I advise the House that the Technical Group sponsoring this motion have intimated to me that their speakers will be Deputy Johnnie Fox, Deputy Tom Foxe and Deputy Blaney.
Private Members' Business. - Rural and Local Post Offices: Motion.
And Deputy Gregory.
Is that agreed? Agreed.
I move:
That Dáil Éireann, expressing concern at the increasing number of closures of rural and local post offices and alarmed at the serious damage being caused to the fabric of community life in rural Ireland, calls on the Government to immediately halt these closures and to reaffirm its commitment to maintain and preserve rural and local post offices.
This motion is not meant to be divisive or self-glorifying because many, if not all, Deputies would support the sentiments expressed in this motion. It is designed to ensure that the political will of this House, through its elected representatives, is brought to bear on the senior civil servants and heads of Departments, the people who appear to shape the policies of organisations such as An Post. I do not wish to engage in a civil servant bashing exercise but there are salient points which need to be expressed if progress is to be made in the maintenance, preservation and rehabilitation of rural life in Ireland.
During the last general election all political parties put forward their proposals on the basis of preserving rural life and maintaining essential services throughout the country. This motion will give those Deputies and parties an opportunity to support a further call to that end. I have no doubt that even those Deputies who do not have a rural base, but are urban based, will also find common ground on this issue because many local post offices in urban areas are also under threat and some have been closed. I cite the cases in Dún Laoghaire and Little Bray in my constituency.
There is an ever increasing awareness among communities throughout the country of the danger of losing their essential services. People are now coming together and lobbying their elected representatives to create a greater awareness of the maintenance of such essential services. The recent decision by An Post to reopen Carracastle post office in County Mayo is a salutary lesson to those in positions of power that when people unite in a just cause, the will of the people will prevail. All our citizens have the same constitutional rights to a basic and efficient postal service. That should serve as a compelling reminder to An Post management that there are powerful reasons for the retention of the present network of post offices.
The usual argument advanced by An Post when a post office is closed is that such offices are non-viable. Those in An Post who would sacrifice such offices to the altar of economic expediency would do well to remember that 300 postmasters and postmistresses receive less than £80 a week. While I do not wish to refer to the recent débácle regarding programme managers, it is ironic that those people who, perhaps, led this country to the brink of an unwanted general election over a relatively minor issue, are paid ten times the amount a postmaster or postmistress in a sub-post office is paid. It is difficult to explain to the public that in order to keep one programme manager, ten sub-post offices would have to be closed.
People are aware of the consequences of the removal of the postal service from their community. The bitter experience from other areas throughout the country, where post offices have closed, is evident by the desolate schools, shops and deserted houses in once thriving villages. Post offices must be kept open to stem the haemorrhage of rural depopulation. People are unwilling to settle in areas where basic services, which are taken for granted elsewhere, are absent.
The necessity to retain the quality and universality of the present postal service is even more vital when one takes into account the blatant anti-rural telephone charges operated by Telecom Éireann. The community is asking An Post what will happen when the sub-post offices are gone and the postmen have stopped visiting the homes of old people in rural areas. Will the postal service in rural areas be diminished to a two or three day week service? This could happen for monetary reasons and because top civil servants consider that their prime object is to run an efficient service which pays, and those who are unfortunate to live in an area where the service does not pay must do without. It is our job as elected representatives to ensure that such a situation never evolves.
The chief executive of An Post, Mr. Hynes, is on record as saying that An Post is committed to rural Ireland. Such assurances ring hollow in the light of recent decisions by An Post to close and downgrade offices throughout the country. Guarantees by Mr. Hynes to computerise all the offices in the network, instead of the 1,000 offices suggested in current proposals, would do much to allay people's fears and it would be a clear signal that An Post can be trusted in its commitment.
It is necessary for me to reiterate why rural post offices should not be closed. Small rural and local post offices — I emphasise there are many local post offices in city areas which are under the same threat — should not be closed because they are inexpensive to run. For example, 116 offices are only paid £80 a week and out of this, the postmaster must supply a premises, heating, lighting, insurance, toilet facilities, etc. If the people who operate these offices are put on the dole, the cost to the Exchequer would be much greater.
Rural post offices should not be closed because their demise would accelerate the depopulation of the rural community. People are unwilling to settle in an area where the basic services which are taken for granted are absent. The consequences of this trend are evident. In communities where the postal services have been removed, small schools have closed, shops and other businesses have lost much custom and in many instances, have closed down. The fact that people have to move out of their own villages to collect their pensions and entitlements means their money is spent outside of their own community.
The removal of postal services from the area destroys the very spirit of local enterprise. Clubs and associations are decimated. Such services should not be removed at a time when European Leader funding programmes are encouraging rural community initiatives. The closure of rural post offices also acts as a disincentive to outside investment.
No business can operate today without a local efficient service. Rural post offices should not be closed because they are the focal point of village life. The post office is the hub, the centre and the heart of every local community. It is a place where the elderly and lonely meet and exchange views. A post office often gives an identity to a community. For instance, it is reasonable to expect that a postmaster or postmistress who could have 20 to 40 old age pensioners collecting their pensions weekly would be the first to know if there was something wrong with any one of them and this would have the effect of a community neighbourhood watch.
The rural dweller, of course, has the same constitutional rights to a basic postal service as everyone else. Rural dwellers do not enjoy the same proximity to essential services such as hospitals, doctors, ambulances, fire brigades, etc. Who then has the responsibility for ensuring the conservation of our rural and local post offices? I suggest that notwithstanding the consideration of the chief executive of An Post and the senior civil servants in the Department of Transport, Energy and Communications, the Minister, as the sole shareholder, and the politicians elected to this House, are the people who should make these decisions. It will be a sad day indeed if pure monetary consideration dictate whether these essential services will be afforded to large areas of this country.
Therefore, it is not surprising that the groups supporting this call include such eminent bodies like Muintir na Tíre, the Irish Countrywomen's Association, the Irish Creamery and Milk Suppliers Association, the Irish Farmers Association, Macra na Feirme, the Leader network, the RRD in County Clare under the guidance of the eminent Fr. Harry Bohan, the National Association of the Unemployed and the General Council of County Councils, among other eminent bodies.
It is also a fact that it is current European Union policy — we are led by it in many Departments and on many other occasions, almost to the point of annoyance — to preserve our small rural communities and what An Post is proposing is clearly contrary to this policy. Many Garda barracks have been closed and community welfare services have been removed from a number of our smaller centres. If our post offices are closed, it would be the death knell for small communities. Substantial EU funding has been received by our Government, but unfortunately very little of it has gone into preserving our small rural communities. The proposed changes mean that no sorting or delivery of mail will be carried out in downgraded offices.
The principle of making limited companies of bodies like An Post, Telecom Éireann, Coillte Teoranta, on the face of it, would seem to be a prudent way to do business. However, when the product itself is in many cases the only basic service available to the public, one that can be manipulated and is motivated entirely on the basis of monetary competitiveness, then we must ask ourselves if we have sold the rights of our people to a company which, in many cases, has no responsibility in this regard. The syndrome of "If it does not pay, let's take it away and bring it to somewhere where it will" is one which, unfortunately, is now becoming firmly established both in Government circles and in Irish life. Telecom Éireann, for instance, is suffering from this syndrome. In many cases, the only telephone box in many of our villages has been removed because according to the company auditor, the take from that box was not sufficient, thereby leaving the village and the community without the basic service of a telephone box.
I come from a constituency where many outlying areas depend on the telephone to make contact with the outside world. Yet, if it did not pay, that facility would be removed. It is up to us, as elected representatives, to ensure that this practice is discontinued. The people, who are essentially the owners of these public utilities, the public, have a say in this matter through their elected representatives. It seems to me that the Minister and the politicians are secondary considerations when it comes to policy making decisions in this area and hence, of course, the grave disquiet among the public. I call on the Minister to immediately reaffirm his authority as the sole shareholder and the head of the Department with the sole responsibility for our postal services.
The closure of a rural post office generates a sense of loss and a climate of gloom, frustration and hopelessness in a community. People feel that they are left behind and, therefore, inferior. This in turn leads to distrust of Governments who seem to sanction these decisions. Effectively, rural people feel disenfranchised and powerless. When a post office is closed, in many cases people may have to travel up to ten miles to post even one letter. When one considers the services provided by the local post office — a savings bank, savings and prize bonds, television and dog licences, envelopes, stamps, parcel post, postal orders, widows and retirement pensions and social welfare benefits, etc.— the enormity of the loss becomes evident.
The closure of a rural post office removes from a community the postmaster or postmistress who fulfills many roles beyond the call of duty. They can fill in forms for old people, read and write letters for illiterate people and advise the elderly of their entitlements and investments. Larger post offices do not provide that personal service which is to be found in a small community where the postmaster or postmistress knows all their people.
The closure of small post offices affects most adversely, the elderly, the disabled and those on low incomes. For instance, where there is no local post office, a person may have to hire a taxi where there is no public transport and travel that ten miles at great expense. For instance, it could cost someone on a pension of £70 a week £8 just to get their weekly entitlements. The closure of the rural post office means the irreplaceable loss of the postman who was often the only daily contact for lonely and isolated people. As well as the mail, he brings the local news, posts their letters and acts as a communicative link between them and the community.
The decision by An Post to computerise all but 800 offices is a clear indication that the notorious viability plan to target the closure of 550 post offices is still very much in place. The rural community is now waking up to the reality that what happened in Carracastle in Mayo could well be their experience tomorrow. Whether An Post admits it or not, the decision not to computerise up to 600 post offices is the clearest admission that these offices fill no long term future role in An Post's plans. The irony of An Post's policy is that based on the false economic premise that smaller post offices are costing the company money, the reality is the smaller the office the less it actually costs. As I have stated, up to 118 offices cost less than £60 per week to the company and are, in fact, often subsidised by the postmasters' or postmistresses' private business.
I am calling on An Post and the Minister to publish a new dynamic and imaginative viability plan with the emphasis on viability and expansion for these 600 offices rather than their destruction and dismantlement.
This Private Members' motion is most timely. According to the latest statistics in the region of 275,000 people are unemployed in this country at the moment. Thankfully that figure is decreasing but if the real figures for those working on FAS schemes and certain educational courses were known, perhaps that figure would be higher than 300,000. Anyone who visits the villages of Ireland today and takes stock of the services provided there by local traders and compares them with the services and the number of people trading there 20 years ago, will realise that the people who talk about rural Ireland dying on its feet are not far wrong. If that decline is accentuated by the policies of our Government, it is all the more regrettable.
In 1991 a major onslaught was made on our post offices not merely on sub-post offices but also post offices in towns and employing up to ten people. However, when the extent of the opposition to that plan was realised, it was soon shelved, or so we thought. However, what appears to be happening now is that post offices are being closed by stealth.
In 1993 An Post's turnover was £271.8 million and the profit accruing therefrom was £7.3 million. Of the 1,946 sub-post offices in 1991, at the present rate of closure, there will be 1,000 fewer by the time this Government leaves office. Some 75 per cent of An Post's total retail business is conducted in sub-post offices and in excess of 40 per cent of all sub-post office work relates to social welfare, thus giving those post offices a social significance. From time to time we hear of the preponderance of post offices throughout Ireland and we are told that, per head of population, we have a far greater number of post offices than any other country in Europe. We have one post office for every 1,600 people, in England there is one post office per 2,500 people and in West Germany there is one per 3,300. It is ridiculous to compare Ireland's basically rural, agricultural economy with highly industralised countries like England and Germany which have huge centres of population.
The money saved by the closure of post offices is reckoned to be in the region of £2 million to £2.5 million. That is a paltry sum when one realises the social effects those post offices have on the rural community. The sum of £2 million to £2.5 million from a turnover of £271.8 million is a very small figure indeed.
The record of An Post is very good. Compared to our European neighbours An Post ranks third in the list of EU countries in its provision of services. In excess of 95 per cent of all letters within the country are delivered by the following day. The EU maintains that money is available from the EU for the provision of postal services in disadvantaged areas. I do not know whether that money has been drawn down or what has happened with it but, if it is to be of any benefit to us, it is time to call on it if it is there at all.
Doubting Thomas.
A Government committed to creating employment and consequently reducing unemployment, must recognise the contribution that an organisation like An Post makes in providing jobs. The continued operation of sub-post offices shows An Posts belief in the decision making abilities of local staff in those post offices but if they were closed, the decision making would be taken at regional level. The people making those decisions would be far removed from the place where such services are required and, consequently, would be providing a poor service.
In 1991 the then Minister said:
I can assure the House that there is no question of the Government agreeing to the unwarranted dismantling of the postal network. I wonder if that is still the thinking of the Minister, albeit a different Minister. In particular, I should tell the House that An Post have now informed me that it is their clear objective that the job reductions will be of a voluntary nature.
I wonder if that is still the case. The survival of An Post, according to Professor Cuddy of UCG, will require creativity and imagination. An Post must develop new products. Have any such products been developed and, if so, what effect are they having on the life of An Post?
I congratulate Deputy Fox on tabling his motion, to which I am happy to put my name and fully support. The issue, as is emphasised in the motion, is both a local and rural one. I think that Deputy Fox deliberately emphasised that it was local and rural because it is an issue which affects both urban and rural areas. The Minister is quite familiar with both rural and urban areas, such as Croghan in his own constituency with which I, too, am very familiar.
The Deputy's mother's good country.
However, having said that, and because I have an affinity with the Minister's area, it disappoints me particularly to see that the Government's response to this motion is, in effect, to support the policy of An Post in its closure of local and rural post offices. I see no other way of interpreting the amendment which the Government has tabled to this motion. It will not simply be a matter of disappointment to me but also to people who have campaigned around the country, in urban and rural areas, for the retention of their post offices.
In my constituency and in the nearby areas of Fairview, which I formerly represented — and I hope that it may return to my electoral area when the boundary commission gets under way in the next few weeks — and Cabra——
I will take note of that.
In both of those areas quite a strong campaign has been fought in recent times — one was successful and the other, regrettably, failed. They are communities which fought to save what they saw as an essential part of their community. I wish to refer briefly to the experience of both those campaigns and the meetings which Government and Opposition TDs had with senior officials of An Post when we were making the case for the retention of those post offices.
It came across to me during both campaigns that the senior executives of An Post — and, apparently now, the present Minister and the Government — have no interest or concern in the social impact which a post office closure can have on a very close knit community, whether urban or rural. They are simply not interested; it is not an issue in their consideration. It is irrelevant to their views on whether a post office should stay open or be closed. They have no interest in the impact on the many elderly people, in particular, in whose lives the post office still plays a critical role, even in urban areas. That critical role was outlined very ably by Deputy Fox. The sole interest of the senior executives of An Post, which appears to be paralleled by the sole interest contained in the Government's amendment, appears to be to use every opportunity presented to them to close a local post office or amalgamate neighbouring post offices.
Even in the case of Cabra east, in the parish of Christ the King, which is a very large urban area with a mainly elderly community, where the threatened post office was economically viable and making a profit, the An Post executives refused to accept that fact as sufficient grounds to ensure that it would remain open. Therefore, what chance do rural post offices which are not considered economically viable have when that is the attitude of the senior executives of An Post?
In the case of Cabra, I want to pay tribute to the large local committee, comprised mainly of women, led by Mrs. Rita Mullen, who is a stalwart of the local community, which refused to accept defeat and, along with myself and other local public representatives, campaigned vigorously and succeeded in retaining a post office for that community. If they had not fought that campaign there was no doubt in anyone's mind that An Post fully intended to remove the post office from their area.
Regrettably, in the case of Fairview, despite the intervention of Government and Opposition TDs — although hypocritically, I have to say, in the case of the Government TDs in the light of the amendment which has been tabled to this motion. There is no other interpretation of that——
They were helping the Deputy to keep it open.
There is no other interpretation.
The Deputy never even mentioned Bertie.
The Minister will have his own time.
Sorry.
The post office was closed and a focal point for generations in the Clonliffe, Ballybough, Marino and Fairview areas, across from the parish church and beside the local shops and GPs, has been seriously undermined. It is widely believed in the locality that its closure will have disastrous long term effects on that area.
I feel obliged to mention the traumatic impact on a disadvantaged inner city community of the closure of a post office. I refer to the case of the Summerhill post office in my own area, not far from where I live. In this instance it was not due to An Post policy but to an attack by a heroin addict with a blood filled syringe on the long serving and most respected postmaster. Government policy was indirectly responsible, in so far as successive Governments have failed to solve the problem of inner city poverty which has led to widespread heroin addiction in that area. Its closure — and it remains closed to this day — has accelerated urban decay in that part of our capital city. It is a cause of enormous hardship, particularly for elderly people.
I wish to again compliment Deputy Fox on bringing this issue before the House and I hope that it is successful in the vote tomorrow night. I wish to restate how disappointed I am with the attitude taken by the Government and its response, which is clearly one of support for the closure of local and rural post offices. It is regrettable from a Government with a Labour involvement. I am surprised that the Minister and Fianna Fáil would support An Post in its destruction of both urban and rural local communities.
Deputy Blaney has five minutes.
My experience is that An Post is like a vulture waiting for a death — the death of the ageing postmistress or postmaster in some of the rural local communities. If any malpractice is detected in a post office this is another wonderful opportunity for them, in that the occupant of the office this is no longer there so it can be closed. We have had quite a number in Donegal but it is only typical of the entire western seaboard. The sparsely populated areas are those which are suffering most. A few which come to mind are Ballindrait and Drumkeen in my constituency and, of course, the present hoo-ha which we have had, and properly so, about Carracastle. There are scores of others and hundreds yet to come.
Does the Government realise that these centres are, as previous speakers have said, centres around which the local community revolves? They are far more important than the business which is transacted in them. They are being subsidised by the efforts of the occupants of the posts of sub-postmaster or postmistress in other directions such as local shop supplies, convenient shopping and so on without which the post office would not be worthwhile. On the other hand, as it turns out, the local shopping without the post office is not worthwhile either.
Therefore, the net result, whether they die off or as in the case of some who have fallen on such lean times that they have engaged in malpractice in the office and are fired or prosecuted and not replaced, is that every post office which closes will on average cost more in social welfare for the unemployed than the post office is costing the State. That is only in monetary terms. This service is vital to the community in cities, towns and elsewhere, not just the rural community.
Why can we not engage these people by paying them a commission? It is costing a fortune anyway. Social welfare costs the taxpayer 100 per cent more than the recipient receives. Where does it go? It goes into the collection of taxes, administration, the social welfare officer and so on. All the wasteful paraphernalia is there and yet much of this could be done in the local community. This would help retain the post offices, pay the people who run them and provide a service. There is much talk about rural development and agri-tourism. All these things are dependent upon an enhanced postal service, not a diminished one, which is what we are facing.
Where is this wonderful organisation of An Post and where are these wonderful times of development and technological advances in communication? I recall my first time in this city. I could post a letter in the GPO as late as 6 p.m. in the evening and it would be received at 9 a.m. the following morning in what would be regarded as a very backward area, that from which I come. That continued right through the war years and was not just at normal times. One is lucky now if one gets the letter on the third day and if a weekend intervenes it takes five days. One cannot rely on it.
In those days the reliability of An Post was second to none. Today, regardless of all the advances, it is now totally and absolutely undependable in so far as doing business is concerned. Remote areas which do not have access to faxes and other types of communication are dependent upon a service that has deteriorated faster than technology has developed in the same period of time.
The Minister comes from a town and, as is the case in most towns in the provinces, he is probably regarded as a townie. He and his father were not elected to this House without the electorate in the hinterland which constitutes a rural area similar to that from which I come. He is fully aware of the situation but naturally, as a member of a Government with collective responsibility, it is perhaps difficult for a Minister in those circumstances to really put his mark where he would like to put it. This would be to not just retain the post office service we have in the more remote areas, suburbs and run-down areas in our cities and towns, but to enhance it.
We can talk until the cows come home about tourism being the future, but if one does not have a postal service what is one saying to tourists? They are coming to a place that does not know what day tomorrow is. They might or might not get the documentation they require urgently at their present hotel address because there will not be any service of the nature that was given in the past.
I have to ask the Deputy to conclude please as his time is exhausted. He had but five minutes, I am afraid.
How many minutes do I have left?
Minus two.
I understood from the Ceann Comhairle that we had until 7.53 p.m.
That is correct.
That is what I was told, otherwise I would not presume on your good nature.
It is now 7.55 p.m.
I defer to the father of the House for a few minutes.
I have been counting it incorrectly. The Leas-Cheann Comhairle and the Minister both count very well.
I appeal to the Minister. He understands the need to enhance our postal service as our population diminishes rather than diminishing the post offices as our people move away. We want those people back and if we are to build, we want to improve this service which we are getting for buttons.
Postmistresses and postmasters have not been paid for their work over the years. The work they do is far beyond that for which they are paid. They are the local centre and distribute the news, good or bad. I appeal that these people be nurtured rather than decimated as is the practice of An Post. In its new role and in the new European scene of competitiveness, An Post seems to forget where it came from and where it is going.
An Post was never put in place to be a competitor; it was put there as a service. If they are reaping the benefit in the big centres through their charges and so on, why can they not distribute that over the entire cost? This was the approach in the past. I was Minister for Posts and Telegraphs at one time. I remember the telegram I received from a wag back in my constituency on the day I was appointed. It said: "Congratulations. May you last a long time and long may you P & T." All I say to the Minister is: long may he P at this stage and never mind the T. That will be for another day.
I move amendment No. 1:
To delete all words after "That" and substitute the following:
"Dáil Éireann notes that the policy of An Post to ensure a first class postal service in rural areas is an intrinsic part of wider Government policies which are aimed, in the aggregate, at facilitating and underpinning rural renewal and development."
I welcome the opportunity this debate gives me to outline the practice of An Post in relation to the closure of rural and local post offices and to put a few facts on the line. There is a perception abroad that things are accelerating in a certain direction, which the facts do not support. Before I deal with that, however, I would like to tell the House something of the general policy that governs the postal service today.
The Culliton Review of Industrial Policy pointed out that the cost of our postal services is high relative to our competitor countries and urged that An Post's financial difficulties be resolved. Everybody agreed with the Culliton report. Our postal charges are in the top four in the EU league table. In the context of its strategy for implementation of the Culliton report, the thrust of which all parties agreed with, the Government decided that An Post should implement efficiency and cost reduction measures without recourse to general price increases or public subsidy. Also, as part of that strategy the Government has decided that An Post should reduce its postal charges to at least average EU levels over a three year period.
The current EU average domestic rate for letter mail is 28.3p which compares with this country's rate of 32p for a standard letter. The gap between Irish and EU domestic rates is therefore about 13 per cent. On the assumption that exchange rates have a neutral effect, that EU rates increase at 3 per cent per year this year and in 1995 and that Irish rates do not increase at all, An Post will have progressed towards lowering their rates to the EU average as the gap will fall to 5 per cent or 2p on the standard letter by the end of 1995.
I would like to touch upon some of the developmental measures An Post is taking to strengthen post office services nationally and to underpin rural renewal and development. We have heard a lot of negative talk here so far this evening. As part of its plans to improve services to its customers, An Post, in co-operation with the Department of Social Welfare and the National Treasury Management Agency, has formulated plans to provide computerised services linked by a telecommunications network to 1,200 post offices nationwide. That was earlier regarded as something that should not be welcomed.
The development of these automated counter service delivery systems will cover the current range of products and services. It will also provide capability for future products and will enable An Post to tackle the inefficiencies and cost issues associated with manual systems. They will provide for customers a higher quality and more cost effective service and allow for the development of new products within the framework of electronic information transfer, which is, as Deputy Foxe said, a vital component of the future survival of post office networks as we understand them.
Phase 1 of this automation project, which is being funded from An Post's own resources, will see the automation of the 600 busiest offices nationwide. These 600 offices will cater for 84 per cent of the total business transacted. This phase, which commenced with the implementation of central computer systems in 1992, is scheduled for completion by early 1996. At present equipment is installed at 180 offices nationwide and the system is being rolled out at the rate of 50 offices per quarter. The target at end 1994 is 335 offices and the remaining 265 will be in place before the end of the first quarter 1996.
Phase 2 of the project focuses on the next tranche of 600 post offices. These offices serve the less densely populated areas and cater for 15 per cent of the remaining customers of An Post. Upgrading these marginalised offices, which are in danger of becoming more disadvantaged when phase 1 of the counter automation is completed, is in keeping with the European Union objectives, particularly that of providing equal quality of service to all inhabitants. Completing this automation programme over the full 1,200 offices will bring the post office network in Ireland into line with that of our continental counterparts whose programmes and networks are currently more advanced than ours. Automation would not be feasible for the remainder given the level of service provided by them, but that does not mean that they do not have a role in the network. They will continue as before under the same circumstances.
It should be noted that the post office offers the largest and widest network of offices providing financial services in Ireland. The availability of modern streamlined and cost-effective services, which the automated programme will facilitate, will obviate the need for rural communities to travel significant distances to obtain financial products and services. That is the purpose of the programme in the first instance. The post office automation programmes will, in addition, provide an effective bridge between rural communities and the post office networks of other EU member states for the provision of international money transmission products required to cover 99 per cent of business in current post offices. These services are of critical importance to areas with high levels of emigration. These areas are encompassed in this automation plan. Plans, therefore, are in place and are being implemented to address what is seen as a serious deficiency in the level of service which can be provided by post offices, given the level of competition from other sources traditionally in the domain of post offices.
The projected roll out target for phase 2 of the project is as follows: 1994, 120 post offices; 1995, 240 offices; 1996, a further 240 offices. It is An Post's intention to roll out phase 2 in conjunction with phase 1 and to meet the combined implementation target of 1,200 by the end of 1996.
Another project which will be cofunded by the EU will be the construction of regional mail centres. An Post has already commenced a major programme of investment in modernising the postal infrastructure. A new automated mail centre has been built in Dublin costing approximately £15 million and the establishment of a number of mail centres located in the regions is planned. The integration of the Dublin and regional mail centres with the national roads distribution network will enable the provision of consistent, highly cost-effective, quality mail services in all rural areas.
The changes proposed involve the introduction of a mainly road based distribution system linking Dublin with provincial mail depots located at Athlone, Portlaoise, Cork, Limerick, Tipperary, Bray, Sligo, Tralee and Galway. Each of these depots will control the movement of mail into and out of the catchment area served by them. The principal regional mail depots will be fitted with modern material-handling equipment enabling use of European standard containers for the exchange and transfer of rural mails. The regional mail centres to be constructed at Athlone, Portlaoise and Tipperary will receive co-financed assistance under the Community Support Framework. When these changes are fully implemented, customers will be able to post until the night mail, generally 5.30 p.m. and secure first delivery next day to any part of the country. The consolidation of processing at the mail centres will also enable extension of computerised control systems for tracking and tracing all mail products into rural areas. We must remember that this type of investment was not on the horizon prior to necessary rationalisation which took place to make this semi-State body commercially viable.
To return to the question of closure of sub-post offices, under section 12 of the Postal and Telecommunications Services Act, 1983, An Post is required, among other things, to provide a national postal service to meet the industrial, commercial, social and household needs of the State for comprehensive and efficient postal services, and, so far as the company considers reasonably practicable, to satisfy all reasonable demands for such postal services throughout the State. Accordingly the provision of postal services in any particular area is a day to day matter for An Post.
The company does not require my approval for the closure of individual sub-post offices but the company's judgment must be based on some criteria. The present policy, with which I agree, is to consider an office for closure when the incumbent postmaster retires or dies, when no family member wants to continue to run the office, where the turnover in the office is too low to yield a long term sustainable living from the job and where there is, within reasonable distance, another post office to which the business can be transferred. As evidence of the working of that policy, I can tell the House that since 1984 a total of 890 offices fell vacant. Of these 416 or 47 per cent transferred to a family member, 239 or 27 per cent were filled by competition and 235 or 26 per cent were closed under the policy I outlined. There is nothing new about the closure of sub-post offices under this policy. In fact closures have been taking place for the past 30 years or so.
In 1965 the post office network reached its peak. In that year, counting head post offices, district and branch post offices and sub-post offices, there were 2,270 offices in all, of which 2,175 were sub-post offices. By the time An Post was established in 1984, the number had fallen to 2,171 of which 2,076 were sub-post offices. From 1984 to date there were an average of 21 closures a year but in the same period 13 new offices were opened so that today the network stands at 95 company offices and 1,854 sub-post offices, a total of 1,949 offices. To show the breadth and density of the network, this compares, for example, with a total of approximately 830 outlets currently maintained by the five large banks and 1,030 outlets, if one adds in the network of the country's largest building society. The post office has almost twice that number of outlets. Ireland has the greatest density of post offices of any EU member state. Deputy Foxe referred to this. We have one post office for every 1,800 people, the UK has one for every 2,500 people, France, Germany and Luxembourg have one per 3,300 population and Portugal, which is not traditionally an industrialised country, has one for every 7,000 people.
The House will recall that the closure of a large number of sub post offices— over 550 in all — was put forward in An Post's viability plan in 1991. The then Minister referred the proposal to consultants for a socio-economic assessment with an associated proposal for the installation of roadside letter boxes. An Post was requested not to proceed with these proposals pending consideration of the consultants' report. I have had an opportunity of reviewing their report but it has since been very much overtaken by events.
At the time the consultants were appointed, An Post was in a very precarious financial position. The company had suffered a loss of £8.7 million for the year ended 31 December 1990 and the outlook for the future, to say the least, was anything but encouraging.
I am happy that the situation since then has changed considerably culminating in an agreement on necessary recovery measures — this is often forgotten when we talk about postal services — to restore the company to financial health being signed by management and the unions with the co-operation of the workforce in September last year. These measures, many of which are now in place, involved some of the most fundamental changes in the history of postal services and included a transfer from rail to road transport of mails, introduction of single daily delivery of mail in Dublin and other urban areas and the commencement of operations in the new Dublin Mails Centre, which replaced the outdated Central Sorting Office in Sheriff Street.
The agreement on recovery measures also provides for a revision of rural network routes which will result in economies being achieved in rural deliveries. The proposals are currently the subject of discussions with the unions and will not affect the counter services provided in rural post offices. In some quarters the revision of these rural network routes is associated with closure of sub post offices; this view is incorrect. The revision consists of the development of new delivery routes based on mileage, number of delivery points, frequency of delivery, type of road, etc., to ensure the optimum use of the staff and vehicles involved. Under the project the number of sub post offices which do their own sorting will be reduced but there will be no lessening in the number of sub post offices operating or in the level of counter service available to the public. That is the important point.
It is appropriate to pay tribute to the effort put in by management and unions in An Post in securing agreement on these necessary recovery measures. I am well aware that sacrifices were called for from both sides. However, while the position of An Post has improved there is a continuing need for the company to address the cost issues, improve services to its customers and increase revenues, which must also be a vital part of any recovery plan. This can only be achieved through the continued commitment of both management and staff and that is there.
Last year An Post turned in a profit of £4.8 million after tax and with three quarters of the year gone the indications are for a similar profit in the current year. These results, of course, are no guarantee of the future financial health of the company, but it is a major turnaround compared to the context in which this debate was held in 1991. While An Post continues to have difficulties with its high costs, its revenues too are under threat, both from EU liberalisation proposals and from technological changes in the market place.
In this regard the European Commission in June 1992, for the information of the House, published a Green Paper on the development of the Single Market for postal services. The central thrust of the Green Paper is the provision of a universal postal service at affordable prices and with a satisfactory quality of service throughout the European Community. Beyond the central thrust the Green Paper envisages a number of changes in the Community postal sector, including the introduction of additional competition by the liberalisation of certain areas of the letter mail services such as international mail, direct mail, advertising material, and new types of services.
I support the central thrust of the Green Paper towards a Single Market. I have indicated that if detailed analysis shows that the introduction of a particular liberalisation measure would be in the interests of the customer and would not jeopardise the capacity of An Post to provide a universal service of the required quality, in such cases serious consideration will have to be given to its introduction. The interests of the customer and the financial health of An Post can go hand in hand.
In addition to the competition that An Post will face from couriers and European competitors, we all recognise that changes in technology, for example electronic mail and facsimile transmissions, will continue to cut into the company's markets. It is not a static market. The company is gearing up to meet these challenges and with the continuing co-operation from staff and support from its customers, which is vital, it is well placed to absorb these challenges. The policy being pursued by An Post is part of an integrated approach to provide high quality and affordable services and infrastructure to rural communities.
To broaden the argument for a moment, for the development of any region of the economy, urban or rural, it is vital that sound macroeconomic policies are pursued. The Government is pursuing such policies, they contribute to low inflation and low interest rates, which are essential to economic progress and employment growth throughout the economy. This economic progress is manifesting itself in strong output growth this year of the order of 5.5 per cent accompanied by an expected growth in non-agricultural employment of 28,000. We are witnessing a welcome fall in unemployment, with numbers on the live register down by 20,600 since the beginning of the year. The benefits of strong economic and employment growth spread throughout the economy and sustaining such growth is the surest way of providing real and tangible benefits to rural areas, areas I represent the same as other Deputies who have spoken and will be speaking in this debate.
However, Government policy towards rural areas does not rely on the organic spread of economic growth alone. Initiatives are also being taken through the Structural Funds and other policy measures. The investment programmes under the Structural Funds are transforming the physical and economic infrastructure of the whole economy. Our road networks, water and sewage treatment facilities throughout the country are being constantly improved. High quality telecommunications, another area under my aegis, are a vital part of the modern business world and are being provided for throughout the country. We have to meet that challenge also as more of the same will not do. Tourism, a major source of income and employment in rural areas, has benefited from substantial Structural Funds investment and will continue to do so. The extension of urban renewal incentives to more towns throughout the country will also benefit the surrounding rural areas.
The county enterprise boards are acting as catalysts for business and enterprise development in each county. The community employment programme is tackling unemployment on a nationwide basis through providing employment of economic and social value as well as training for the unemployed with the ultimate aim of reintegrating them back into the workforce. Various training and education programmes aimed at improving the skills of the population will, of course, also enhance the skill of rural people and enhance their income and employment prospects.
There are also many direct initiatives in rural development. The Leader programme and measures promoting alternative rural based enterprises create an enterprise culture which is helping to reinvigorate rural areas and reduce their dependence on traditional agricultural enterprises. Industrial development and the spread of manufacturing and service employment to the larger towns throughout the country is a major benefit to the surrounding rural areas. The Government programme of decentralisation, pioneered by this party in a minority Government and continued through successive Governments of which we have been a member, has involved the relocation of 3,500 civil servants to 19 provincial locations and is also benefiting rural areas through its effects on the demand for services. It has also permitted many people to return closer to their rural roots thus invigorating the rural areas in question.
The question of social change is a reality in every country in Europe. It requires responses first at a macroeconomic level where there is economic growth, but we do not simply depend on the overspill of that growth to rural communities. We have direct interventionist policies at microeconomic level which are beginning to work. We have seen an improvement in that area by empowering local communities, through Leader programmes, county enterprise boards and the many other initiatives where we are seeking locally based, locally focused initiatives to deal with problems which will not be solved in the short term and which will remain with us. The Government and politicians are conscious of the need to bring forward imaginative and innovative responses to make sure that the maintenance of rural communities has a high priority as part of national policy. It is in the interest of the quality of life if nothing else that those rural communities be maintained.
Apart from the specific issues which I have addressed, the wider issues illustrate that we are seeking to underpin rural renewal and development. The Government has done much in the past 22 months with the assistance of EU Structural Funds and Cohesion Funds to establish locally based initiatives which are now beginning to work. Anybody who has considered the Leader programmes and what has emerged from the Leader groups throughout the country can only be impressed and encouraged by the fact that not simply in west County Clare where the pioneering work of Father Bohan has been mentioned but throughout rural Ireland people are falling back on their own resources. Only this week I was able to assist a County Offaly tourism group, who through a direct marketing initiative under the Leader programmes, are in the USA talking to the travel trade and travel writers and obtaining some niche heritage tourism into an area where such would not otherwise take place, despite the best efforts of the broader policies of Bord Fáilte and other such organisations.
Such initiatives would not take place if people were not out selling their own communities, and prepared to be optimistic about the benefits which would accrue to their area as a result of such initiatives. What local community in the midlands, the west or anywhere else would have been able, and would have had the wherewithal, to engage in such initiatives ten, let alone 20 or 30 years ago, without access to these kinds of funds? This illustrates the change in this area. Many of us, as local and public representatives, are leading the fight for local communities to see in what way they can exploit their own local resources for the benefit of their areas.
Through investment in the modernisation of our postal services, we are making it possible to ensure their viability, to implement the recovery measures which have been agreed between management and unions and not to remain with the status quo. Everybody could see that the demise of the service was inevitable if a change was not brought about to deal with new products, and to compete with couriers, facsimile machines, telephones and such like which are taking over the functions of the postal services.
The Taoiseach recently announced that he has asked the Minister for Finance to undertake a study which would involve an examination of the demographic changes in rural areas. The study will include an examination of the effect of population changes on various State policies, including those which I have mentioned. When the study is completed it will be for the Government to decide what lessons we can all learn and whether modification of existing policies is warranted. There is a recognition and an understanding of the type of social change that is happening, and inevitable in some senses. There is a need for imaginative policy responses from the Government, and we are in the process of providing these, not simply with regard to the urban and rural post offices in terms of the level of service they can provide, which is under my aegis, but throughout the gamut of Government policy to ensure that we meet the needs of rural communities in the same way as we seek to meet the needs of urban dwellers.
I compliment Deputy Fox and the Technical Group for bringing this timely and opportune motion before the House. It is vital that it be brought before the forum in which legislation is drafted and decisions are made, including ultimate choices as to our priorities. It is vital at present, when the sacred god of rationalisation is being foisted on all areas of economic development that we look rationally at what is a social and economic service and decide exactly where our priorities lie.
It was as a result of a similar motion before the House two years ago that the infamous viability plan was finally put on the shelf, once and for all, it was believed. I pay tribute to the Communications Workers Union who, on that occassion, took the campaign to the local communities, both rural and urban, and eventually succeeded in a commonsense approach. Logic won the day.
Had that viability plan been implemented in its original form, it would have devastated rural and small urban communities. The main tenets of the plan are worth recalling and included the closure of 550 rural sub post offices within a short period of time and, with regard to the post office structure itself, the relegation of offices in large towns to sub post office status. In addition, the loss of 1,500 jobs was proposed, the erection of letter boxes at the heads of rural laneways and a number of other elements which, collectively, would have destroyed rural communities.
The economic basis of the viability plan was never fully disclosed because Minister advises that he has considered the report from the consultants, yet we still have not been advised of the key arguments which were supposed to have underpinned the plan.
There is a strong social argument with regard to the postal services, but there is also the economic argument. Many fallacious arguments are being advanced regarding the non viability of certain post offices. When the breakdown of the sub post office structure is considered, and when an examination is made of what they cost An Post in net terms, it is evident that they are providing services free gratis to the community and to An Post. When it is considered that 180 sub post offices cost An Post £3,000 per annum, or less than £60 per week, it is obvious that the cost of lighting, heating, public liability insurance, staffing levels, or whatever else may be necessary to the provision of the service, is being provided at a loss by the sub postmaster or sub postmistress giving the service.
Were it not for the fact that the sub post office itself is being augmented, supplemented, supported and propped up by a local shop, or whatever, it could not provide a service and remain in operation. If An Post itself was providing this service, it would have gone to the wall years ago. Going up the graduated scale of payments to sub post offices, this case is substantiated throughout.
When An Post was removed from under the umbrella of the then Department of Posts and Telegraphs, there was a general expectation that it would show flair, entrepreneurial skill and enterprise, that it would bite the economic bullet, would realise the economic opportunities available and would become a viable competitor in the financial services sector. However, what has been produced in terms of enterprise and flair has been nothing other than a series of mickey mouse schemes which have been utter failures. For example, there was the scheme whereby a person made a tape at home and sent it to Aunt Mary in America which she then rubbed out and returned. If that is the best that could be done in this day and age it would be best to forget it. There was also the scheme where the interest of children in letter writing and communications was developed — post cards were sent to somebody in some other part of the world, or, indeed, down the road, who painted the back of the card and returned it. There were numerous other failed schemes devised as a way of illustrating the supposed flair and enterprise of those at management level in An Post. They were all costly failures. Despite this, the core service was neglected. For example, in the days of the threepenny stamp, if a letter was posted in Dublin, it could be guaranteed that it would be delivered in Belmullet the following day. That guarantee is now gone.
Irrespective of whether there is a conscious effort to upgrade the level of efficiency in that regard, the net result is that one simply cannot rely on the service to deliver the letter. A number of years ago, as Deputy Blaney said, there was the much cherished telegram which we all hoped would one day arrive at our doorstep to inform us that we had won £50,000 in the Irish Hospitals Sweepstakes. We no longer have the telegram; we now have the telemessage at approximately five times the cost which is delivered, not in some parts of the country on the day it is dispatched, but the following day and which has exactly the same status as a letter. There are numerous other examples of where the core services provided by An Post are considerably less efficient than they were in days of much less automation and mechanisation.
Debate adjourned.