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Post Office

Volume 487: debated on Wednesday 4 February 2009

To ask the Minister of State, Department for Business, Enterprise and Regulatory Reform how much the Post Office has contributed to the Exchequer in external financing contributions to Government revenues (a) since its establishment as a public corporation and (b) in each of the last 30 years; and if he will express each figure in current prices. (249630)

[holding answer 20 January 2009]: The External Financing Limit (EFL) regime, whereby the Post Office corporation was required to generate funds for the Exchequer, began in 1976-77. A total of £2,48l million was generated up to financial year 1998-99 and the amounts were retained on the company’s balance sheet. These funds were not removed from the company and used for Government purposes. Instead the funds were used to support the Post Office Network and more recently the Royal Mail pension fund. The EFL regime no longer applied beyond this period.

The following table shows the value of the EFL outturns for financial years 1976-77 to 1998-99 in historic as well as current prices.

Post Office corporation EFL outturns from 1976-77 to 1998-99

£ million

EFL outturn

Current Price1

1976-77

1

4.7

1977-78

22

94.6

1978-79

17

64.5

1979-80

3

9.6

1980-81

8

23

1981-82

13

34.4

1982-83

60

151.7

1983-84

62

149.4

1984-85

100

227.1

1985-86

75

164.7

1986-87

93

196.1

1987-88

80

160.8

1988-89

102

190.2

1989-90

102

173.8

1990-91

1991-92

74

114.8

1992-93

80

122.1

1993-94

182

271.3

1994-95

235

338.6

1995-96

245

344.7

1996-97

268

365.6

1997-98

338

445.8

1998-99

321

416.9

Total

2,481

4,064.4

1 Current price calculated with reference to the Retail Price Index data obtained from the Office for National Statistics.

To ask the Minister of State, Department for Business, Enterprise and Regulatory Reform whether the Government's proposals for the reform of the Post Office entail the assumption of responsibility by the Government for liability arising from underfunding; or whether the Government plan to assume such responsibility in return for the underwriting of future pension promises. (250504)

[holding answer 22 January 2009]: The details of how the Government will tackle Royal Mail's pension deficit are still being developed. My noble Friend the Secretary of State will be making a detailed policy statement on the Government's package of proposals for reform in the early part of this year.