HC Deb 27 January 1969 vol 776 cc1012-69

7.9 p.m.

Mr. Paul Bryan (Howden)

I beg to move, That this House regrets the deteriorating services provided by the Post Office. It is unfortunate that this debate is taking place with a background of a very serious industrial dispute. It is no purpose of mine to raise the subject in this debate, except to express the hope on behalf of my right hon. and hon. Friends that a fair settlement will be reached very soon.

In normal times, a critical Motion of this sort would be worded in such a way as to indict the Postmaster-General as the Minister responsible. On this occasion, that is quite impossible because we have had three Postmasters-General within the last year. They could all be indicted, together with the one before them. The fact that we have had so many Postmasters-General is probably the least obvious but certainly the most telling reason for the disarray in the Post Office's services.

No one imagines that a good staff with long years of service suddenly will become bad. Lack of continuous and informed leadership has led to the wrong decisions and the consequences therefrom. Therefore, I do not entirely indict the Postmaster-General tonight. I indict the Government for degrading the post of Postmaster-General into a kind of temporary parking ground for Ministers on their way to other jobs.

Many hon. Members in the House tonight have taken part in debates in Committee in which we have stressed the importance, size and responsibilities of the Postmaster-General's job. One reason for the Bill being discussed in Committee is that the present responsibilities are too big for any one man. Yet this year, which has already been named by the Postmaster-General as a time of the most important changes in the Post Office for a hundred years, it is apparently not necessary to have the Postmaster-General in continuous charge. This has led to great damage to the status of the Post Office, to the morale of post office workers and, of course, to the functioning of the whole service.

Upstairs we have also constantly said that we will try to turn the Post Office into a more commercial undertaking. It is already one of the biggest commercial undertakings in the country, but who would think of having three chairmen or three managing directors of a large concern by design, by decision, in a critical year?

Mr. Alfred Morris (Manchester, Wythenshawe)

I am grateful to the hon. Gentleman for giving way: he is always extremely kind. The hon. Gentleman has talked about those who wish to indict the Government. Is he aware that many would wish to indict the Opposition for what has been said upstairs, in particular about selling off the tele-communications side of the industry? Can the hon. Gentleman speak about the penetration of foreign capital in this direction?

Mr. Bryan

I should be glad to discuss that at any normal time, but this is a debate on the deteriorating services of the Post Office, not on what the hon. Gentleman is talking about.

Reverting to the services, 1968 has been a year of sustained criticism of the Post Office. I suppose that never before has the public had less confidence in the Post Office. This we need no statistics whatever to report. We have only to discuss the matter with our constituents. In fact, we do not have to raise the matter; they raise it. Obviously, the services have deteriorated to an alarming degree.

The Post Office has been continuously in the news. We started early in the year with a discussion on the price rises, which have come on since.

On the telecommunications side, we had the expensive farce of the London Telephone Directory being divided into 36 parts. The most striking thing there was the alarming disregard of the Post Office of public feeling and also of experience abroad. The working of the telephone system has got no better, and the telex services have got worse.

In September we had the verdict of the Comptroller and Auditor General on the buying methods of the Post Office. We were told that about £568,000 could have been saved had different methods been used.

I think that everyone will agree that quite the most wounding blow to the reputation of the Post Office has been the misleading presentation of the two-tier system and the opening weeks of chaos that went with it. The Post Office will not recover from that for a very long time.

Looking to the future, a smaller, but very sticky, problem that the Postmaster-General will have ahead of him is a growing local radio experiment with no apparent means of financial support.

We claim, first, that the postal service has deteriorated. I do not think that is a very risk claim to make. I suppose that 99 out of every 100 people in the country, if asked, "Is the service better now than a year ago?", would undoubtedly say "No". The public is still puzzled why it has gone as it has. Those of us who have studied the question know exactly why. At the beginning of September, before the two-tier system started, 80 per cent. of the total of letters posted got first-class treatment. Of those, 60 per cent. were fully paid for, but, as we know, the system was so flexible in those days that many letters paid for at the: second-class rate got first-class service.

A couple of weeks after this system had started, about 30 per cent. were paying for first-class treatment, and, owing to the utter inflexibility of the system, just about 30 per cent. were getting first-class treatment. Therefore, in this very short time, we had, on the one hand, 80 per cent. of all post getting first-class treatment and, a few days later, only 30 per cent. This vast change in the postal service, plus the chaos, was bound to cause an outcry, because it had no bearing on the "You benefit, we benefit" description given to it.

The Postmaster-General, commenting on some remarks by my right hon. Friend the Member for Altrincham and Sale (Mr. Barber), said: Of course, this meant that many envelopes posted at second-class rates after the introduction of the two-tier system would be delivered more slowly than they were before "—[OFFICIAL REPORT, 4th November, 1968; Vol. 772, c. 569.] The right hon. Gentleman referred to that as though it were a great failing. It is in fact a great success. Having said that—and we can see what he meant—the Postmaster-General did in fact get the message and at the very end of the debate, so that we could make no comments on it, he announced relaxations which would permit some of the second-class post to be treated in the first-class stream when this was possible. I ask: how far have those relaxations been effective and to what extent has the number of second-class letters going in the first-class stream increased? On that occasion, the right hon. Gentleman was talking about relaxations in London and in the country. What other relaxations are there? What is the extent to which this has made a difference? We cannot get statistics, but we hear that the complaints continue.

The Postmaster-General, in that same debate, describing the objectives of the two-tier system, said: The first objective was to reduce the load for fully paid mails from 60 per cent. of all mail to about 32 per cent. Second, to achieve a 95 per cent. delivery of first-class mails by day B, … Third, to achieve a 90 per cent. delivery of second-class mails by day C, … Fourth, to complete first deliveries in town by 9.30 a.m. …".—[OFFICIAL REPORT, 4th November. 1968; Vol 772, c. 614.] I have shortened it slightly, but I do not think I have taken the sense wrongly. That is very clearly put, but it is a straight description of a deterioration of the service.

In the first two objectives, it means that half the quantity of fully paid, first-class mail is to take place and we are to get a 1 per cent. improvement. I think that the highest percentage of day B delivery that we have had before is 93 per cent. We are promised, or we have, an improvement of 1, making 94 per cent. That is the extent to which the first two objectives succeeded.

The other two objectives are resulting in a far worse treatment of second-class mail. The policy means that of a total of all letters, one in 300 will receive better treatment—that is, the 1 per cent. in the first-class mail, which has increased from 93 per cent. to 94 per cent. But at least half, and probably more than half, will receive worse treatment. So the right hon. Gentleman's description of the service is true; it is a far worse service than it was. But that is not what the public was told. It was not told that those who posted first-class mail would get slightly better treatment and all the rest would get much worse treatment.

I ask the right hon. Gentleman not to harp only on the success of moving up to 94 per cent. on day B deliveries. I do not underrate this achievement. Obviously it is more difficult to increase an already high figure by 1 per cent. than a lower figure. It is a considerable achievement. But when we are dealing with such a small amount—coming down from 60 per cent. first-class to 33 per cent.—we expect a better service. It would be amazing if there were no improvement at all. Therefore, there is certainly room for improvement in the direction that I have been indicating. How can we provide more flexibility, so that a far bigger bulk of the service is getting a better delivery than was the case before, and how can we get a far higher proportion of the total mail in the first-class stream?

Nor should the Postmaster-General be overjoyed, as he appears to be, at the number of letters in the first-class stream, and the fact that it has increased from 25 per cent. in September to 32 per cent. or 33 per cent. now. It is difficult to think that the increase is due to the 1 per cent. increase in the percentage of day B deliveries. Undoubtedly it is due to the fact that in those early days deliveries of second-class mail were so chaotic that a person could not continue using it if he had an important or even a semi-important letter to post.

I now want to look into the future and see what assurances we can get from the Postmaster-General. Because the service is worse there has been a drop in the volume of total mail—a drop twice as large as one normally gets after a price rise. The usual drop is 2 per cent.; this time there has been a 4 per cent. drop.

We all appreciate that although these percentages seem small they are very important in the Post Office, because it works on a very narrow margin. It will be too much if, after enduring the birth pangs of the two-tier system, we are told as the year goes on that the tariff must be increased again. The present tariff is meant to keep us going until 1971, when there will be a Tory Government in power.

Mr. R. F. H. Dobson (Bristol, North-East)

A;: the hon. Gentleman has looked into his crystal ball and spoken about the future it might be an opportune time for him to tell us what he will do with the telecommunications service—how he will dispose of it, and to whom if, unfortunately, the Tories get back into power.

Mr. Bryan

This would be an extraordinary minute to indulge in that exercise.

I was going to ask the Postmaster-General whether he would say to what extent the volume of post has fallen and how it compares with what was budgeted, and also whether he can give us some details of the direction in which the movement has gone. Is it in business post? Is it in direct mail? Is it in private mail? Is it merely the result of Christmas? Where does he think the truth lies? Will he give us a financial reassessment?

We know the original objectives of the two-tier system. How is that system going? We were told in the newspapers recently that the executives of the Post Office have asked for economies of £4 million throughout the country. Some newspapers have put the figure at £4 million and others at £2 million. On what calculations are those figures based? Is it the estimated shortfall? How are these figures arrived at?

Can the Minister tell us a little more about overtime, which is a big item in Post Office costs? We had assumed—and the Minister has never sought to deny it—that one objective of the two-tier system was to get rid of excessive work at peak hours as far as possible, together with a certain amount of overtime. That seemed a logical thing to conclude. But now, on the figures with which we have been issued, we have a lower volume of post and a worse service, but more overtime. Why is that? At Question Time on Thursday we were told that the November, 1968, figure was 5 per cent. up on the figure for November, 1967. This is very difficult to understand. We should like to know what the budgeted cost of overtime was expected to be, and how it is working out.

We are very interested in these figures because they are important. I hope that, unlike his reaction on previous occasions, the right hon. Gentleman will not take refuge in his old record—somewhat cracked now—that our postal service is the best and cheapest in the world. Whether or not it is the best is very open to debate after what has happened in the last three months. As to whether it is the cheapest, in the last debate he gave us some figures which I do not say were meaningly misleading but were certainly misleading to me. On 14th November, last year he said that we should compare the various 4 oz. rates. He said that Australia charged Is. 6½d. I was in Australia during the Recess and was under the impression that I would have to pay Is. 6½d. if I posted a letter. I paid only 5½d. The Postmaster-General was referring to the cost of posting a 4 oz. letter—but we do not spend much time posting 4 oz. letters.

This is a short debate, and I do not want to lake too much time. I shall leave most of the questions on telecommunications to my hon. Friend. I merely say that just as the Postmaster-General has rather over-used the 94 per cent. as his yardstick for the efficiency of the postal service, in telephones he has overused the waiting list as a; the waiting list is a measure not only of the number of telephones put in but of demand. Demand depends very much on cost. If the cost of using telephones has increased, as it did last year—and everyone knew that the cost was going to rise—demand is reduced. If charges are doubled the demand is probably halved.

Therefore, these are not over-important indices. It is far more important for us to know whatever statistics, indices or guides the Minister has of the way in which the service is going—because to the average person the telephone suggests endless waiting, wrong numbers, and all the rest of it. That question needs to be concentrated on. We must be concerned not only with the number of people using the telephones but the extent to which they use it. It is at a very low level in this country. If its use rose to any great degree it would at least show that a better service was being provided.

I have said enough to introduce the subject and to give many hon. Members on both sides of the House time to develop it. We assert that the services of the Post Office have deteriorated and deteriorated badly. We also assert and we genuinely believe that what is wrong is not so wrong that it cannot be put right by new leadership and a General Election.

7.30 p.m.

The Postmaster-General (Mr. John Stonehouse)

I originally intended to speak at the close of this short debate in order to give as many back bench hon. Members as possible an opportunity to reply to the discussion so that I could fully reply to the points they raised. However, I propose to intervene briefly at the beginning of the debate in order to bring the House up to date with the situation concerning the strike of the overseas telegraphists and the most unfortunate escalation of this dispute which we are experiencing from today. However, I shall do my best to answer some of the issues which the hon. Member for How-den (Mr. Bryan) has raised. I thank him for the tone and reasonable way in which he has introduced this subject.

Just over half an hour ago I left a meeting, which I attended with my right hon. Friend the Lord Privy Seal, with the representatives of the Union of Post Office Workers to discuss the pay and. productivity dispute affecting the overseas telegraphists. The House will want to know in what circumstances the discussion took place.

The union has been asking the Government to meet it to discuss its claim yet again, and we responded by inviting it to meet the Lord Privy Seal, who, under the Prime Minister, is responsible for the Civil Service as a whole, and myself in order that we could hear what it wished to put forward to us. Also present at the meeting as an adviser was my hon. Friend the Under-Secretary of State for Employment and Productivity.

I am not able to give the details of the discussion which took place, but I want to say that we listened with very great care to what the union representatives said to us. We reiterated from our side the most unfortunate consequences which would flow from the escalation of this dispute and we repeated the offer, which I have made repeatedly to the union, to accept a 5 per cent. award back-dated to last July and 2 per cent. related to productivity which we could agree could be implemented in this field of our activity. Failing the agreement between us on this award, we again asked the union to agree to arbitration about this dispute.

From time to time I have asked the union to follow the reasonable and normal course of taking its dispute to arbitration. As I understand it, the union members are asking to be treated as civil servants and to enjoy the pay award that other civil servants have enjoyed, and it is reasonable, if there is a dispute about the implementation of their pay award, that it should go to the agreed arbitration procedure.

The discussion this afternoon clarified two additional points, and I should like to make those clear to the House. We are prepared not only to offer the 5 per cent. plus the 2 per cent. for agreed productivity, whenever this becomes effective, but also to have a post hoc revaluation of the productivity 2 per cent. to ensure that it is being paid for fairly. Furthermore, if the union is not prepared to accept this proposal, we will allow the dispute to go to another form of arbitration different from the orthodox Civil Service Arbitration Tribunal if it has objections, as I believe it has overwhelming objections, to that particular form of tribunal. The union has not so far responded to these two proposals.

I have said on past occasions that I regret the escalation of this dispute. It is a very sad day for the Post Office that so many of our other Post Office employees who are not directly concerned with this dispute, which is very narrow, should have been brought into the dispute as they have, so disrupting communications in the country and creating great inconvenience for the public.

Mr. Raphael Tuck (Watford)

Is my right hon. Friend prepared to say what form this alternative tribunal might take? I feel rather in the dark about that.

Mr. Stonehouse

We would establish another form of tribunal with experts who would not necessarily be drawn from the Civil Service Tribunal itself in order that the union could escape from the Civil Service Tribunal against which it has objections. I do not believe that it would be wise to give the details of the form of the tribunal. Indeed, as this suggestion has so far been rejected by the union, there is no particular value at this stage in pursuing it.

It is very regrettable that an attempt has been made in certain sections of the Press—

Mr. Dudley Smith (Warwick and Leamington)

One appreciates the right hon. Gentleman's difficulties, but I wonder whether he will draw the attention of those concerned to the fact that one of the consequences will be serious delays in the parcel post and that the most serious will affect the pharmaceutical industry, which sends more than 50 per cent. of its products by parcel post. These are life-saving medicines sent to wholesalers and chemists and I am sure that if the right hon. Gentleman drew the attention of those concerned to this fact they would at least bear it in mind in the discussions.

Mr. Stonehouse

I will consider that, and certainly I will investigate whether any special provision can be made for emergency materials which may have to be sent.

I was saying that an attempt has been made during the weekend and particularly today in certain sections of the Press to imply a clash of views among Ministers in dealing with this dispute. Journalistic speculation has been reinforced by statements made by union leaders to the Press and in broadcasts on the B.B.C. I want to make it clear that the Government are united in their attitude to this dispute, and that any suggestion that I, as Postmaster-General, do not entirely support that policy is totally untrue. We believe that the union should accept a solution within the criteria of the Government's prices and incomes policy, and I deeply deplore the attempts being made in certain quarters to drive a wedge between Ministers on this question.

The dispute has been escalated in a way which will have serious effects on the services provided by the Post Office during this week. Members of the union dealing with the telephone services do not work much overtime and so in that respect the effects of the overtime ban are likely to be more irritating than significant. But there may be delays on the telegraphs inland in the evenings.

The postal service, on the other hand, depends heavily on overtime. About one-fifth of its work is done in this way. A ban on overtime would have had very serious effects unless immediate restrictions were imposed. I imposed restrictions and announced them last Friday: the suspension of the inland parcel post, except for local devilery parcels, and also the refusal of rebate postings, which reduces the quantity of mail with which we have to deal. We cannot, however, guarantee that the first-class mail service can be maintained at the standard which we have achieved in these last few months, and, of course, the service is bound to be of a varying order. The situation at post office counters will be severely worsened, although the sub-post offices will not, so far as I know, be adversely affected.

As to the one-day strike on Thursday, the vast majority of phone calls, a high proportion of inland trunk calls and many calls to Europe can be dialled by S.T.D. Substantial public telephone services will, therefore, be maintained. The absence of operators in the largest towns will limit the service and there will be inconvenience, but the situation will not be disastrous. The most serious consequences are likely to be felt in the overseas services to destinations outside Europe.

The 999 emergency service will, of course, continue in use, as I have announced. The telegraph business in the cities affected will cease on Thursday, and this will also apply to many other telegrams routed manually through those centres. The overall effects on the telegraph service will be severe.

Mail services will be at a standstill on Thursday in all the big towns, including London, and the problems produced by the one-day stoppage will add markedly to the problems created by the overtime ban. We hope to maintain the overseas services, but the delays to air mail will be serious.

Our advice to the public in those conditions is that we want to maintain the quality of the first-class service. What we have done is cut the quantity of mail with which we deal so as to maintain, so far as we can, a reasonable service, but we cannot guarantee the 94 per cent. next-day delivery which we have been achieving. We shall, of course, give fresh advice as the situation develops, but we would ask members of the public to avoid congestion by deferring inessential postings until the present situation has passed.

As regards pensions, which is a particularly serious problem for those who receive payment on Thursday, I have arranged for pensions and allowances due next Thursday to be paid on request on the day before, where the post office concerned is likely to be closed on the Thursday because its staff belong to the union which is coming out on strike.

The effects will be less serious on telephones, but I would appeal to the public in the towns affected not to call for operator service on Thursday as that will jeopardise the maintenance of the 999 service. I hope that the present dispute will be only short-lived, because it will certainly produce a great deal of inconvenience and embarrassment, particularly to many firms which rely on internal and overseas communications for their business.

Mr. George Younger (Ayr)

Is there expected to be any serious difficulty in the remoter areas, like the Highlands and Islands of Scotland, as a result of the working to rule and reduction of overtime?

Mr. Stonehouse

I do not expect that the services will be cut completely, but there will be delays in that part of Britain as there will be in the towns.

Mr. Bryan

I thank the right hon. Gentleman for his statement, but would like to ask him one question. When does he expect to meet the union again and when is a decision likely over these fresh talks?

Mr. Stonehouse

I have not fixed another date to meet the union, but there will be consideration on its side, I expect, of the proposals which we have made to it today.

Mr. Dobson

Does my right hon. Friend recall that on the last occasion that the then Postmaster-General withdrew the parcel post there were special attempts to deliver urgent medicines, to which the hon. Member for Bromley (Mr. Hunt) referred? Has he made this point in any way, officially or unofficially, to the union to see what it can do to assist?

Mr. Stonehouse

I will pursue this question so as to ensure that we do our best to deliver urgent parcels of this character. The hon. Member for Howden made a number of points about the postal services, and I want to reply to some of his questions at the outset, although I hope, if given permission, to deal with any other points at the end of the debate. He still seems to have missed the point of the two-tier system. We acknowledge that its whole object was to cut the quantity of first-class mail, because this was producing an embarrassment for us as most of it came in at peak hours and it was impossible to deal with this effectively. The system gave the public and, in particular, the business houses the opportunity of deciding what priority to put on their mail, and of sending their second-class mail in sealed envelopes if they chose. The object of the two-tier system was to reduce the quantity of first-class mail and give the public the opportunity of choice which they did not have before.

We have succeeded in doing that, and one of the reasons for the decrease in the mail dealt with since the new system came in is that the public have learned to take advantage of it. At the same time as there was a price increase—which I have acknowledged—the weight allowed was increased, a factor to which hon. Members opposite do not give sufficient acknowledgement. It was increased by two ounces to four, which has given the opportunity to many business firms to put more material in one envelope and so reduce their postage bill.

The hon. Member asked me what was the decrease in the traffic over the Christmas period. Between 13th December and 2nd January the decrease was 11 per cent., partly caused by the fact that more and more posters were putting two or even three Christmas cards in one envelope, where previously they were posted separately. That has been our experience—[Laughter.] Hon. Members may dispute this, but there is a lot of mail which we cannot deliver because of incorrect addresses, and this has to be examined. The Post Office has to open the envelopes and examine this mail to see whether it can be sent back to the sender. We have discovered a large number of envelopes with two or more Christmas cards in them, which shows that the members of the public have been able to take advantage of the higher weight allowance.

The hon. Member also asked what was the overall traffic decrease. It is down about 3 or 4 per cent. over the period from October to December, but we do not have the breakdown for which he asked between business and social correspondence.

Mr. Younger

The right hon. Gentle man has talked of finding many envelopes with two or more Christmas cards in each. Is he aware that to carry weight this argument must be backed up by comparable figures for last year? How many envelopes did he open last year and in how many of them did he find only one Christmas card?

Mr. Stonehouse

I admit that I do not open envelopes myself. I am advised by my regional directors, whose staff do this work, that it has, in their experience, been a growing practice since the two-tier system came into operation for business houses and ordinary posters to take advantage of the higher weight allowance and put more material in envelopes. This is one of the reasons why the amount of traffic, in terms of numbers of envelopes, has gone down.

The hon. Member for Howden asked how much second-class mail had been put into the first-class stream. He may be interested to know that no less than 41 per cent. of second-class mail is now being delivered with the first-class mail by the day after posting. We have, therefore, honoured the promise we gave after the two-tier system came in that there would be no deliberate delay to the second-class mail and that as much as possible of it would be delivered with the first-class mail, after priority had been given to the first-class mail. This is what we have been doing, and the hon. Member for Belfast, South (Mr. Pounder) may be interested to know that we are using the air-lift to take second-class mail to Belfast. This has materially improved the service given to that part of the United Kingdom.

The hon. Member for Howden made a number of points about the two-tier system being misleading. I take this opportunity, at the outset of the debate, completely to refute the allegation that we attempted to mislead the public. Indeed, we did our best, by extensive Press advertising and also by the circularisation of many households, to give members of the public the fullest possible details about the two-tier system. It was a pity that the two-tier system came into operation at the same time as a tariff increase. This caused a great deal of the confusion.

It would have been so much more satisfactory if it had been possible to have a straight price increase and then six or nine months later to have introduced the two-tier system. Everybody—including, perhaps, the hon. Member for Howden—would then have acknowledged that the two-tier system was a great concession, as indeed it is. But the association with the price increase was, I acknowledge, felt to be misleading in certain quarters. I regret that that was the situation. Nevertheless, I do not believe that it can be alleged with any justification that the Post Office went out of its way to mislead the public. It gave the fullest possible information about the way in which the two-tier system would work.

The fact that we have had a successful implementation of the two-tier system in the last few months, the fact that we are achieving the split in traffic that was planned—namely, 33 per cent. of first-class mail and 67 per cent. of second-class mail—and the fact that we have, until this week, been achieving the reliability of service that we promised the public are ample justification for the two-tier system and the complete refutation of the points that hon. Gentlemen opposite have made.

Mr. Eric Lubbock (Orpington)

Before the Minister resumes his seat—

Mr. Deputy Speaker (Mr. Sydney Irving)

Order. The Minister has resumed his seat. I remind hon. Members that this is a short debate and that a large number of hon. Members wish to take part in it. Sir R. Russell.

7.53 p.m.

Sir Ronald Russell (Wembley, South)

Like my hon. Friend the Member for Howden (Mr. Bryan), I do not wish to say anything which might worsen the dispute. I merely echo his remarks and' wish the Postmaster-General all success in settling it.

Will the internal telephone services of this House be affected? Obviously we shall be able to dial outside numbers from the instruments which have dials, but presumably nothing will happen when we use instruments which do not have dials and anybody who telephones this place from outside will not be able to get through. I experienced this this afternoon when I dialled the number of the House of Commons three times and got the sound of the number being unobtainable. I wondered if the strike had started already!

To prove that my hon. Friends and I have no bias against the Post Office, I wish to begin my remarks by mentioning an improvement in the service which I have experienced recently, although it is an improvement which should never have been needed and would not have taken place had I not complained.

Last summer I found that my mail postmarked "10.30 a.m. Friday" redirected from this House to me in Northumberland did not reach its destination until the following Monday morning; in other words, three days later. This happened on successive Fridays. Meanwhile, when posted on other weekdays and bearing the same time postmark, it arrived the following morning. I complained to the Assistant Postmaster-General and I am glad to say that 10 days ago I found this lapse had been rectified. I immediately wrote a note to the Assistant Postmaster-General telling him how grateful I was for the improvement. I hope that this means that mail to the North-East Coast and to other parts of the country which were affected in the same way on Fridays will continue at this normal standard, as on other weekdays.

Having said that, I come to the telephone service. Three times in the past month I have had to complain that I could get no dialling tone on my telephone at home in St. John's Wood. On the first and third occasions I telephoned, when I came to this House, the London North-West Region telephone manager's private secretary. She was most courteous and helpful and the trouble was rectified within minutes.

The second occasion was late at night when I did not think that there would be anybody in the telephone manager's private office. I trudged round to the local telephone exchange—it is the Primrose exchange—which is only 200 yards from my home and there another helpful official, who said that he was not an engineer, promised to try to rectify the matter.

I understand that no engineers are on duty late at night at this exchange. This surprises me, although perhaps it is not economic to have them available late at night. I wonder how often they are needed during the night. I hope not often. I am surprised that engineers are not available for an all-round-the-clock service. Perhaps the Minister will explain the reason when he replies to the debate.

When I returned home the official telephoned to say that he had rectified the fault, and he asked me to 'phone him back on a certain number to test the line. I got the dialling tone and several times dialled the number he had given me, but nothing happened. Eventually I dialled the operator, who was also unable to obtain the number. However, the fault on my line had been rectified.

This brings me to the question of mis-routed calls. My experience is that for at least half the calls one tries to make one does not get the correct number first time. This almost always happens when I dial "902" numbers, which is the Wembley exchange, from my home. I gather from constituents that this also frequently happens in the reverse direction, when they try to telephone me. Apparently, generally speaking, nothing happens, and one just gets that dead silence from the telephone as if the instrument has been disconnected. Sometimes one get a wrong number and on other occasions one gets the "number unobtainable" sound.

I suppose that one could be accused of mis-dialling. I remember that when the automatic system was introduced in London some years ago a lady complained that she could never get through to numbers on the Holborn exchange. An official went to her home and asked her to dial a Holborn number. He found that she was dialling "HOB" instead of "HOL". I try to dial deliberately and firmly and to pause between each number, yet even that does not seem to produce the right results. I should like to know why this happens. Is the equipment in the London area old and does it need renewing, or is there a shortage of maintenance engineers so that it cannot be kept up to scratch?

If I dial my son's number in Seaford, Sussex, from home, after a slight pause I always get the ringing tone straight away. That seems amazing when I cannot do it in London. In other words, subscriber trunk dialling seems to be more effective than dialling inside a local area.

Similarly, in Northumberland, with limited dialling facilities in local exchanges, I usually get results first time. Again, why is this? Why should it be easier in some parts of the country than in others? The equipment in the London area is, presumably, in much greater use than equipment in other parts of the country, although there is, no doubt, more equipment which can go wrong in London than in, say, Northumberland. Presumably, also, it is maintained more frequently in London than at isolated country exchanges.

I hope that when the Minister replies to the debate he will be able to explain these difficulties and reassure us that the technical side of the service will be quickly improved. I am sure that in many instances, at least in the London area, it is far below the standard of other countries and far below the standard it ought to be.

8.1 p.m.

Mr. R. F. H. Dobson (Bristol, North-East)

I want to say a few words about the general pattern of services in the Post Office and to refer to the speech of the hon. Member for Howden (Mr. Bryan). I wish to spend most of my few moments in this short debate, however, talking about the overseas telegraph operators' dispute. I have a number of questions to my right hon. Friend the Minister about various aspects of the dispute which I hope he will feel able to answer at the end of the debate.

What was so disappointing about the Opposition's attack, if that is the right word for it, was that the principal Opposition spokesman for Post Office matters once again refused to be drawn about denationalisation of the telecommunications services, which have featured so prominently throughout our debates in Committee upstairs on the Post Office Bill.

When this matter was raised in Committee on 21st January, the hon Member for Acton (Mr. Kenneth Baker) said: This is a very important Amendment, because it would allow the denationalisation of part of the Post Office—the telecommunications side. At the end of the short discussion on the Amendment, the hon. Member for Howden said: On this Amendment no name of a member of our Front Bench appears, so I rise now to assure the Committee that my hon. Friend has our support in his Amendment."—[OFFICIAL REPORT, Standing Committee D. 21st January, 1968; c. 393, 406.] If that does not mean in clear terms that if the Tories came back to power they would denationalise the telecommunications services of the Post Office, I do not know what does. It is a clear indication of their view of the Post Office services.

What is so shameful of the Opposition Front Bench spokesman is that he withdrew that and coyly said at the next meeting of the Committee that he and his colleagues were not sure about this until they got back into power, if they ever did—and goodness help those in the Post Office if ever they do—when they would have to prepare a list of priorities. The hon. Member would not be drawn beyond that.

In a debate on the Post Office, when dealing with the sort of Motion which is before us tonight, I hope that the hon. Member for Belfast, North (Mr. Stratton Mills), who has strong views on this subject, will be much more forthcoming. I hope he will say precisely what the Opposition would do to the telecommunications services, how they would denationalise them and how speedily they would do so if anything drastic should happen and they were, unfortunately, returned to power.

Mr. Nicholas Ridley (Cirencester and Tewkesbury)

Before the hon. Member castigates the Opposition for not saying what they would do if they were in power, which they are not, may I ask whether he has ascertained from his own Front Bench colleagues whether they intend to nationalise the docks? I am incapable of doing so.

Mr. Dobson

If the hon. Member will restrain himself until the day after tomorrow, there will be a White Paper which, I hope, will make it astonishingly clear. I shall be in favour of nationalisation of the docks, as I am in favour of not denationalising the Post Office.

I take issue with my right hon. Friend the Postmaster-General on a few things that he said about the Post Office overseas telegraph operators' dispute. He said that the rest of the staff were not involved. That is not so. The rest of the staff are involved in the principles of this dispute. It is an important dispute, as I shall try to demonstrate yet again, because I believe that it has been done adequately in all the discussions which have been held between my right hon. Friend and members of the union concerned. I want to show my right hon. Friend once more just how important it is and why the rest of the staff of 200,000 working in the Post Office are prepared to support this small number of 3,500 operators. They are prepared to support them because of the very deep principles involved in this type of dispute.

I should have thought that what the Postmaster-General has offered so far has not met with the approval of the union. The claim of the operators is the very simple one that they will take the 5 per cent. which has been paid to all other staffs in the whole of the Civil Service and all the staff of the Post Office and then negotiate the rest of the productivity bargaining in the appropriate way and with as much speed as they can. I will return to that presently.

On Thursday every hon. Member received in his post a statement from the unions which is called "Telact No. 1" and headed" A strange strike ". It could equally have been headed "A needless strike", because if some of the things about which the union were complaining had been looked at sufficiently early and clearly, the chances are that we would not have been involved in this dispute. It is no pleasure for me to stand here knowing that there is a dispute in which other members than myself happen to be involved, because I happen to be a member of the union. I want to see an end to the dispute as soon as possible.

Three things come out in that document. The first is that long and patient negotiations have gone on for over seven months. Secondly, as with all industrial disputes, it is a complicated issue. All strikes are complicated issues, but there are one or two fundamentals which I hope to illustrate. Thirdly, as was amply demonstrated by what my right hon. Friend said, there are still specific differences between him and the Union of Post Office Workers. If in some senses they are not very wide, they are certainly deep. I want to plumb some of those depths tonight.

The issues were set out clearly in a letter to The Times this morning by the General Secretary of the Union of Post Office Workers, Mr. Tom Jackson, which showed three things in particular. First, there has been a two and a half year delay—this is one of the underlying causes—in the settlement of the 5 per cent. pay increase, which has been paid to 800,000 other civil servants and yet denied to these 3,500 overseas telegraph operators. Every other person in the Post Office represented by the union has had, without strings or anything else attached to it, the 5 per cent. increase which was part and parcel of the agreement for the whole of the Civil Service.

There was no other section which had anything saying, "You must have this in or that in or take this out or that out." They were all on exactly the same basis, a 5 per cent. increase. I have three questions to put to my hon. Friend the Assistant Postmaster-General. First, which of the Civil Service agreements have a productivity bargain tied to them? Second, how many other civil servants are waiting from 1st January, 1966, for a settlement or are these the last 3,500? Thirdly, and most important, why was the offer to take 5 per cent. only and negotiate the rest refused, when it was made to the other civil servants concerned?

The second point that Mr. Jackson makes in his letter is to do with the refusal by the Post Office to cost productivity measures, such as were proposed on a local basis. This has been done on the postal and telephone side, if not completely, then certainly negotiations are proceeding and there is no reason to think that they will not be successful. The method of working in these two categories, the major portion of the Post Office, is that the local costings on productivity bargaining are measured up and sent for national discussion and distribution. This is all that is being asked for in this settlement—that a local, properly based costing exercise on productivity measures should take place in Electra House, which is where the dispute is, and then sent to national headquarters for it to determine the disbursements of the savings flowing from it.

In other words, all that the union is seeking is exactly what happens to the other 200,000 people involved in the other discussions. Local staff are involved with local productivity discussion and then it goes up to national headquarters. Is not this part and parcel of what Donovan said in his Report, that the idea was to get local plant bargaining? This is along these lines and it is a sensible way in which we can improve some of our industrial difficulties. It would certainly improve this one.

Does the Postmaster-General agree that local costing figures quoted so far are only estimates and not agreed locally? Does he understand the difference between an estimate of what might happen, which can be fairly accurate on some occasions, but grossly inaccurate on others, and something which has to be talked about in detail, locally, as it needs to be in an exercise of this kind? Because a pay research document is involved in this, can he also say how the pay research document on which this offer is apparently based, can be said to contain … an element of productivity bargaining "? It did not even evaluate the jobs which are now in dispute locally in Electra House. Until he really answers this question honestly I cannot see that he will ever get to the position where he understands the union's case.

The third issue brought out in the dispute is the introduction of measures which will reduce staff and their take-home pay. The history of staff relations in Electra House is of a difficult period, and I have been involved in it personally for a good few years. There have been staff shortages there so grave that on occasions no one really knew what the proper number should be. No one dared to make a figure because they did not know whether it would reach the correct figure when the staff were totted up. For many years the building has suffered from a staff shortage of a grave kind. This is because of many things, poor wages, bad working conditions, particularly bad in some sections, and social hours—24 hours a day and a lot of weekend work.

Most operators, over a period, lost rest days on a regular basis. The office has been subject to sustained and heavy overtime. All these things add up to a staff which expected to take home a more-than-average pay packet to make the job worth while. If they did not they went home and did not do the job. The introduction and reintroduction of the measures which my right hon. Friend is insisting on inside this bargain of 2 per cent. save in all a very substantial number of posts, 350, and it saves the Post Office something like £250,000 in wages, a year. This is a very fine thing to do, to which no one would object. But if it is done in an area where one wants to make productivity bargaining work, and use such bargaining as a method of assessment of wages, one has to look farther than actual savings of wages. One has to see what happens.

In this case, the Post Office seems to be arguing that an introduction of this type of saving cannot be used to keep up the average take-home pay of the operators concerned. My right hon. Friend must know that this has been made quite clear in certain reports from the Prices and Incomes Board, which have had clear Government approval. We have had a series of reports—P.I.B. Report 51, Cmnd. 3499 on Atomic Energy Workers, P.I.B., 8, Cmnd. 2873 on the Railway Staff, P.I.B. 42, Cmnd. 3405, on the Electricity Supply Industry wages, P.I.B. 17, Cmnd. 3019 on the Baking industry, P.I.B. 36, which I am holding in my hand, Cmnd. 3311, dealing with productivity agreements.

Page 46 of that Report, at paragraph 207 says: The prior planning and conclusion of the agreements has given management more effective control over the performance of work, while at the same time, through the consolidation of overtime and other payments in total earnings, it has given the employee? greater security of earnings. Is this not the point at issue over the 2 per cent? It is exactly the point. Here is the P.I.B. Report, not just a selective report, but one dealing with productivity agreements, making it quite clear that this is the sort of thing that the Government want to see. This is precisely what the union is arguing for. If I wanted to be naughty, I could go on to say that in paragraph 209 it says: We believe that the advantage lies with point discussions on principles before the presentation of formal policies … and not subject to arbitration. If my hon. Friend cannot understand that, or has been persuaded that this is not representative of Government policy, I am absolutely astonished.

This strike is not a dispute over Government policy. Clearly, 5 per cent. is in line with Government policy. The argument that the union wishes to pursue on productivity bargaining is in line with Government policy, absolutely and utterly. Why cannot the union go to arbitration? Why cannot the union look to the other forms of arbitration suggested? In The Times letter, Mr. Jackson makes this clear. He says: … an arbitrary decision is the worst possible way to introduce productivity bargaining. He is right. Under normal circumstances if this was a normal pay claim, there would not be much argument, about having to go to arbitration. But when one is dealing, as in this case, with a productivity bargain, one must not allow, certainly in the first one that ever happens in a particular sphere, a Civil Service arbitration tribunal which has no experience of this, or any other tribunal, to judge, in this arbitrary way, the productivity bargain. I am sure that has been made clear to my right hon. Friend the Postmaster-General and my hon. Friend the Assistant Postmaster-General on many occasions.

I want to remind my hon. Friend that this grade, the overseas telegraph operator grade, is on the verge of technical changes of some magnitude. How can we expect the staff and local people concerned to understand that they should not object to new procedures and new technology if, on the first occasion that one tries to introduce such procedures, one refuses to recognise their legitimate claims to proper bargaining at local level?

Secondly, and most important, there will be substantial changes this year and, indeed, over the next few years on the postal side, when postal machinery will be introduced and will displace postal workers. Nobody wants to stop this process, but if it cannot be carried out on the basis of proper productivity bargaining but at the same time on the basis of the depletion of earnings, my right hon. Friend can whistle in the wind if he wants to introduce new equipment.

The union's position is absolutely clear. Its members will accept 5 per cent.—not the 7 per cent. which seems to be on offer. Then they want an opportunity properly to negotiate productivity bargaining for this grade. I am sure that if the Postmaster-General made such an offer we would stop this silly dispute.

8.22 p.m.

Mr. Kenneth Baker (Acton)

May I say at once how pleased I was, and I am sure how pleased all hon. Members were, to hear that negotiations had started between the Post Office and the union to end this dispute.

I was also a little surprised to hear the Postmaster-General say that there had been no dispute between various Ministers. The newspapers yesterday, this morning and this evening contain stories of a rift between Ministers. On the one side was the Postmaster-General who was prepared to negotiate, which is a sensible position, and on the other side was principally the Secretary of State for Employment and Productivity. It appears that when the Postmaster-General said, "Can I negotiate?", the right hon. Lady replied in the words of the old song, "Oh, no John, no John, no John, no". I am very glad to hear that this is a complete fantasy of the newspaper world and that there is not a rift.

Mr. John Page (Harrow, West)

I think we ought to have clarification from the Assistant Postmaster-General as to whether my hon. Friend is right and whether negotiations are in progress between the unions and the Postmaster-General. I understood that the Lord Privy Seal was acting as chairman at a discussion at which the Postmaster-General was present.

Mr. Baker

There seems to be a collective responsibility for the Post Office these days. Every Minister chips in if he thinks he has got a point to make.

I return to the Motion, which is a criticism of the deteriorating services of the Post Office. Everybody living in the United Kingdom comes into contact with the Post Office nearly every day of his life. Therefore, it is not surprising that this is possibly the most sensitive area of the Government machine. It is always subject to many complaints, but there is also no doubt that the volume of complaints has increased considerably in the last few months.

The main reason for this is the reason which was mentioned by my hon. Friend the Member for Howden (Mr. Bryan), that in the last four years we have had four chief executives in the Post Office—four Postmasters-General heading one of the largest industries in the country. It would be surprising if an industry which changed its chief executive four times in four years and three times in the last 18 months was efficiently managed. Morale is low. The reason is that the Government look upon the post of Postmaster-General almost with contempt and scorn, either as an ante-chamber for those who are amorous of a political future, or as a condemned cell for those who are making their last political farewells. When they look at the chief post in the Post Office in this way it is only natural that morale in the Post Office should be low, and that Mr. Grady, who was responsible for establishing the Giro system, threw in his cards and joined a merchant bank.

Services have deteriorated or at least have not improved. Take S.T.D. telephone calls. In 1963 the failure rate for calls which just did not get through was 8.2 per cent. Last year the failure rate was 8.1 per cent. There has been no improvement at all in the reliability of the telephone services in five years. Take again the telephone waiting list. When the Conservatives went out of office the waiting list was just over 40,000. Today it is in the region of 100,000. [Interruption.] I accept that a few months ago it was even higher and that it is now coming down. I will tie this up later to an argument on the capital expenditure of the Post Office.

The fact that the waiting list is increasing is nothing to be proud of. In no other country is it getting bigger and bigger. The waiting list is being reduced, I think, by rather questionable methods. In a large part of my constituency of Acton, anyone wanting a telephone cannot get a separate line and has to take a shared line. I thought that shared lines were a thing of the past and that none of us would be prepared to accept shared lines. In the whole of South Acton any constituent of mine who wants a telephone has to have a shared line.

Let me now turn to the postal service. The Postmaster-General is complacently proud of the mess that the two-tier system has left us in. Before that system was introduced, 60 per cent. of our mail went first-class. Of that 60 per cent., 92 per cent. was delivered the next day; in other words, 55 per cent. of all letters were delivered next day. Now only 33⅓ per cent. go first-class, and of that amount 94 per cent. is delivered next day, namely, 30 per cent. Here is a real drop in standards, from a next-day delivery rate of 50 per cent. to a next-day delivery rate of 30 per cent.

The other disappointing feature of the two-tier system is that the Post Office management estimated that the fall in consumer demand would be about 2 per cent. Yet only 10 days ago we learned that the fall in consumer demand since last September has been about 4 per cent. So the estimate was 100 per cent. wrong. The consequence is that the extra revenue to be raised from the two-tier system will fall from £25 million to £21 million, a drop of £4 million. That figure is highly significant, because the profit made by the postal side of the Post Office last year was £4 million. When the Postmaster-General winds up tonight, perhaps he will give a forecast of how the profitability of the postal side will be affected this year. Is it possible that as a result of declining traffic it may run into deficit again? I sincerely hope not.

The lowering of standards, while never acceptable, would at least have been tolerable if it had not been accompanied by a rather bright and breezy advertising and public relations campaign which implied that everything was well with the Post Office. One of the present Postmaster-General's first acts on taking office was to change advertising agents. I do not quarrel with that decision, but, having decided to shoot the pianist, the right hon. Gentleman should have changed the tune. The present advertising and public relations campaigns of the Post Office is still set in the complacent optimism of last year. One of our greatest criticisms of the Treasury Bench is that we can detect no sign there of the slightest realisation that all is not well in the Post Office. Inertia seems to reign, and there is no sense of urgency—just a resigned acceptance of second best:

Mr. Ridley

Is it not rather 0dd that at a time when we are asked by the Postmaster-General not to telephone or to send letters or parcels the Post Office is still issuing advertisements advertising services which it cannot provide?

Mr. Baker

That is so. There is no flexibility in the advertising programme—my hon. Friend has made the point—and it betrays a complacency on the part of the management of the Post Office which is most depressing.

Hon. Members opposite will say that it is easy for us to criticise the Post Office, that letters go astray and telephone calls do not always get through. In my view, it is up to the Opposition to put forward a concrete plan showing what we would do to improve the services. I believe that the answer lies in a massive injection of capital investment.

The Postmaster-General has said many times—I want to be fair to him, and I acknowledge this—that the present Post Office capital programme is the largest capital programme ever undertaken. It is simply not enough. Last year we spent about £291 million on telecommunications capital equipment, and this year we shall spend about £334 million. In America during the same period ten times as much is being spent. America is a bigger country, but it is not ten times bigger, and its population is not ten times ours. Moreover, the American telephone system is much more developed than ours. It penetrates to 85 per cent. of homes, whereas ours penetrates to only 25 per cent. of homes.

In order to catch up, a massive investment programme is required, much larger than the £2,000 million at present invested.

The Assistant Postmaster-General (Mr. Joseph Slater)

Does not the hon. Gentleman agree that there was under-capital-isation by his own Government? If there had been greater concentration on Post Office requirements during their period of office, there Would not have been the situation which he now alleges exists.

Mr. Baker

That is typical of the negative attitude of the present management of the Post Office. It is no good looking to the past and bemoaning the under-capitalisation of the past. We have to look to the future and be determined that it shall not occur again. The telecommunications side of the Post Office should be spending £500 million or £600 million a year in capital investment. It is unreasonable to expect any Government, Socialist or Conservative, to find that investment. This is why the Post Office should put itself in a position to be able to tap the private capital market, as is done very effectively in America. My Amendment in Committee has been referred to already. The Post Office ought to have that power. Unless there is a massive injection of new capital, we shall inhibit the growth of the Post Office and its true potential.

1 remind the House what the Prices and Incomes Board said: In spite of the capital programme of which the Assistant Postmaster-General is so proud the United Kingdom will still lag behind many other countries, and in 1971 both telephone penetration and usage will still be below that already existing elsewhere". There is an undoubted case for a massive programme of investment in the Post Office. It must compete with other urgent social needs—schools, hospitals and roads—and that is why the Post Office should take powers to tap the private capital market in order to develop this great service to its full potential.

8.35 p.m.

Mr. Raphael Tuck (Watford)

I want to declare first that I have no interest except to see that the catastrophic strike of overseas telegraph operators goes on no longer than it need. I am naturally glad to hear that there is an increase in the number of Christmas cards posted, though I have now no connection with the firm that bears my name.

I have not been briefed by the Union of Post Office Workers, but I have had interviews and meetings with some members, particularly one of the overseas telegraph operators, and I can say that they did not want the strike to occur. They want to bend over backwards to stop it; and they turned somersaults to see that it did not occur.

My right hon. Friend the Postmaster-General said that there was no clash of views in the Cabinet. I accept that, though I should not have expected him to say that there was a clash even if there had been. However, I do not believe that the members of the Ministerial Committee of the Cabinet know very much about what is going on in the Post Office, particularly one or two of the facts I want to put before my right hon. Friend and the House now.

Last year, or thereabouts, out of 425,000 workers in the Post Office, all but 3,000 overseas telegraph operators received a 5 per cent. pay increase. They have now been offered that pay increase, with two strings attached. One concerns the Revised Revision, whereby telegrams might now be checked only three times instead of eight, effecting a saving in expenditure of about £270,000 and a reduction of 183 in the staff. The second string is that the Overseas Telegraph Relay Unit is to be reintroduced, and with reference to that the workers have been offered nothing.

It has been estimated that the saving to the Post Office on the O.T.R.U. will be about 2 per cent., but the overseas telegraph operators do not think that it has been costed. A rule has been accepted by the Post Office that if a reorganisation involves a reduction in staff and a saving to the service the workers concerned will receive a proportionate benefit. The overseas telegraph operators want this costed properly, pointing out that when the multiple relay unit, the M.R.U., was introduced some time ago the Post Office said that it had been costed, and gave a certain figure which they said the workers should receive. The workers said that it had not been costed properly and went into seven months' costing. They told the Post Office, "This is our costing. You were wrong." The Post Office went into it, and had to admit that they had been wrong and that the workers were right. Therefore, the overseas telegraph operators say that if this has not been costed properly it must be costed now. The figure of 2 per cent. might turn out to be much more, or it might be less, but they are willing to take what comes out of that costing.

On the reintroduction of the Overseas Telegraph Relay Unit there will be a saving of 167 personnel out of about 2,000, which is 8 per cent. The Postmaster-General says, "Let them go to arbitration". But the overseas telegraph operators say that the arbitration tribunal has stated that it has never had this kind of thing to decide before. The first thing that it would have to decide would be whether, on an award not based on productivity, strings could be attached based on productivity in another sphere. It has no guidelines on which to proceed.

The overseas telegraph operators say that they would be willing to accept a 5 per cent. award now, with no strings, and to guarantee that they would meet Post Office officials and cost the Revised Revision properly. I ask my right hon. Friend the Postmaster-General to consider whether that is so unreasonable. They are willing to meet round the table, go thoroughly into this costing, and enter into a productivity agreement based upon it.

Again, the Post Office has said that when O.T.R.U. was previously introduced a productivity agreement was reached, and to arrive at another productivity agreement would be having two bites at the cherry. Whether or not that is so, the productivity agreement arrived at before the introduction of the multiple relay unit was of a different kind. The reintroduction of the overseas telegraph relay unit would result in a saving of 8 per cent. of the overseas telegraph operators and they should be in receipt of some, but not all, of that benefit.

It has been said that the prices and incomes policy should govern this matter, but the overseas telegraph operators sent a telegram to the Secretary of State for Employment and Productivity asking her to intervene. A telegram was received from her stating that she had no power or authority to intervene. What is the use, therefore, of going to the Prices and Incomes Board?

I know my right hon. Friend is making every effort to end the dispute. I ask him to place these considerations before his Cabinet colleagues, who, I believe, do not know the issues involved, and whose views are perhaps not the views which the right hon. Gentleman privately holds, although I will make no further comment on that.

8.42 p.m.

Mr. John Page (Harrow, West)

It is no pleasure for an hon. Member to criticise the great public undertaking of the Post Office and it is extremely sad to have to remark on the deterioration of the service which it is now giving.

As I said in the debate on the two-tier post, much of the blame lies upon the Postmaster-General and not on his staff. I will not go over the old history, but I was disappointed when the right hon. Gentleman at the end of his speech beat his breast and said that he had never tried to mislead the public. At two Press conferences he said that it was not the intention to blackmail the public into using the 5d. post, and that the 4d. post would not be unnecessarily delayed. Those of us who went to the trouble to see, saw that both those undertakings were being patently disregarded. We saw piles of 4d. mail which could have gone out with the 5d. post, being held. Had he said that in due course the Post Office would try to deal with the second-class mail at the same time as the first-class mail, that would have been more acceptable.

The Post Office is a great business, and any business, particularly one that sells a service, depends on good will. Those of us who know anything about business realise that goodwill is easy to lose and difficult to build up. The attitude of the people towards the Post Office has taken a very sad turn. They are dissatisfied with the service which they get and are constantly critical of it. The Postmaster-General may say that because they start being critical about one aspect of the service, they later turn their criticism to other aspects, but that is what good will means. If a firm has good will, its faults are not emphasised and perhaps magnified as might otherwise be the case.

The present strike underlines the un-suitability of the Government as an employer, especially a Government who have on the books a Prices and Incomes Act designed to depress wages for those who apply for increased wages. It is particularly ridiculous that the Government should issue a White Paper setting up a new commission on industrial relations which will not have to take into account in its recommendations the criteria about productivity which the Prices and Incomes Board has to follow.

The hon. Member for Bristol, North-East (Mr. Dobson) spoke about the previous productivity agreement. It is amazing that the First Secretary and her Department have no means of checking whether productivity agreements, made before a new pay award is permitted by her, result in extra productivity. That underlines the absurdity of the situation.

I entirely agree with everything said by my hon. Friend the Member for Wembley, South (Sir R. Russell) about the telephone service from Wembley. The two areas are close together, and very much the same comment applies to calls into and out of the Harrow area. Many of my constituents complain that they frequently dial and get no response—just a dead telephone. They also get many wrong numbers when dialling. I have never understood how the Postmaster-General can quote the number of misrouted calls. Presumably they are regarded as misrouted only if they are reported. Most people are too busy to report a wrong number or a misrouted call.

I therefore ask him whether and at what stage it is possible to record a wrong number. Is the subscriber, immediately has has had a wrong number, supposed to dial 100 and to report it in order that his money may be refunded, or can he make a report later? Can he lump together a number of wrong numbers which he has received and deduct that amount from the telephone bill at the end of the period?

Mr. John Mendelson (Penistone)

Send a telegram to the Postmaster-General.

Mr. Page

I understand that it is not possible to send a telegram to the Postmaster-General and to mark it "Collect".

I wonder whether there could be an automatic answering service, which is not engaged, so that it was possible to report a wrong number without having to wait for a long time, as is often the case when dialling the operator. I have to record with some regret that there seems to be a slowing of the telephone service within the House. I do not know the reason. It may be advancing age and advancing impatience with the Government. I seem to wait longer each time I pick up the telephone before getting a response. When one questions why one has had to wait, the answer always is, "We are imposibly busy and overloaded". I understand that the telephone exchanges in the House are old-fashioned. What does the Postmaster-General propose to do about them?

Mr. Eric Ogden (Liverpool, West Derby)

In fairness to the staff here, who are workers, like ourselves, would the hon. Gentleman compare the service which we get here with the service which one gets on any other private enterprise switchboard in the country? Would he agree that there is a technique of dialling or asking for a number? Perhaps my right hon. Friend the Postmaster-General would issue a guide to hon. Members telling us how we might get the best and most efficient service from the staff, who already give us a very good service.

Mr. Page

I do not think that my approach in the House is any different from my approach outside. I am referring not to the dialling lines in the House but to the many telephones which one picks up but does not get a reply. If the hon. Gentleman has a suggestion about how Members might improve their telephone technique, I would be the first to try to adopt it.

I greatly approve of the new method used when one contacts directory inquiries. The operator says, "State the name of the town for which the number is required", or something like that. This usually induces a better response from the caller. I regret, however, that many of the young ladies in London, although not in Scotland, who have to make the search, find it more difficult to deal with the inquiry than I should have thought was necessary.

1 turn to the question of public call boxes. It is still hardly worth while, when one is driving to an appointment and one is late, to park the car and go to a public call box, because so often it is not working. Is there not a way to improve security? This must be something about which the Postmaster-General is worried. It would be helpful if an alarm bell on the box rang when it was being tampered with.

I come to the final nail in the coffin of the Postmaster-General's skill in public relations, namely, the issuing of the new long 5d. commemorative stamp of the QE2 on 15th January when delivery of the ship, through no fault of the Postmaster-General, I hasten to add, has not yet been taken. Even if it had been announced, I should have thought it possible for the right hon. Gentleman to save the acute embarrassment of anyone receiving a letter with this stamp on by postponing its issue until the ship had sailed and started to be the success which we all hope and I believe she will be.

8.54 p.m.

Mr. John Mendelson (Penistone)

We can always rely on the hon. Member for Harrow, West (Mr. John Page) to provide some unintended light relief in a serious situation. The House will again be grateful to him on that account tonight.

The number of points made in the paucity of argument displayed by hon. Members opposite which perhaps have some merit has been reduced to two. One concerns investment. Some hon. Members opposite who have spoken have been Members for such a short time that they do not know the grave neglect of the Post Office for which their party was responsible over many years. Year after year, when we were on the benches opposite, hon. Members on both sides of the House, some of whom are not Members any more, urged the Government to provide proper capital investment for the Post Office. On other occasions we heard propaganda speeches and public relations outfits telling us how well the Tory Government were doing when year after year, in secret, they were postponing the necessary investment in the Post Office without telling the House. That is the background to all Post Office debates, and it takes the effrontery and ignorance of younger hon. Members to talk in the way that they have tonight. The hon. Member for Howden (Mr. Bryan) has no such excuse, because he was here. In his case, it is blatant hypocrisy, and I admire his blatancy.

The only other point of any merit referred to the technical difficulties. It was raised by the hon. Member for Wembley, South (Sir R. Russell) an hon. Member who has been greatly respected in all parts of the House for many years. He knows what he is talking about, and, quietly, he raised a number of detailed points which are technical in character but not unimportant. I will not go into them, but I hope that my right hon. Friend will accept that those technical points are of great concern to many users of the Post Office services. Knowing my right hon. Friend as I do, I am sure that he will take due note of what the hon. Gentleman has said. Many hon. Members on this side of the House could make similar points from their own experience. They are matters which must be taken seriously.

My main purpose in intervening briefly in this debate concerns the serious dispute taking place at present. I welcome the fact that my right hon. Friend has given a detailed outline of what happened this afternoon and earlier this evening, so bringing us up-to-date. When he did not choose to make a statement earlier today, I knew for sure that he intended to make one later when he could give us more information.

What he has said is inadequate as a statement of Government policy. In spite of his emphasis that he takes the same view as all other members of the Government and stands by what the Government feel about the matter, he must forgive me if I remind him of what we used to say when we were in opposition and were in the habit of going home together: All Ministers are equal, but some are more equal than others. Those words apply to the present situation. It is important for my right hon. Friend to remember that the public expects him to take a stand on behalf of those employed in the Post Office. That cannot be the same as the stand taken by the Chancellor of the Exchequer or any other member of the Cabinet. My right hon. Friend has the task not only to safeguard our postal services but to see that fairness is applied to those whom he employs.

I come now to the only point that I intend to make about the dispute. It would be impertinent for anyone not as closely connected with it as my hon. Friend the Member for Bristol, North-East (Mr. Dobson) to make any detailed survey of the situation, so great was the clarity and knowledge with which my hon. Friend spoke.

The important point is the one that I raised last Monday afternoon, when my right hon. Friend made his first statement about the dispute. I urged him to see whether the Government could not apply to the dispute the procedure that was applied in the railway dispute, which was an equally difficult one. Some months have passed since that dispute, and it may be that we have forgotten the bitterness felt by many railwaymen at the time. The assistant general secretary of the footplatemen's union made a public statement on the first Monday of that dispute in which he said that a compromise agreement might be reached if negotiations were to take place in the direction of reaching an interim pay settlement, leaving the rest of the negotiations, including productivity matters, to further discussions in private. On that same Monday I made this suggestion to the Government. The Ministry of Transport said that it was listening carefully but could do nothing about it. A whole fortnight was wasted. At the end of that time the negotiations were concluded precisely on the basis that the assistant secretary general of that union had proposed. The same agreement could have been made within the first three days.

I, therefore, urge the Government not to be too rigid. The two additional proposals that my right hon. Friend has reported to the House tonight do not go further in any substantial respect than what he has said before. They repeat, in other words but with a slight amendment, proposals already made.

It is clear from the carefully worded letter of the General Secretary of the Union, Mr. Jackson, which appeared this morning, that this matter is similar to the railway dispute. Mr. Jackson, in substance, is arguing that there is disagreement on the arrangements that ought to be made about a productivity agreement. That was the precise situation in the railway dispute. What was needed then is needed now—a quiet period of discussion away from the glare of publicity. It is not for me to make suggestions about arrangements which might finally be made—that is for the people who know the job and are directly involved—but my right hon. Friend and the Government must find a means of conciliation which will allow these discussions to take place.

We have had no reply so far from my right hon. Friend, or from any other member of the Government, why it is not possible at this stage to accept Mr. Jackson's main proposal to make an interim payment and then to go on, in detailed private discussions, to look at all the other matters concerned. Why must the Government insist on tying the payment of the 5 per cent. increase to the immediate payment of the additional 2 per cent.? Arbitration is no answer. What is needed is an agreement similar to that in the railway dispute which, as my hon. Friend the Member for Bristol, North-East has pointed out, will create maximum good will at the point where the agreement is concluded, so that the two sides can go into the application of productivity arrangements in the best possible atmosphere. My right hon. Friend has not said tonight why the Government must be so rigid in insisting that we do not want an interim agreement paying the 5 per cent., or some such figure.

My right hon. Friend was very aggressive about the fraternity of journalists in telling them that they were engaging in wholly unfounded speculation, but I want to put in a word for the Press. After all, when a Government have for some years been engaged in argument about their prices and incomes policy, which forms the background to every industrial dispute that takes place at the present time, surely free journalists have the right to make their point about the possibility of some senior Ministers taking a different view from that of my right hon. Friend. There is nothing journalistically illegitimate in writing about these matters. Moreover, another point is involved. This is part of the public service, and it is well known that my right hon. Friend the Chancellor of the Exchequer has a particular interest in all matters of pay and conditions concerning the public service. It is also clear that in disputes of this kind there is a political aspect. I, therefore, invite my right hon. Friend not to be so vehement when he deals with the reports and suggestions which have appeared in the Press. What senior Ministers feel about disputes of this kind is a legitimate business of public debate.

1 close by reminding my right hon. Friend that I do not propose to lecture him on social justice and how to deal with the rightful aspirations of trade unionists. We have been colleagues together for many years. My right hon. Friend has known, and still knows, about these matters at least as long, and as well, as I have. But there is grave concern that time is again being wasted, as in the railway dispute, because people are acting too rigidly. We look to my right hon. Friend, as the representative of the people employed in the Post Office and the custodian of peace in the enterprise, to be firm with his own colleagues, and courageous. He should know that he will receive the applause of many of us if he acts in that way.

There is no good reason that the House or the country has heard why there should not be new negotiations tomorrow morning. No matter what transpires this afternoon, my right hon. Friend should call the two sides together again and say, "Let us make an interim agreement on pay and then have a quiet period of discussion, and then, perhaps, fix some such date, as in the case of the railways, four or five months from now, during which time we will come to a new agreement." If he acts in that way he will deserve the applause of all of us. If he does not—and if, because of the rigidity of the Government, the chance is missed—he will assume a very grave responsibility.

9.6 p.m.

Mr. Tom Boardman (Leicester, South West)

It was inevitable that the subject of this debate should be overshadowed by the statement made by the Postmaster-General on this unfortunate dispute. This has taken a great deal of time of hon. Members on both sides of the House. I welcome the statement of the Postmaster-General, and I am glad that he made it straight away. I particularly welcome his action about pensioners in cities such as Leicester, because this matter has caused concern to some people in those cities. I welcome the prompt way in which this matter has been dealt with and announced. Unfortunately, it has reduced the amount of time during which we are able to debate the deterioration of the postal services.

Listening to the arguments of hon. Members opposite it would seem that the labour dispute has resulted from—in their words—bad management. If that is right, the same cause can be attributed to the deterioration in postal services of which we complain. The debate on the dispute that is now taking place has also opened up questions of industrial relations, and some of the remarks made tonight may be relevant to our discussion of the question of procedural agreements being made binding. Such a question would be relevant to the issue before the Postmaster-General at the moment.

The deterioration in postal services stems, in large part, from the confusion—I concede that it is partly historic—of the three arms of the Post Office, namely, its Royal Mail Service, its telecommunications service and its postal counter service. These are three quite distinct services, but they are confused, both in their accounts and, very often, their treatment. As has been said in Committee on the Post Office Bill, as well as in the House, these three arms should be segregated and given different treatment.

The low point of the postal services has been the two-tier system, about which much has already been said today. The Postmaster-General implied that the criticism is dying down. If so, it is only because people are becoming tired of complaining or—worse still—because they have forgotten the former speed and reliability of the service and have, in the words of the song, "grown accustomed to her face".

If this were so it would be unfortunate, because the service can in no way be claimed to be comparable with that which was given before, taking the mail overall. As we have heard, 94 per cent. of first-class mail is now delivered the next day. As my hon. Friend the Member for Howden (Mr. Bryan) said, it used to be 93 per cent. of all ordinary mail. The Postmaster-General says that there is a choice, but the choice amounts only to the fact that by paying more one stands slightly over 1 per cent. better chance of one's mail being delivered the next day—or by paying the same, one is nearly certain that the mail will be delivered 48 hours later.

But my main criticism of the deterioration of postal services is the effect that they are having on business efficiency. This is not just a matter of delays but can also be seen in the earlier closing of Post Offices. The Post Office in one provincial town used to close at 6.30 about two years ago; then, it was 6 p.m. and now it is 5.30 p.m. People with franked mail can deliver it only when the Post Office is open, which means that mail which used to arrive shortly before 6.30 now has to get to the Post Office just before 5.30. Allowing for signing the letters and getting them franked and bundled up, the working day in most firms must stop at 4.30. An enormous amount of business and commercial time has been lost by this one act of closing earlier.

The right hon. Gentleman may say that people can get on with the next day's work, but we know that this is difficult in practice. It is rather like a Press deadline. The deadline for an office is the time when the mail has to leave to catch the post. This is one more complaint on top of those already mentioned. I am not averse to change or experiment—I welcome it—but it should be carefully planned and all these factors should be taken into account.

We are missing great opportunities in telecommunications. There was never a time when it was more vital to harness the great skills and inventiveness of industry so that we can provide the telecommunications service which we need. We shall not get that, however, in the present position of the monopoly buyer with the powers which the Post Office Bill will give him. People will not take the risks and supply the skills or techniques or invest capital in research when there is one buyer with powers to compete with the supplier and take him over or subsidise his competitor with public money.

This is not how the American system has thrived: quite the reverse. I beg the right hon. Gentleman to think again on this. The present proposals are a great deterrent and opportunities are being lost. His attitude to private capital in the postal services is a strange one, but it was exposed in Standing Committee recently. Referring to the speech of my hon. Friend the Member for Acton (Mr. Kenneth Baker), the right hon. Gentleman said: As far as the telecommunications business is concerned, it would be quite wrong for private investors to be allowed to come in and share the profits in an industry in which they have had no money invested and taken no risks over the last 100 years during which it has been developed. It is the public sector which has developed this industry, and the private investor should not be allowed to come in and participate in the profitable activities of this section of the business."—[OFFICIAL REPORT, Standing Committee D; 21st January, 1969, c. 404–405.] Of course, the private investor should not be allowed to come in at the original cost of a hundred years ago, but he should be allowed to come in at the current market value. The right hon. Gentleman will recall that in Committee I asked him what would be the position of such great enterprises as the former British Motor Corporation if that policy had been pursued and if Mr. Morris, having put down and risked the original capital on making the original bicycle, had been able to prevent other people from sharing in his enterprise. Presumably, on that policy we should still have Mr. Marks's bazaar stall and Mr. Morris's bicycle shop in Oxford. The right hon. Gentleman's statement exposed an attitude which is muddled and fallacious and which I hope will be corrected tonight.

In the extract which I have quoted, the right hon. Gentleman spoke of the great advantages which had been obtained through the risks taken by public enterprise. Are we entitled to be very proud of our telecommunications services? Are they so good when compared with those of other countries? My telephone is almost identical with that which I had in my youth. The waiting lists for the service are still long. Are these matters for pride when we compare the system with that in some other countries? I agree that comparisons can be made with some countries which are favourable to us, but we should not accept such a standard. This is a small, compact, densely populated island in which we should be able to have the best communications services, postal and telephone.

I do not think that the public sector would ever be able to provide the capital or the will to achieve that, and I support my hon. Friend the Member for Acton in saying that the opportunity ought to be taken to inject the private capital which is essential to bring about the expansion which we need.

Mr. Maurice Orbach (Stockport, South)

Is the hon. Gentleman suggesting that only the injection of massive amounts of capital into the telecommunications industry will bring us a better telephone service? Does he not agree that there are other factors to be considered, such as the absorptive capacity of the telecommunications industry? Unless it has the skilled engineers—who are very scarce—to manufacture these articles, all the capital in the world will not help.

Mr. Boardman

I believe that they go hand in hand. If we have the capital, and the private enterprise which risks that capital, it will attract the brains and produce the ideas and service.

Mr. Orbach


Mr. Boardman

Of course not over-night. But let us start now. We must not plan for the future on the basis of a public monopoly and public funds as the sole way to match the great private enterprise economies in other parts of the world. We could start now in the postal telecommunications services, in what is described as "inside the front door". There must be far more scope than the right hon. Gentleman admits for the private sector to supply the various adaptations connected with telecommunications. We must get rid of the old-fashioned service.

May I comment on the counter services? Largely these act as agents for Government Departments. The system of costing and charging for these services should be reviewed and fully explained. This is a costly sphere and many people suspect that these services are being used to a considerable extent to subsidise other Government Departments.

The Motion … regrets the deterioration of services provided by the Post Office. Any hon. Member who studies his post-bag and mixes with his constituents will be satisfied that the public, who are the customers, believe that these services are deteriorating. This is a case where the customers are right.

9.21 p.m.

Mr. Stratton Mills (Belfast, North)

This debate has been overshadowed by events outside the House. Hon. Members are anxious about the situation and are grateful to the Postmaster-General for having made his statement at the beginning of the debate.

1 wish to concentrate on the terms of the Motion, which regrets the deteriorating services provided by the Post Office. In our capacity as hon. Members—visiting our constituents, dealing with our mail and meeting people generally—we must admit, if we are honest, that in the last year in particular there has been a growing volume of complaint from the public about the standard of the postal service. It is right that we should tonight analyse some of the faults, see where things have gone wrong, point the finger of blame at those responsible and try to learn, from those errors, to provide a better service to the public.

I imagine that the Postmaster-General's mail bag has been very heavy indeed in the last few months. I noted, for example, that on 21st November, in replying to a Question about the two-tier system, he said that he had received 1,502 letters on this subject alone from hon. Members—which, by any standard, must represent a heavy mailbag. Can he bring us up to date and tell us the current total of letters he has received on this subject? I noted, too, that replying to the same question—in which he was asked how many letters he had received from members of the public—he became extremely vague and commented that the number ran into some thousands. To us the number of sacks in the in-tray seemed so great that nobody had got round to counting the letters. The purpose of this debate is to delve deeper into these matters.

It is fair that my hon. Friends should acknowledge that the Post Office has an excellent staff. I hope that the right hon. Gentleman will not suggest, and that no hon. Gentlemen opposite will level the charge, that we are engaged in any sort of attack on the Post Office. We appreciate that one of the most excellent assets that it has is the quality and loyalty of its staff.

There is, however, widespread public concern about this issue, and if the Post- master-General would visit the post offices, in some of the towns in Britain he would realise how great this concern is. Our charge tonight can be summed up in three words—muddle, confusion and complacency. These are the points to which I shall come in the course of my remarks.

On the postal side, it is clear that the two-tier system was badly handled in its introduction. Many hon. Members have already dealt with this point. More serious was the error of the right hon. Gentleman in trying to laugh off the mistakes that were made. This was a serious error of judgment on his part. In the debate on 17th October the right hon. Gentleman spoke virtually without notes. He tended to shrug aside any criticisms that were made and said: The system is exciting a great deal of interest"—[OFFICIAL REPORT, 17th October, 1968; Vol. 770, c. 734.] That was true; it was exciting a good deal of interest. The Gallup Poll the following month showed that 84 per cent. of the public disapproved of it and only 4 per cent. were in the category "Don't know", which is in itself a condemnation of the introduction of the scheme.

The right hon. Gentleman was able to produce in that debate two letters of support, but, unfortunately, it turned out that one of them came from a Socialist alderman. That was pointed out by one of my hon. Friends only after the letter had been read to the House.

This evening, however, we must acknowledge that in the later debate of 4th November the right hon. Gentleman somewhat changed his tune. He admitted that mistakes had been made and he acknowledged some of them. He announced certain changes in the procedure which were welcome. Perhaps tonight he can give us more details of how those changes are working out. He announced that a full survey was to be published and he said that it would be produced within six months. It strikes me that that is a somewhat leisurely pace for a matter which is of some urgency. Perhaps this could be looked at again.

In his speech this evening the Postmaster-General seemed largely to sweep aside the points which my hon. Friend the Member for Howden (Mr. Bryan) had put to him and the questions which my hon. Friend had asked, although, no doubt, he will reply to these when he winds up the debate. He congratulated himself that one of the advantages of the scheme had been that several Christmas cards were sent inside one envelope. If the right hon. Gentleman has no other contribution to make to the Post Office, that one will long be remembered, and he will, I have no doubt, receive many letters and congratulations on this striking advance.

Tonight, however, the right hon. Gentleman made what, I believe, was a major admission, and it was right that he should. He admitted a serious error which I wish to underline. He admitted that a mistake had been made in the introduction of the two-tier system at the same time as a price rise. I was glad that the right hon. Gentleman made that point. It was made by Dr. Kramm, of the Post Office Users Council, who warned the right hon. Gentleman of it not in January but before the scheme was introduced. It was swept aside, however, by the right hon. Gentleman.

I am always reluctant to attribute reasons to Ministers for their actions, but I suggest that one of the reasons why a suspicious person might consider that the two schemes were lumped together was so that the public would not notice that at the same time as a new service was being introduced a price rise of 25 per rent. was also being foisted on the public. The right hon. Gentleman has let the cat out of the bag this evening on that one.

Since the debate on 4th November, we have had more evidence about the working of the two-tier scheme. On 23rd January the right hon. Gentleman answered Questions in the House and reported on three facts which are worth looking at. He said that since the service had started the first-class mail had increased from 25 to 33 per cent. Before he congratulates himself too much on that however, one has to look in a little more detail at its implications.

It can be summed up best if one puts it in this form. We had "MacDermot's Law" on the Finance Bill; this falls into the category of "Stonehouse's Law". The law is this: If the second-class mail is bad, one forces the consumer to use the first-class service. This is what hap- pened. The second-class mail service was bad and people naturally use the first-class service and it naturally comes up from 25 per cent. to 33 per cent. I understand its implications, but I should not have thought that the right hon. Gentleman would have been very wise to boast about the matter.

The second point of the right hon. Gentleman was that 94 per cent. of first-class mail was delivered the next day. This is an improvement. Before one goes much further, one should remember what my hon. Friend reminded the House, that before the scheme was introduced 92 per cent. and sometimes 93 per cent. was delivered the next day. It is also important to note that over a period of years the Post Office delivery record was gradually improving. The percentage of deliveries next day was improving gradually. The great change from 92 per cent. and 93 per cent. to 94 per cent. has to be seen in perspective, particularly since before then the volume of mail going by first-class delivery was very much greater than today.

The position can be summarised thus. Despite an extra penny on the post, there is only a 1 per cent. or 2 per cent. improvement in the volume of mail being delivered the next day, on a very much smaller volume of mail going on that service. I would remind the House of the terms of the original advertisement: We benefit, you benefit. I ask the right hon. Gentleman: "Who benefits more? The consumer or the Post Office?" The public benefits by a 1 per cent. or 2 per cent. improvement in reliability, but it is the Post Office which benefits from a 25 per cent. increase in price. I have very little doubt, when one puts the equation "You benefit, we benefit" who it is that benefits substantially more.

The right hon. Gentleman's third point was to do with increased revenue. He said that it is turning out at £21 million, as against a forecast £25 million. My hon. Friend has asked about the drop in the mail and overtime, and no doubt the right hon. Gentleman will deal with those points. I have a question to put which deals with a story in virtually all the newspapers on about 13th January, saying that something like £4 million was to be cut in the Post Office postal budget. I do not know whether it was an inspired leak, but the next day it was partially retracted by the Post Office. The right hon. Gentleman said that any cut would be made without harming services. Perhaps we can have more details on this. Is this amount to be for the period to the end of the financial year as some papers suggested or for a full financial year?

There have been substantial rises in telecommunication prices—a £14–£16 rise in rental, S.T.D. increases and a special services increase. I found a certain general air of confusion about these increases, particularly noticeable in the documents showing the new increases sent out to householders. Although I studied mine for a considerable time, I could not work out who actually gained on the substantial adjustments in some areas and marginal adjustments in others. There was another even greater area of confusion to which I will now turn. This is typical of the muddle which has been coming out of the Post Office in recent months:

There was introduced a special search facility experiment in five different areas of the country. The Daily Telegraph tried out an experiment of telephoning and asking these five experimental areas a question. The Daily Telegraph said: The Post Office introduced a special charge of Is. yesterday at five experimental centres for vague telephone directory inquiries. But its operation was also vague. Despite the fact that these questions were asked, only in one area was it suggested that the special service would be used. I am not complaining about the men operating the system in those five areas. What I wish to know is: were those people given proper instructions for the working of this service?

The other area of dissatisfaction—this is one where many hon. Members have similar worries—is the number of faults which we come across in our day-to-day use of the telephone service. On occasions I have been driven to near desperation as a frequent user of the telephone service, and I was encouraged to see a recent article in The Times by Adam Ferguson in which he quoted an experience which may possibly reflect the experience which others also have had.

The writer was endeavouring to telephone from London to Yorkshire, an operation involving dialling only nine digits. He said: I got through at the eighth attempt in just over half an hour, having dialled a total of 66 figures. The following sequence of noises accompanied my attempt: first, silence; second, the engaged signal; third, a high-pitched buzz after the preliminary '0'; fourth, a faint unobtainable signal; fifth, the engaged signal again; sixth, a loud unobtainable signal; seventh, the engaged signal after the first two digits; finally, the ringing tone. I do not know how many times that was repeated, but Mr. Ferguson was charitable enough to say that he was lucky that he did not get through to the recording piece saying "Lines from London to Yorkshire are engaged" or strike a crossed line.

That is not untypical of the exasperation which many of us experience. I am not saying that this happens every time one uses the telephone, but I am saying that it happens sufficiently often to us in this House to know that there is something wrong in this sector. To express concern about this is one of the purposes of our debate this evening. Even the Post Office figures reveal that something is wrong. Even the Post Office Prospects for 1967–68 admit that something is wrong. Even Post Office figures show that something like 8 per cent. of S.T.D. calls go wrong. I hope this is something which can be dealt with by the Post Office as a matter of urgency.

I refer briefly to the telephone waiting list. The right hon. Gentleman says that he hopes to eliminate it in 18 months. I hope he does, but this is an example of Stonehouse's Law to which I referred a few moments ago. It is this: "If you increase the rental, if you increase the cost of a telephone call and maintain generally deflationary conditions, is it surprising if the waiting list is eliminated?" Is it not inevitable that the waiting list is eliminated?

Time is marching on and I will end by saying this. The purpose of our debate today has been to call attention to the general muddle, confusion and complacency in the Post Office, allied with a period of sharply rising prices. We have had four Postmasters-General since this Government came to office, three in the past year. Each Postmaster-General, on taking office, goes to the Department, hangs up his coat, is introduced to the civil servants and has the papers put on his desk, but before he is able to get to grips with the detailed technical problems he is moved off by the Prime Minister.

Inevitably, there is a sapping of staff morale. Inevitably, Ministers take decisions which they are not fully competent to take. Inevitably, there is rubber-stamping. The Prime Minister is at least partly in the dock for the faults which we are now experiencing. If he plays a game of musical chairs with his Postmasters-General, moving them on every few months, it is inevitable that, when the music stops, someone is left holding the baby—and that person is the right hon. Gentleman whose conduct we are debating tonight. Some members of the Government, of any Government, tend to become accident-prone. The right hon. Gentleman has become accident-prone, and we shall in the Lobby tonight express our dissatisfaction with his handling of affairs.

9.41 p.m.

Mr. Stonehouse

May I have the leave of the House to speak again?

My hon. Friends the Members for Penistone (Mr. John Mendelson), for Bristol, North-East (Mr. Dobson) and for Watford (Mr. Raphael Tuck) referred to the overseas telegraphists' strike. I hope that they will not expect me to comment on their remarks in detail, as this would not be particularly helpful in reaching an agreement on this considerably inconveniencing dispute. The point on which, I think, the House will agree with me is that we hope that the dispute will be brought to an end soon. I add only that we expect to reach a settlement within the Government's prices and incomes criteria. This union, negotiating for a section of public employees, must not expect that any preferential treatment will be given to them as against any other section of employees in Britain.

The debate tonight has been on a slightly lower key than the debates held towards the end of last year when hon. Members opposite got very excited about the two-tier postal system. I am grateful to them this evening for the more relaxed tone in which they have spoken to that subject. Some of the predictions which they made last year about the failure of the two-tier system have not been borne out in practice. We have been able to achieve the reliability of service which I set out broadly as our objective last year. We have been able to give a better guaranteed reliability for the first-class service than applied before two-tier. We have been able to provide in most parts of the country a next-day delivery for first-class mail and a so-called day C delivery for second-class mail. That is extremely satisfactory.

Here are the percentages of performance comparing 1967 with 1968. In September, 1967, for fully paid mails delivered on the day after posting the proportion was 92.6 per cent., and in 1968 we were achieving 93.8 per cent. In October, it was 92.9 per cent. in 1967 and 93.8 per cent. in 1968. In November it was 93.2 per cent. in 1967 and 94.5 per cent. in 1968. In the December period, excluding Christmas, it was 92.3 per cent. in 1967 and 94.1 per cent. in 1968. Thus, admittedly on a smaller quantity of mail—I concede that—there has been a more reliable service for first-class mail, so that customers choosing to use the first-class mail have a slightly higher degree of reliability.

I want to refute the suggestion from hon. Members opposite that we have worsened the second-class service in order to force people to use the first-class service. This is utterly wrong. The second-class service has similarly been improved. We are now delivering within two days of posting a higher proportion of second-class mail than was previously the case, although its quantity has been greatly increased by two-tier. In November, 1967, it was 939 per cent., and in November, 1968, it was 96 per cent. In December, 1967, excluding Christmas, it was 91.7 per cent., and in December, 1968, again excluding Christmas, it was 94.5 per cent. So I throw back the allegation that the second-class service has deteriorated. It has been improved, although the quantity of second-class mail has so greatly increased.

Mr. Bryan

May I throw back something else at the Postmaster-General. I said to him on 4th November: I challenge the Postmaster-General to tell us that, if he had to live the last eight weeks again, he would still introduce the two-tier system simultaneously with the rise in prices."—[OFFICIAL REPORT, 4th November, 1968; Vol. 772. c. 603.] His answer that night indicated that he would not do that. Tonight he has confessed all.

Mr. Stonehouse

What I have said tonight is that I believe, and I have thought so for some time, that it would have been better understood by the public and hon. Members opposite if the two things had been done separately. I have said that publicly outside the House before tonight, and I have repeated it tonight. It is my view that when the two-tier was introduced the public did not fully appreciate the significance of the improvement of the service with which they were being provided, because it was associated with a price increase. I believe that they have since become more aware of it, and the traffic flow confirms it. They have become much more aware of the advantage of two-tier.

Mr. Kenneth Baker rose

Mr. Stonehouse

I do not wish to give way now. I must continue, because time is limited.

I have already referred to the improvement in the mail services. There is a similar improvement in the parcels service. When we compare 1968 with 1967, we see that the percentage of parcels delivered within two days of posting has increased, in September by 4 per cent., from 77.3 to 81.2 per cent., in October by no less than 8 per cent., from 73.6 to 81.4 per cent.; and in December by 7 per cent., from 58.4 to 65.4 per cent. I apologise for giving the House detailed percentages, but they confirm that, far from the services deteriorating, as the Opposition suggests, they have been improving, which was the object of two-tier.

During the months since two-tier came into operation, Post Office representatives have been visiting a large number of business firms, because we believe in very close co-operation with our major customers. We have received increasing congratulations from business firms about the service we are providing. [Laughter.] Hon. Gentlemen opposite may laugh, but we have had a lot of compliments paid to us, in Oxford and Cambridge, for instance. Our representatives there discovered that firms were reporting that 97 per cent. of their mail was being delivered the day after posting. Two large mail order firms in Bradford are receiving 95 and 97 per cent. of their mail the day after posting. An examination of the mail of four firms in the North-West of England showed that, in the main, 94 per cent. and in some cases as much as 97 and 98 per cent. was received next day.

In Wales, the analysis at the premises of some of our principal customers at Cardiff and Swansea showed that 96 per cent. of first-class mail was delivered next day. At Chester, the figure was 94 per cent. In Sheffield, visits to major firms showed a 99 per cent. success rate in securing delivery next day.

We have had great support from some of the Post Office advisory committees, which are made up of laymen and business representatives. They have conducted independent inquiries, and we have had many congratulations from them on the way. in which the service has improved.

The hon. Member for Belfast, North (Mr. Stratton Mills) referred to the overtime being worked. I assure him that at all times the Post Office is anxious to cut excessive costs. If overtime is not required to deal with the traffic given to us by our customers, it must be cut. This was an exercise which the Post Office would have done in any case. But, following the reduction in the amount of traffic which we were receiving, it became doubly important to consider the amount of overtime being worked. There has been a sharp cut-back in that expenditure.

The hon. Gentleman asked what was the correct figure for the cut in expenditure in the budget—£4 million or £2 million? We are not aiming at a specific figure. We are aiming at the maximum possible cut in expenditure which can be achieved without impairing the postal services to the public. As I have said outside the House, we have no intention of reducing services to the public in terms of the number of deliveries or the time of delivery. We want the services to be maintained. But, within that, we hope very much to be able to secure economies, and I have given instructions to the regional directors in the 10 regions to secure the maximum possible economies in expenditure.

Mr. Stratton Mills

Does the right hon. Gentleman deny that the head of the postal division has written to the regional controllers calling for a 1 per cent. cut in their budget?

Mr. Stonehouse

This was one of the requests made as an objective, but it must be understood, within the terms that I have announced, that there must be no reduction in the service to the public. We want the economies to be made in excessive overtime and in other costs without reducing the service to the public.

The hon. Gentleman spent some time talking about what were alleged to be deficiencies in the telephone service. I refute emphatically that there has been any deterioration in the telephone service in the past few years. In fact, after very many years of Conservative neglect, we are beginning to catch up on the investment programme. My hon. Friend the Member for Penistone was absolutely right in his initial remarks. One reason why the telephone service was slipping behind that of other countries was that successive Conservative Administrations starved it of finance during crucial years.

In 1965, a 10-year improvement plan was introduced aimed at reducing to a half, or better, the rate of call failures due to plant defects in the system. The failure rate was about 3 per cent. for local calls and 7 per cent. for STD calls at that time in the United Kingdom as a whole.

The aim then was to improve the failure rate to 1.3 per cent. on local calls and 3.5 per cent. on STD calls by 1975. I am glad tonight to report that we are well on the way to achieving that target, because in the three years which have elapsed since the start of this 10-year plan we have progressively improved the quality of the performance of our plant and are well inside the targets which we have set ourselves. The average call failure rate due to plant defects in the United Kingdom has been reduced to 2.2 per cent. for local calls and 5.2 per cent. for STD.

Hon. Members opposite may make individual complaints. I respect the observations made by the hon. Member for Wembley, South (Sir R. Russell) in his speech, and I undertake to investigate them in detail. The overall performance of the telephone service in Britain is, however, improving as the objective statistics show. This is despite an annual growth in trunk traffic of about 13 per cent. in the last few years and the fact that the number of connections and subscribers is increasing.

The hon. Member for Acton (Mr. Kenneth Baker) and other hon. Members in the debate have referred to the waiting list. I am glad to tell the House that although the telephone system has increased by 30 per cent., from 10 million to 13 million telephone numbers, in the last three years and the number of all calls has grown by 2,000 million per annum, which represents a 30 per cent. growth, nevertheless, although we are dealing with a great expansion in the use of the existing system, we are also applying ourselves to extending the service as well.

We have been able to reduce the waiting list to a very substantial extent. We can now accept 86 per cent. of all orders on demand, and in many parts of the country there is no waiting list. We have reduced the waiting list by 37,000 in the last nine months and we expect to reduce it by 14,000 by the end of March. Therefore, during the present 12 months; we shall achieve the greatest reduction in the waiting list since 1957–1958, and we are well on course for abolishing the waiting list in 1970.

It is significant that in this debate the Opposition spokesmen have not sought an opportunity of emphatically denying what my hon. Friend the Member for Bristol, North-East referred to in his speech: the threat that if they should ever win an election the Conservative Party will sell off the telecommunications system to private enterprise.

Such a measure, which has been advocated by the right hon. Member for Wallasey (Mr. Marples) and is quoted in a Conservative Political Centre document which I have in my hand, would be against the interests of the public. It would be a deplorable invasion of the public interest. It is unnecessary and undesirable, because the telephone service is being developed with its £2,000 million development programme over the next five years at a rate which is necessary to improve the system. Private enterprise is certainly not required to improve it. I invite the House to reject the Motion.

Question put,

That this House regrets the deteriorating services provided by the Post Office.

The House divided: Ayes 155, Noes 191.

Division No. 51.] AYES [10.0 p.m
Alison, Michael (Barkston Ash) Grieve, Percy Page, Graham (Crosby)
Allason, James (Hemel Hempstead) Grimond, Rt. Hn. J. Page, John (Harrow, W.)
Atkins, Humphrey (M't'n & M'd'n) Gurden, Harold Pardoe, John
Awdry, Daniel Hall, John (Wycombe) Pearson, Sir Frank (Clitheroe)
Baker, Kenneth (Acton) Hall-Davis, A. G. F. Percival, Ian
Baker, W. H. K. (Banff) Hamilton, Michael (Salisbury) Pike, Miss Mervyn
Bennett, Dr. Reginald (Cos. & Fhm) Harvey, Sir Arthur Vere Pink, R. Bonner
Biffen, John Hawkins, Paul Pounder, Rafton
Birch, Rt. Hn. Nigel Hay, John Powell, Rt. Hn. J. Enoch
Blaker, Peter Heald, Rt. Hn. Sir Lionel Prior, J. M. L.
Boardman, Tom (Leicester, S. W.) Heseltine, Michael Pym, Francis
Body, Richard Higgins, Terence L. Ramsden, Rt. Hn. James
Bossom, Sir Clive Hiley, Joseph Rawlinson, Rt. Hn. Sir Peter
Boyd-Carpenter, Rt. Hn. John Hill, J. E. B. Rees-Davies, W. R.
Boyle, Rt. Hn. Sir Edward Holland, Philip Rhys Williams, Sir Brandon
Brinton, Sir Tatton Hooson, Emlyn Ridley, Hn. Nicholas
Bromley -Davenport, Lt. -Col. Sir Walter Hordern, Peter Ridsdale, Julian
Brown, Sir Edward (Bath) Hornby, Richard Rodgers, Sir John (Sevenoaks)
Bruce-Cardyne, J, Howell, David (Guildford) Rossi, Hugh (Hornsey)
Bryan, Paul Hunt, John Russell, Sir Ronald
Buchanan-Smith, Alick (Angus, N & M) Hutchison, Michael Clark Scott, Nicholas
Bullus, Sir Eric Iremonger, T. L. Scott-Hopkins, James
Burden, F. A. Jopling, Michael Sharples, Richard
Campbell, Gordon (Moray & Nairn) Kaberry, Sir Donald Shaw, Michael (Sc'b'gh & Whitby)
Carlisle, Mark Knight, Mrs. Jill Smith, Dudley (W'wick & L'mington)
Clegg, Walter Lancaster, Col. C. G. Speed, Keith
Corfield, F. V. Lane, David Steel, David (Roxburgh)
Costain, A. P. Langford-Holt, Sir John Stodart, Anthony
Craddock, Sir Beresford (Spelthorne) Lewis, Kenneth (Rutland) Stoddart-Scott, Col. Sir M.
Crouch, David Loveys, W. H. Tapsell, Peter
Crowder, F. P. Lubbock, Eric Taylor, Sir Charles (Eastbourne)
Dalkeith, Earl of MacArthur, Ian Taylor, Edward M. (G'gow, Cathcart)
Dance, James Maclean, Sir Fitzroy Taylor, Frank (Moss Side)
Dean, Paul, Macleod, Rt. Hn. Iain Temple, John M.
Dodds-Parker, Douglas Maginnis, John E. Thatcher, Mrs. Margaret
Doughty, Charles Marten, Neil Thorpe, Rt. Hn. Jeremy
Douglas-Home, Rt. Hn. Sir Alec Maude, Angus Turton, Rt. Hn. R. H.
Eden, Sir John Mawby, Ray van Straubenzee, W. R.
Elliot, Capt. Walter (Carshalton) Maxwell-Hyslop, R. J. Vaughan-Morgan, Rt. Hn. Sir John
Elliott, R. W. (N 'c'tle-upon-Tyne, N.) Maydon, Lt.-Cmdr. S. L. C. Walker, Peter (Worcester)
Errington, Sir Eric Mills, Peter (Torrington) Walker-Smith, Rt. Hn. Sir Derek
Eyre, Reginald Mills, Stratum (Belfast, N.) Wall, Patrick
Farr, John Miscampbell, Norman Walters, Dennis
Fisher, Nigel Monro, Hector Ward, Dame Irene
Fortescue, Tim Montgomery, Fergus Weatherill, Bernard
Foster, Sir John Morgan, Geraint (Denbigh) Whitelaw, Rt. Hn. William
Galbraith, Hn. T. G. Morrison, Charles (Devizes) Williams, Donald (Dudley)
Gilmour, Ian (Norfolk, C.) Munro-Lucas-Tooth, Sir Hugh Woodnutt, Mark
Glover, Sir Douglas Nabarro, Sir Gerald Younger, Hn. George
Glyn, Sir Richard Neave, Airey
Gower, Raymond Nicholls, Sir Harmar TELLERS FOR THE AYES:
Grant, Anthony Noble, Rt. Hn. Michael Mr. Jasper More and
Grant-Ferris, R. Nott, John Mr. Timothy Kitson
Abse, Leo Boyden, James Davies, Dr. Ernest (Stretford)
Allaun, Frank (Salford, E.) Braddock, Mrs. E. M. Davies, Harold (Leek)
Alldritt, Walter Bray, Dr. Jeremy Delargy, Hugh
Anderson, Donald Brown, Rt. Hn. George (Belper) Dewar, Donald
Ashley, Jack Brown, Hugh D. (G'gow, Provan) Diamond, Rt. Hn. John
Ashton, Joe (Bassetlaw) Brown, Bob (N'c'tle-upon-Tyne, W.) Dobson, Ray
Atkinson, Norman (Tottenham) Brown, R. W. (Shoreditch & F'bury) Doig, Peter
Barnett, Joel Buchan, Norman Driberg, Tom
Baxter, William Butler, Mrs. Joyce (Wood Green) Dunwoody, Mrs. Gwyneth (Exeter)
Beaney, Alan Carmichael, Neil Dunwoody, Dr. John (F'th & C'b'e)
Benn, Rt. Hn. Anthony Wedgwood Carter-Jones, Lewis Eadie, Alex
Bidwell, Sydney Coe, Denis Edwards, William (Merioneth)
Binns, John Concannon, J. D. Ellis, John
Bishop, E. S. Cronin, John English, Michael
Blackburn, F. Crossman, Rt. Hn. Richard Ennals, David
Booth, Albert Dalyell, Tam Evans, Fred (Caerphilly)
Bottomley, Rt. Hn. Arthur Davidson, Arthur (Accrington) Evans, Ioan L. (Birm'h'm, Yardley)
Faulds, Andrew Lomas, Kenneth Perry, George H. (Nottingham, S.)
Fernyhough, E. Loughlin, Charles Price, Christopher (Perry Barr)
Fletcher, Rt. Hn. Sir Eric (Islington, E.) Luard, Evan Price, Thomas (Westhoughton)
Fowler, Gerry Lyon, Alexander W. (York) Randall, Harry
Freeson, Reginald McBride, Neil Rankin, John
Gardner, Tony McCann, John Rees, Merlyn
Garrett, W. E. MacColl. James Reynolds, Rt. Hn. G. W.
Gray, Dr. Hugh (Yarmouth) MacDermot, Niall Roberts, Albert (Normanton)
Greenwood, Rt. Hn. Anthony Macdonald, A. H. Ross, Rt. Hn. William
Gregory, Arnold McGuire, Michael Ryan, John
Griffiths, David (Rother Valley) Mackie, John Shaw, Arnold (llford, S.)
Griffiths, Eddie (Brightside) Maclennan, Robert Sheldon, Robert
Griffiths, Rt. Hn. James (Llanelly) McMillan, Tom (Glasgow, C.) Short, Rt. Hn. Edward (N'c'tle-u-Tyne)
Griffiths, Will (Exchange) McNamara, J. Kevin Silkin, Rt. Hn. John (Deptford)
Hamilton, James (Bothwell) MacPherson, Malcolm Silverman, Julius
Hamling, William Mallalieu, E. L. (Brigg) Slater, Joseph
Harrison, Walter (Wakefield) Mallalieu, J. P. W. (Huddersfield, E.) Small, William
Hart, Rt. Hn. Judith Manuel, Archie Snow, Julian
Haseldine, Norman Mapp, Charles Spriggs, Leslie
Hattersley, Roy Marks, Kenneth Stewart, Rt. Hn. Michael
Heffer, Eric S. Mason, Rt. Hn. Roy Stonehouse, Rt. Hn. John
Henig, Stanley Mendelson, John Swain, Thomas
Herbison, Rt. Hn. Margaret Millan, Bruce Thomas, Rt. Hn. George
Hooley, Frank Miller, Dr. M. S. Thornton, Ernest
Houghton, Rt. Hn. Douglas Milne, Edward (Blyth) Tinn, James
Howarth, Harry (Wellingborough) More, Elystan (Cardiganshire) Tomney, Frank
Howarth, Robert (Bolton, E.) Morris, Alfred (Wythenshawe) Tuck, Raphael
Hoy, James Morris, Charles R. (Openshaw) Urwin, T. W.
Huckfield, Leslie Moyle, Roland Varley, Eric G.
Hughes, Emrys (Ayrshire, S.) Mulley, Rt. Hn. Frederick Wainwright, Edwin (Dearne Valley)
Hughes, Roy (Newport) Neal, Harold Walker, Harold (Doncaster)
Hunter, Adam Newens, Stan Wallace, George
Hynd, John Oakes, Gordon Watkins, David (Consett)
Jackson, Colin (B'h'se & Spenb'gh) Ogden, Eric Wellbeloved, James
Janner, Sir Barnett O'Malley, Brian Wells, William (Walsall, N.)
Jeger, George (Goole) Oram, Albert E. Williams, Alan (Swansea, W.)
Jenkins, Hugh (Putney) Orbach, Maurice Williams, Mrs. Shirley (Hitchin)
Johnson, Carol (Lewisham, S.) Oswald, Thomas Williams, W. T. (Warrington)
Jones, Rt. Hn. Sir Elwyn (W. Ham, S.) Owen, Will (Morpeth) Willis, Rt. Hn. George
Jones, T. Alec (Rhondda, West) Padley, Walter Wilson, Rt. Hn. Harold (Huyton)
Judd, Frank Paget, R. T. Wilson, William (Coventry, S.)
Kelley, Richard Pannell, Rt. Hn. Charles Winnick, David
Kenyon, Clifford Park, Trevor Woodburn, Rt. Hn. A.
Lawson, George Parkin, Ben (Paddington, N.) Woof, Robert
Lee, Rt. Hn. Frederick (Newton) Pavit, Laurence
Lever, Harold (Cheetham) Peart, Rt. Hn. Fred TELLERS FOR THE NOES:
Lewis, Arthur (W. Ham, N.) Pentland, Norman Mr. Charles Grey and
Lewis, Hon (Carlisle) Perry, Ernest G. (Battersea, S.) Mr. Joseph Harper.