with daily and Saturday opening, to which Bruce Crawford referred. There will be a potential benefit from the shared footfall of customers and from a customer base that would not normally use the post office.
It is worth expressing that argument, as it is the nub of Post Office Ltd's case. It is not necessarily for me to pick holes in that argument, but others may do so. To get to the crux of the issue, members have argued with feeling that the changes might result in poorer service standards for customers. That is an issue for Post Office Ltd and, dare I say it, the consumer watchdog, Postwatch, to consider carefully before the end of the consultation period. I welcome the statement that no compulsory redundancies will take place as a result of the changes, but I accept the concerns that colleagues have expressed ably about the possible impact on existing employees. From a Government perspective, I can only stress that the usual channels of assistance will be available from my department to anyone who faces voluntary redundancy as a consequence of the changes.
On the consultation period, Post Office Ltd has advised that there is a code of conduct—which has been agreed by Postwatch—on informing the public of a directly managed branch conversion. Under the terms of the latest edition of the code of conduct, Post Office Ltd has to allow a six-week period—in this case, a seven-week period—of public consultation on proposed transfers. Also, under the code of conduct Post Office Ltd is not obliged to consult on the decision to transfer the branch, as that is a commercial decision. However, it has to consult on the details of the services that are to be provided under the franchise. A number of the issues relating to specific local concerns will, I hope, be addressed in that process. In the instance of the six conversions that are currently under consultation in Scotland, the consultation period ends on 31 January.
Can the minister tell me how many post offices have remained open after consultation?
Minister, you have had five minutes extra. Perhaps you could think about winding up.
There is a moratorium on post office closures.
The point that I am trying to make is that there is an opportunity for members and other interested parties, over the course of the next two or three weeks, to make their views known, to impress their concerns on Post Office Ltd and the consumer watchdog and to ensure that those concerns are taken into account by the company and by Postwatch Scotland in the process.
I thank the Presiding Officer for her indulgence. I am sure that all members agree that there are important issues to be addressed. The points that have been made in the debate will be passed on to both Postwatch Scotland and Post Office Ltd. I am sure that the Official Report of the debate will be studied very carefully by those two organisations.
Meeting closed at 18:07.