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Post Office Network

Volume 730: debated on Thursday 23 March 2023

I thank the hon. Member for Motherwell and Wishaw (Marion Fellows) for the fantastic job she does as chair of the all-party parliamentary group on post offices. I met the Post Office leadership this week to reiterate our commitment to ensuring the long-term sustainability of the post office network. We have funded the network to the tune of £2.5 billion over the last 10 years, and have set access criteria to ensure that vital services remain within local reach of our citizens.

I thank the Minister for his kind words. Last month, London Economics issued a report showing that the Post Office has a greater economic impact on the UK than Heathrow airport, with three in 10 small and medium-sized enterprises using it at least once a week. The Minister has said that he will invest lots of money in the post office network, but could he also look at “drop and collect” locations? They have a Post Office lozenge, but they are not the properly functioning post offices that most Members in this House would expect.

The hon. Lady raises an important point. Drop and collect locations offer important services for our citizens, and can be counted towards the commitment to having 11,500 branches. Having said that, the access criteria overlaid on that commitment ensure that branches offering core services, including the sale of mail products, access to cash, and banking and bill payment facilities, remain within 3 miles of 99% of our population.

The report to which my hon. Friend the Member for Motherwell and Wishaw (Marion Fellows) referred found that the social value delivered by the Post Office is 16.5 times greater than the financial input it receives from the Government, so will the Minister carry out an analysis of how additional investment in the post office network will allow it to continue to grow, so that it can help our communities and small businesses to grow and develop?

That is a very good point. We are working all the time with the Post Office—as I said, there was a meeting earlier this week. Around half of its 11,500 branches are in rural areas. They are hugely important to our local communities, as the hon. Gentleman says. The Government’s funding for the network helps to ensure the viability of rural branches. Of course, this will always be work in progress. We are keen to make sure that the facilities are there for our communities.

Thank you, Mr Speaker, and may I wish Ramadan Mubarak to all those who today mark the beginning of the holiest period in the Islamic year?

The Minister will be aware that the model of sub-post offices is based on the expectation that most of them will be run by small, semi-independent or independent retail businesses. Those businesses are under desperate strain for a number of reasons, some of them within the Government’s control and some not. The people who run these businesses tell me that they are put off the possibility of taking on the responsibility for a sub-post office because it is now more a drag on the business than a benefit. What steps is he taking to review the business model on which sub-post offices operate? It is quite clearly not fit for purpose, and we are getting to crisis point. If it is not changed soon, we will lose even more post offices.

The hon. Gentleman makes a fair point. The model of a post office is evolving to a more diversified approach, but it is important that remuneration is fair and makes post offices sustainable. I was pleased to see that in August 2022 some improvements were made to remuneration. I appreciate that they may not have gone as far as some might wish, but nevertheless we want to see a sustainable network and make sure that our sub-postmasters are fairly remunerated.

In an hour or two we will hear the latest update on the Horizon compensation scheme. Has the Minister made an assessment of how much damage that scandal has done and is continuing to do to the willingness of businesspeople to take on responsibility for running a sub-post office, given how severely badly treated, and indeed betrayed, so many of their potential colleagues have been in the past?

Again, that is a very fair point. It was a horrendous scandal, and the first thing we need to do is properly compensate the victims. Alongside that there is an inquiry going on, headed by Sir Wyn Williams. It is important that we find out exactly what went wrong and who was responsible, and where possible hold those people to account. I think that will restore some measure of confidence to those who have been subject to such disgraceful mistreatment.