The next item of business is a members’ business debate on motion S4M-14183, in the name of John Finnie, on the postcode penalty. The debate will be concluded without any question being put.
I invite members who are leaving the chamber to do so quickly and quietly, and I extend that invitation to members of the public.
Motion debated,
That the Parliament welcomes the publication of Citizens Advice Scotland’s report, The Postcode Penalty: The Distance Travelled; notes with concern the continuing problems highlighted in the report relating to the delivery of online shopping to people in the Highlands and Islands; understands that, while fewer online retailers now impose a surcharge for delivery, those who do have increased these charges by 17.6% for customers in the Highlands and 15.8% for island residents since 2012; welcomes the report’s recommendations, including extending the road equivalent tariff to cover delivery vehicles on ferries and the proposal to encourage delivery to ferries in partnership with CalMac, and notes calls for the Scottish Government to continue to work with Citizens Advice Scotland, trading standards services, the online retail industry and enterprise bodies to support innovation in the interests of consumers.
12:31
I thank the members who signed the motion and I congratulate Citizens Advice Scotland on its fine report, “The Postcode Penalty: The Distance Travelled—Progress on parcel deliveries in Scotland 2012-2015”. The report’s authors are David Moyes and Kate Morrison. The report is the most recent in a long-running campaign, which started in 2010 and involved Skye & Lochalsh Citizens Advice Bureau. There was a further report in 2012 from Sarah Beattie-Smith, whom many members know.
The problem of high delivery surcharges for consumers in remote and rural areas has not gone away. Businesses are affected, too: some 15,000 businesses in remote and rural areas are at a competitive disadvantage because of the problem, as well as being disadvantaged by geography, connectivity issues and fuel costs.
The CAS report says that the problems continue to impact on the Scottish Highlands and Islands. Indeed, it seems that the Highlands and Islands extend as far south as Stonehaven, Perth and Helensburgh. Wonderful locations though they are, they are in neither the Gàidhealtachd nor the northern isles, so there seems to be a lack of geographical knowledge in that regard. Perhaps it has something to do with postcodes.
Some things are better than they were three years ago, but we started from a very low threshold and, as the report says, high delivery cost
“is a problem that is getting more pronounced.”
Almost 50 per cent of retailers were applying surcharges in 2012; that is now down to 44 per cent. As ever, the islands are disproportionately impacted, with 62 per cent of retailers surcharging in 2012 and 53 per cent surcharging now. The percentages might have gone down, but customers who are surcharged are paying more, despite average delivery charges remaining static and falling in real terms. Highlands and Islands customers are paying roughly four times as much for delivery.
Overall, the position is slightly better than it was, but it remains disappointing. The report tells us what we all know, which is that the United Kingdom online shopping market is one of the most developed in the world, accounting for 15 per cent of total retail sales. That is important, because the market gives people in remote and rural areas the same levels of choice of goods as people in population centres enjoy. However, people in remote and rural areas are often excluded from a range of delivery options and face higher delivery charges to such an extent that online shopping is uneconomical for them.
Rural living presents many challenges. The report mentions research that indicated that
“rural household budgets need to be 10-40% higher in order to achieve a minimum acceptable living standard.”
Legislative compliance is all the more important against such a punitive background. More than a third of internet sites give customers less than the statutory notice period in which to return items, and some retailers have failed to update their terms and conditions to include the consumer contracts regulations. Robust enforcement is required.
Members might be aware of the “Statement of principles for parcel deliveries”. That is a grand title. The statement came into effect in 2014 and should have had a positive effect. However, only four of the 449 businesses that were surveyed for the CAS report knew about it, which is shocking. That is simply not good enough.
The challenge is not just for domestic customers. We want to encourage everyone to use their local businesses, which also face delivery problems and must pass on additional charges.
Citizens Advice Scotland not only highlighted problems but suggested solutions. In the limited time that I have, I will focus on some of those solutions, and I hope that the Minister for Transport and Islands will be able to respond to them. CAS recommends that the Scottish Government considers extending to vehicles that are more than 6m in length the road equivalent tariff fare structure in order to help to reduce the cost of delivering goods to islands. I appreciate the complexity around that, but as we heard in the report,
“I am as cheap to buy a [ferry] ticket and drive as R.E.T. is cheaper than using a carrier”.
That came from a Western Isles business owner.
There are opportunities focused around the “final mile consolidation”, as it is referred to.
John Finnie referred to an extension to the road equivalent tariff. It will not surprise him that those of us who represent islands that do not benefit from the road equivalent tariff would argue strongly for such an extension to benefit smaller businesses in Orkney and Shetland. Does he agree?
I agree absolutely, because I also represent the Orkney Islands. That is why I said that I appreciate the complexity of the situation and its financial implications.
We know from the report and the research that islands are more willing to engage in delivery solutions. That could mean collection from the local post office, which could have the knock-on effect of adding to sustainability, as could delivery to ferries and collection from island-side ferry ports. We are in the unique position of having Caledonian MacBrayne, so I hope that the minister will take the issues on board. There will always be challenges and the competitiveness of delivery costs and speed will be part of that.
The report also recommends that the
“Scottish Government considers how the public sector can work with the industry to encourage final mile consolidation in order to reduce delivery costs for Scottish rural consumers.”
Again, it would be helpful to get some feedback on that.
The report uses the term “logistical innovation”, which would give the opportunity to benefit a range of people.
In the short time that is left to me, I will comment on Royal Mail and the suggestion that there is the option of extending or enhancing the universal service obligation, and that it could cover new products. The report says:
“The growing importance of parcel deliveries to businesses and consumers adds another reason to value and preserve the universal service.”
That is important because of the downturn and changes in the level of use of letters.
CAS is doing a lot of good work, including collaborating at United Kingdom level, and I recommend that the minister pick that up. Aspects of the subject are reserved, but the minister has the opportunity to engage on the issues, not least on extending the definition of universal service obligation to cover more of the parcels market. I would appreciate it if the minister could pick up on the Scottish Government elements of that and confirm that he would be willing to work with the UK Government on the other matters.
The report is excellent and well-evidenced, and we all want to support the innovation that it outlines. It presents opportunities for retailers and customers and, if we do this right, for the planet.
12:38
I commend and congratulate John Finnie on securing the debate.
In 2015, when surcharges were applied, rural customers were paying roughly four times as much for delivery as their urban counterparts. Those surcharges have increased approximately 10 per cent in real terms since 2012, while average delivery prices throughout the country have dropped by 6 per cent.
More than 50 per cent of retailers surcharge island residents, 44 per cent surcharge Highlands customers and 11 per cent of retailers refuse to deliver to parts of Scottish islands. Online retail becoming increasingly ubiquitous and the decline in physical shopping have placed a huge burden on rural customers, especially on my constituents in Argyll and Bute. The problems make living in Argyll and Bute more difficult. Of the land in my constituency, 96.5 per cent is remote and rural, and 17.5 per cent of people live on islands. Almost the entire constituency is affected by unfair and high surcharges.
Royal Mail does not impose surcharges and the universal service obligation is ever more vital. When I lived in the Western Isles in the 1970s, the postman went the 3 and a half miles to Rhenigidale by foot twice a week. That history is an impressive one. We need to carry that commitment forward—and to carry the postal service forward—in a way that helps people in rural areas.
Surcharges are often based on erroneous information and subjective analysis. My constituent Christine Roth, in Campbeltown, has told me that she often suffers three times the standard delivery charges because couriers say that she lives on an island. It has been a long time since Campbeltown was on an island of its own.
We need to find ways to make progress on this issue. First, we must revise and improve the universal service obligation to accommodate the increasing use of parcels. We need to increase the types of parcels that are covered and we need to broaden the scale of the Royal Mail commitment. I have to say that the members of the current Scottish National Party presence in Westminster have a chance to deal with a reserved matter to favour Highlands constituents. The universal service obligation has been a key part of ensuring reasonable prices and delivery to the Highlands for generations. It now needs to be modernised to reflect the reality of life.
The new Consumer Rights Act 2015 will come into force on 1 October, so this is the perfect time to educate businesses and consumers and to ensure compliance with the minimum standards for delivery services. Earlier in 2015, a quarter of businesses that were surveyed stated that they deduct delivery costs from returned items. That is not in compliance with the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 or with the legislation that will come in on 1 October.
Some small items carry a rural delivery surcharge of up to £50. If we add in a cost deduction for return, that means that some rural customers are stuck with items that are worth less than the carriage.
Of course we have to work with courier services and retailers to simplify delivery services. Final mile consolidation, to which John Finnie referred, is important. Courier services could drop small loads or packages at one place and a single carrier could finish the deliveries.
Co-ordinated ferry delivery would be very positive. The minister this week made a very useful and helpful intervention in supporting ferries. More could be done to make sure that those ferries become an agent of delivery. There could also be more delivery to local shops and post offices by couriers.
Yesterday my office spoke to Chris Lamb, the manager of the Jura community store, and learned that bulk items and perishables are delivered not to Jura but to a depot on Islay, from where they are picked up. The community does that; the community is helping itself. That could happen elsewhere.
We must do our best to help our constituents. Presiding Officer, in concluding I must say that I have to go and help two of my young constituents who have just come to the Parliament, so I am unable to stay. I apologise to other members, but I am very grateful to John Finnie for securing this debate and to Citizens Advice Scotland for taking things forward.
12:42
I will start where Mike Russell finished and offer my apologies to you, Presiding Officer, to the minister and to all members for the fact that I will have to leave the debate before the end.
I, too, congratulate John Finnie on the motion and on securing the debate, which allows us an opportunity to acknowledge the work that has been done by CAS more generally and by citizens advice bureaux across the country. I certainly know that in my Orkney constituency the CAB is a vital local partner that helps me to serve my constituents better. I put that on record at the start.
CAS performs a wider campaigning role, not least on this issue of unfair surcharges. I recall lodging a very similar motion to the one that John Finnie has lodged to coincide with an earlier report on this issue. The information that the report provides is fascinating. It is a detailed study that is based on widespread research, and it paints a picture of the situation that faces my constituents and people across the Highlands and Islands. It sets out the impact on individuals, but also, crucially, the impact on local businesses—a point that John Finnie made very well—and it highlights the surcharges and instances of people failing to get their products at all. The CAS reports also allow us to track the situation over time.
The latest report makes for interesting reading. It suggests that fewer online retailers impose a surcharge than did so in 2012, but those that do are charging more than they were three years ago. The hike of about 16 or 17 per cent in charges is set against a general falling trend in the rest of the United Kingdom. Fewer retailers are refusing to deliver at all, although that still happens.
That rather bears out my experience. When I am approached by constituents and I contact companies, they are often willing to look again at their practices and to consider whether to reduce or remove the additional charges—or, at the very least, to offer clearer advice to those who are purchasing online.
The Royal Mail confirmed in its briefing that
“parcels up to 30kg are available through our universal service of first and second class post to all our customers no matter where they live.”
So the option is there, and it is not an option of which the online retailers who are surcharging are entirely ignorant. I was contacted recently by a constituent on Stronsay—unlike Campbeltown, it is an actual island—who had ordered a product online and was told that there was a £5.99 surcharge and an extra surcharge of £7.99 because he lived on an island. He needed parts desperately for his work, so he went ahead and ordered them. However, they arrived by Royal Mail in a postage-paid envelope, which made a mockery of the need for a surcharge.
That example demonstrates that more still needs to be done to address the postcode lottery, which continues despite the introduction of a code of practice by the previous coalition Government. I note the concerns that John Finnie raised in that regard. I would certainly be interested to know whether the minister feels that there is more that the Scottish Government can do to apply pressure. I thank Citizens Advice Scotland for its efforts in continuing to shine a light on those postcode practices; it can justifiably claim a fair degree of credit for some of the progress that is outlined in the latest report. I look forward to continuing to work with CAS and colleagues across the chamber to achieve further progress.
Again, I thank John Finnie for securing the debate and allowing Parliament to lend its collective voice to calls for a fair deal for customers and businesses in Orkney and across the Highlands and Islands. I apologise again for having to leave the debate early.
12:46
I, too, congratulate John Finnie on securing the debate, which is particularly important for my constituency of Skye, Lochaber and Badenoch.
John Finnie’s motion mentions trading standards services. I spent most of my professional career as a trading standards officer, finishing with Highland Council a number of years ago as director of protective services. We looked quite a bit at the kind of issue that the motion addresses, but one of our major problems was a lack of powers to do a lot about it. I declare an interest, in that I am still involved with the Chartered Trading Standards Institute as a UK vice-president.
High surcharges are nothing new, but the CAS report clearly shows that the problem is not just high surcharges but late delivery and people being excluded altogether from the supply of goods. That situation applies not only to consumers but to businesses, and it can be particularly damaging for small businesses in relation to both receiving the goods that they need for their business and getting goods out of their areas.
Like Mike Russell, I have lived in the Western Isles—I lived there from 1973 to 1983. There was not an awful lot of shopping choice in the Western Isles at that time, so the great lifesaver was the mail-order catalogue. The catalogue company that sticks in my mind was called J D Williams. Using the catalogue was a fantastic shopping experience because you did not get dragged around shops by your wife for hours on end and then go back to the first shop to buy an item: you just flicked through the catalogue in the comfort of your sitting room. In addition, we did not have much money in those days, but we could pay up a catalogue order over 40 weeks or more. I remember that at one point we needed a new bed, so we bought one from the catalogue and paid it up. The bed was delivered free of charge to Stornoway from the main depot of J D Williams somewhere down in England: there was no additional cost. Anybody in the UK who ordered that bed got it delivered free of charge, so it appeared at our door at no extra cost.
I like the sound of this J D Williams. Is it still trading?
I thank Christine Grahame for her intervention—I think that the company was taken over some time ago. The principles on which it operated should be applied by companies these days, but unfortunately they are not.
I will move on quickly, Presiding Officer—
You are in your last 40 seconds.
Before I move on to my point about Royal Mail, I highlight that there has been a real problem with trading standards departments in recent years in so far as their numbers have been decimated. There have been a number of reports on that, including one from the Department for Business, Innovation and Skills. The Convention of Scottish Local Authorities and the Scottish Government are also working on a report. We need to strengthen the trading standards service if we want to tackle some of the issues that have been raised today.
I will conclude with Royal Mail. We need a public sector Royal Mail, and we need to increase the maximum delivery weight from 30kg to 100kg. That would deal at a stroke with delivery of goods weighing up to 100kg—or 220lb—to anywhere in the country. Any decent sensible Government would do that, but unfortunately the present UK Government is going in the opposite direction.
12:50
I, too, congratulate John Finnie on bringing the debate to the chamber. As he said, the postcode penalty affects people in the Highlands and Islands, but it also has an impact on consumers across the north of Scotland. The definitions of “Highlands and Islands” that are used by the parcel delivery companies cover not only thousands of people whom I represent who live and work in the rural north-east, but also people in the Aberdeen travel-to-work area. People who live in the north-east and who work in, and travel in and out of, the city of Aberdeen every day can find themselves caught by those discriminatory charges. Aberdeen may have more direct connections by plane and train to London every day than many comparable cities, and it may generate a higher gross domestic product than any other city of its size anywhere in Britain, but to many of these delivery companies it is clearly a far-flung outpost on the way to the Arctic circle, or perhaps just an opportunity to make more money from discriminatory charging.
These companies’ idea of delivery to Scotland’s islands seems to come from too many viewings of the black and white version of “Whisky Galore!”, and they remain entirely uninformed about the existence of bridges, causeways or lifeline ferry services.
The authors of the “Postcode Penalty” report call on the UK Government to use the Consumer Rights Act 2015 to educate business and customers about rights and obligations, and to look at revising the universal service obligation. Those recommendations are welcome, but they do not go far enough. We cannot rely on the present Conservative Government to be on the right side of the argument.
The Department for Business, Innovation and Skills Minister of State Nick Boles, in addressing the debate at Westminster the other day, rejected calls for legislation and offered instead a round-table event involving online retailers and Government ministers. It is hard to see how a cosy chat with ministers will make any difference to the world view of retailers and service providers who have not bothered to sort out the problem by themselves.
What is required instead is to make the customer king. If retailers cannot be trusted to be honest and up front about delivery costs or to explain clearly where surcharges apply, we should give customers the right to know. A statutory right for customers who order online to choose their delivery service provider would allow people in remote and rural areas to choose Royal Mail and therefore force its competitors to match the company’s quality of service to customers rather than simply trying to undercut their costs to suppliers.
Royal Mail delivers parcels everywhere in the United Kingdom with no surcharge whatsoever. Despite the folly of privatisation, it continues to take pride in delivering on its universal service obligation six days a week to every inhabited island and remote neighbourhood in the country. Other suppliers could be forced to do the same. That could mean either giving customers the right to choose, or alternatively permitting parcel delivery only by providers who adopt the universal service obligation in full.
If privatisation is bound to hit rural areas hardest, the prospect of contracting out lifeline ferry services to the Hebrides and the Clyde islands will fill islanders with concern. Our view is that the Scottish Government should keep those services in public hands
Will the member take an intervention?
Not at the moment—I am sure that the minister will respond to that point later.
If the Scottish Government will not keep those ferry services public, and the Tories will not intervene on parcel delivery surcharges, the Scottish ministers should certainly use the powers that they have in this field. As John Finnie argued, the RET could be extended to cover larger vehicles, thereby creating savings for retailers that could and should be passed on to consumers, as well as removing one poor excuse that the retailers have for their discriminatory behaviour.
Warm words from anybody on the subject are not enough. Government here and at Westminster must take the issue seriously and accept that privatising efficient public services will never be in the public interest.
12:54
I will keep to the topic under debate. I commend John Finnie for securing the debate and I acknowledge that, as members have said, the impact of delivery charges is undoubtedly greater in the Highlands and Islands. I congratulate, too, Citizens Advice Scotland, which now deals with consumer issues. It is of substantial use, not just to the general public but to members like me.
Believe it or not, the issue of what are excessive delivery charges also lies in my Borders constituency. I received an email from Valerie Bannerman from Walkerburn who had placed an order with Abbey Couriers in England. Having been advised that the delivery charge would be £65, she was astonished to discover, when the goods arrived, that she was being charged almost double that amount. The price for England and Wales—the standard rate—is £80: for Scotland it is £150. Indeed, it is even more if, based on their postcode, someone is marked up as living in a remote area.
In fairness, the rates are on the firm’s website. However, having been told the rates, my constituent checked no further. That said, if someone is in Berwick, which is 1 mile south of the border, the rate is £80, but if they are in the cottages on the A1—a trunk road—half a mile over the border into Scotland, it is £150. No ifs, no buts.
My constituent was told by the company that she had been misinformed and that £65 was the UK price. She said:
“When I pointed out that Scotland is part of the UK ... I was told that £65 was for England and Wales only. This I was informed was because of crossing the border, mileage and fuel charges and that I was fortunate because £120”—
the amount that she was eventually charged—
“was the trade price and that I should be paying £150!”
There cannae be much mileage in half a mile, and there will certainly be very little fuel. There are injustices down on the border that we would not expect.
I took the matter up with the firm in July and, given that it has not replied, I will name it in this chamber. I will send the firm a copy of the Official Report—maybe then it will bother to reply—and advise Citizens Advice Scotland of what I have done. So, Abbey Couriers of Ledbury, Herefordshire, you are named and shamed because you have not taken the trouble, over all those months, to reply and explain to me why, if someone is only half a mile over the border, they are paying an extra £80 for delivery.
I notice that the company says on its website:
“We are big enough to provide a national service, and small enough to provide a personal caring service to every single customer.”
Well, not if that customer is in Scotland, when it is double the price.
I will also touch on the Royal Mail. It was privatised in 2013 and sold off at bargain basement prices on the first day of trading in October 2013. The prices leaped up by 38 per cent, rising to a peak of 615p. Of course, many of the large investors immediately sold off their shares and made big bucks, and £1 billion was lost to us, the original shareholders of the Royal Mail.
There is a difficulty here because the guarantee of a universal service is protected only until 2021. If I am around then, God willing, let us see whether there is still a universal delivery service with the Royal Mail.
All of that gives concern, not just because of my constituent Valerie Bannerman and others throughout the Scottish Borders but, as others have said, because many people in rural areas rely on these deliveries to maintain their businesses and to send their products out, and they are being surcharged unfairly.
12:59
Dave Thompson sounded very posh when he talked about getting a catalogue. When I was growing up in Angus, it was known as the clubby book—I think that that was the word. “Catalogue” sounds amazing.
I, too, thank John Finnie for bringing the issue to the chamber and Citizens Advice Scotland for providing us with an update on the postcode penalty. As a former volunteer for CAS, I always highly value and respect the work that it does, not only on a wide range of issues but on behalf of people throughout Scotland.
As John Finnie said, the UK online shopping market is one of the most developed in the world. Its sales now contribute up to 15 per cent of total retail sales. Remote consumers benefit from the same level of choice that is enjoyed by those closer to the population centres.
Of course things could be better, but the report has some good news that we should look at, which may be a result of CAS’s on-going interest and awareness raising. The number of retailers who add a delivery surcharge has dropped from the number three years ago; the proportion of retailers who surcharge consumers on the islands has dropped by 11 per cent; and the proportion of those who surcharge consumers in the Highlands has dropped by 5 per cent. Those are steps in the right direction, although there is still more to do.
It is worth commending Royal Mail. It delivers parcels weighing up to 30kg through the universal service of first and second class to all consumers, no matter where they live, on six days of the week.
It is disappointing that, where it still exists, the surcharge has risen. However, it is good news that, compared with the figure in 2012, fewer retailers now refuse to deliver to remote areas—there has been a fall of 7 per cent.
As members have said, there is no doubt of the additional costs to not just consumers but those who do business across Scotland. As John Finnie said, the recommendations to the delivery operators were very constructive. Much more can be done by looking at a range of options, including collection from the post office, local shop or other safe places. I also hope that the ferry terminals could be used as pick-up points, where appropriate, as that could reduce road miles and costs significantly.
I was concerned to read about how businesses cope with the surcharges. Twenty per cent of businesses absorb remote delivery surcharges and 3 per cent spread them across all customers. However, the worrying figure is that 24 per cent pass on the surcharge in full to customers, which creates a massive increase in the cost of living and the cost of doing business in remote and rural areas.
Michael Russell made a very good point. We are talking about delivery, but the issue is not just about that. If someone does not like what has been sent to them, the cost of returning it is absolutely prohibitive. I have returned parcels in Inverness. The cost on a parcel from Amazon is something like £5, but that is based on Amazon’s agreement with the Post Office. The cost for the consumer to send a parcel back is about £40, which is worth illustrating. As Mike Russell said, people are often left with goods that they do not want.
My recommendation is to name and shame retailers with the highest surcharge. I am quite sure that the Stornoway Gazette, The Shetland Times, The Orcadian and Highland newspapers would not mind publishing the names of retailers with a high surcharge and those that do not surcharge.
I thank John Finnie once again.
13:03
I add my congratulations to John Finnie on securing this valuable debating time.
As we have heard, the growing online market is of particular importance to rural, remote rural and island communities. However, as we have also heard, rural and island consumers are often excluded from home delivery options or face high delivery surcharges that can make online shopping very expensive. It is not acceptable that many constituents are inhibited in their online shopping options because they live in a particular area.
In 2012, when CAS published its full report on the postcode penalty, it found that 6,400 of my Cunninghame North constituents were affected by discriminatory charging.
Additional delivery charges are a major issue for 15,000 businesses in remote, rural and island Scotland, which puts them at a competitive disadvantage. As we know, the additional delivery charge impacts the Highlands and Islands, which includes Arran and Cumbrae in my constituency, more than other rural areas.
When a surcharge is added, Highlands and Islands consumers pay approximately four times as much for delivery as mainland consumers. For example, one consumer purchased an item costing £1.15; however, the total charge was £51.14 after the imposition of an absurd £49.99 delivery charge. The item itself was therefore worth 2.3 per cent of the delivery charge. Since 2012, surcharges for Highland consumers have risen by a whopping 17.6 per cent and for island consumers by 15.8 per cent.
I know that the low profile of the “Statement of principles for parcel deliveries” will come as a disappointment to the minister, who, along with his colleague Fergus Ewing, has worked very hard on this matter. There is a clear issue of communication here between businesses and the Scottish Government, and although it is frustrating that, as Dave Thompson pointed out, the Scottish Parliament does not have more powers over mail delivery, more has to be done to raise awareness of the “Statement of principles for parcel deliveries”.
Delivery charges can be a major challenge not just for consumers but for small businesses in rural and island areas. John Finnie, Mike Russell, Mary Scanlon and others have suggested a number of potential solutions such as mail collections at ferry terminals that would allow online retailers to consider changes that would benefit their own consumers. Of course, businesses in rural areas have less of a choice with regard to delivery operators and are more likely to rely on Royal Mail. Colleagues have been almost unanimous in highlighting how Royal Mail, as the only provider of the universal service obligation in the UK, does not levy a surcharge on the Highlands and Islands of Scotland. Parcels of up to 30kg are delivered through the obligation to provide first and second-class post to all customers, no matter where they live, six days a week, and it is unfortunate that more online retailers do not use Royal Mail.
For online shopping to be an enjoyable experience for the consumer, an intricate set of business relationships and economic structures must be maintained by the retailer, the delivery operator and often a separate supplier of goods. Some problems can develop early on in the ordering process. The design of the retailer’s website can be crucial for the customer’s home delivery experience, and some websites fail to mention early on in the process that, because of an individual’s postcode, delivery costs or promotions do not apply to them. As a result, consumers waste time and the retailer loses out on business. I also note that CAS recommends that the Scottish Government consider how the wider public sector can work with the industry to encourage final mile consolidation and reduce delivery costs for Scottish rural and island consumers.
I thank John Finnie for bringing this debate to the chamber, and I trust that the Scottish Government will continue to engage with its Westminster counterpart in making improvements that will assist postal services in rural and island Scotland.
13:07
I, too, congratulate John Finnie on securing this debate. My colleague Fergus Ewing, the Minister for Business, Energy and Tourism, has taken a close interest in this issue for many years and he is disappointed that he cannot be here for this debate. He, of course, would have taken the lead on this issue, but as minister with responsibility for islands and transport issues, I, too, have a clear interest in the matter.
Over the summer, I visited a number of islands and heard about the challenges facing island living, of which this issue is one. There are actions that the Scottish Government and, indeed, the UK Government can take. I agreed with a lot of what Lewis Macdonald said, but I found his unnecessary and ill-informed scaremongering on the ferry contract most unhelpful and inaccurate.
Will the minister give way?
Well, I think that you reap what you sow. I should not take an intervention, but I am such a kind character that I will of course do so from Mr Macdonald.
I am glad to have allowed the minister to rediscover his generous side and very much appreciate his taking my intervention.
Whatever the minister’s view of the process that he is about to undertake in relation to CalMac, does he recognise my point that people in the islands are very anxious about the prospect of a private company taking over a successful public service? The point is absolutely real. It is not something that I have made up; it is something that people in the islands will have told him, had he been listening.
I have been listening very closely to what islanders have been saying about ferry services and, to be frank, a lot of the anxiety is being caused by the Labour Party perpetrating untruths about the current process.
Lewis Macdonald also said that we should simply keep the contract within the current framework. However, he knows that doing so would be a breach of European regulations and would put the ferry services into some doubt, as we would be in conflict with regulations and subject to all sorts of challenges. We will comply with the law and get the best possible deal.
I will now do the reassurance bit for the islanders. Whatever the outcome of the procurement exercise for the Clyde and Hebrides ferry contract, the timetables will be set by Government, the vessels will be owned by the public sector and the fares will be set by the Scottish Government, through the operator. Of course, one challenge for potential operators is how they can consider the needs of island communities and respond to the suggestions that have been made in this chamber this afternoon around how they can further use the infrastructure, the hubs and the transport connections to give those communities further support on the transport side. There is an opportunity here, but there is no risk to services, as was suggested by Lewis Macdonald.
I am particularly interested in the legislative aspect of being able to choose the provider—that is, to choose Royal Mail. That is a very helpful suggestion. No matter what the Scottish Government can do in terms of ferries, routes, timetables, hubs or anything else, ensuring people’s rights through legislation would address a number of the issues that would be more difficult to address through perceptions or other interventions.
I commend Citizens Advice Scotland for drawing attention to this issue, for its work and for sharing with us its case studies and the evidence that it has produced. I can assure all members that that will inform future transport and island policy, as well as the business agenda.
In 2012 and 2013, Fergus Ewing chaired parcel delivery summits that led to the statement of principles, which I fully accept has not been adopted by as many people as we would have liked it to be. Again, if that statement were placed on a statutory footing—that could be done only at Westminster, not here—we would welcome that. I saw that the minister, Nick Boles, said that he does not want to go to primary legislation or even regulation, but that might be the best thing to do. I understand that he visited Colonsay during his summer holidays. I was also on Colonsay in the summer, although not at the same time. I know that he heard from islanders about their specific needs when he went there.
I raise that as an example because one of the interventions that I have made as transport minister is to consult on improved timetables. Why does that help? Because that might allow a better turnaround for deliveries to and from the islands, which might make it easier for carriers to get products and vehicles—because sometimes the issue is to do with vehicles being stuck on the islands—on and off the islands.
There might be more beneficial mechanisms than putting more vehicles on the islands, which might be challenging in a competitive marketplace. Will the minister agree to play a facilitating role in the consideration of those options?
Yes, I am happy to get Transport Scotland to consider the issues around collection hubs, transport hubs and so on. That is a helpful suggestion and I will commit to my officials undertaking that work in partnership with other stakeholders. Further, through community planning, it is important to encourage a focus on a sense of place and what more transport can do to help with this and every aspect of island living. I will also commit to listening to the comments of the rural parliament and the rural network. Like other members, I recognise that this is not only an island issue, although it is of importance to the islands.
It is an issue in the Borders.
Indeed—it is an issue across the mainland, including the Borders.
Work will also be taken with Citizens Advice Scotland and Highlands and Islands Enterprise to consider a range of models that might be deployed and replicated across the country.
There is a record amount of funding for lifeline ferry services. In this financial year, more than £145 million has been committed to support them. We have expanded the road equivalent tariff scheme across the Clyde and Hebrides network—that will be completed next month.
When commercial vehicles were eligible for RET, there was evidence that that reduction was not passed on to the customer. That has to be ensured before we can even consider using the scheme in that way. In 2012, we were able to allow commercial vehicles under 6m in length to qualify for RET. That means that post vans and smaller courier vehicles will get the discount, which means that they will pay less than the current commercial fares. Of course, the issue is about affordability and the need to ensure that those who are intended to benefit are the ones who benefit. That is why I am considering the current freight policy, too. I will report on that later this year.
That range of transport actions represents what the Scottish Government is doing. Like others, I again call on the UK Government to take action. Lewis Macdonald talked about a cosy chat with ministers but—who knows?—it might lead to further regulation and legislation. However, the principles should apply, so that we can have better universality of charges and do not discriminate against areas of peripherality, rurality or island living. I again call on the UK Government to act in that spirit.
13:15 Meeting suspended.Previous
First Minister’s Question TimeNext
Point of Order