Seanad Éireann debate -
Wednesday, 20 Feb 1991

Vol. 127 No. 12

Death of Former Members. - An Post Cutback Proposals: Motion.

Mr. Cosgrave

I move:

That in view of the requirement placed on An Post in its memorandum of association to meet the social and household needs of the State, as well as its industrial and commercial needs, and in view of the decision of the management of An Post to implement certain changes particularly the closure of 550 post offices, Seanad Éireann instructs the Minister for Tourism, Transport and Communications to issue a direction to An Post under section 110 of the Postal and Telecommunication Services Act, 1983, to refrain from changes which would have the effect of damaging the social fabric of rural life and increasing the isolation of individuals and disadvantaged groups in society, until such time as it has prepared and published a revised viability plan which the Minister certifies to Seanad Éireann is fully in compliance with the social obligations of An Post under the said Act.

I welcome the Minister of State to the House and with no disrespect to him I hope the Minister will be here later in the light of a possible announcement on an earlier briefing. One of the most striking features of the recent announcement of this viability plan was the manner in which it was published and announced. It was done in a most high handed and insensitive way having no regard for the many real human factors involved. The problems did not arise overnight. I would like the Minister to indicate what discussions he, his predecessor, or Department officials had with the management of An Post prior to publication of the plan. If the Minister had discussions with the management it appears nobody else had any. This is an entirely unsatisfactory state of affairs.

Before any plan is put into operation an essential element is to have a full assessment of the difficulties which have evolved, and which did not start only a couple of weeks ago. The problems will have to be looked at in the light of the services which An Post provide throughout the country. This service has a rural dimension which cannot be addressed totally in a bookkeeper's mind, in a figures adjustment. It is important that the social and community aspect of An Post be fully examined. It is imperative that a full discussion of the problems takes place with the unions, management and various interested people, including postmasters and postmistresses. It is only after a full examination of the difficulties that we can transform An Post and bring what has been termed a 19th century institution into the 20th century, and ready for launching into the 21st century.

I welcome the announcement that either NESC or some other agency will examine the problem to see how matters can best be resolved. An announcement on the television earlier this evening seemed to indicate that any decision had been frozen. One could be cynical and ask if it has been frozen until after the local elections in June. I hope the Minister will take note of my remarks and that this is not a cynical vote buying exercise with the June local elections in mind.

I recall when the Minister was in another position about 14 years ago and we had the most cynical vote buying exercise this country has ever seen with the buy all and sell out manifesto, and the country has been paying for it ever since. I hope the Minister who is new to this job will not go down that road again buying votes in the short term but selling out rural Ireland for the future. While I would welcome whatever report will be produced, I ask the Minister of State to indicate the Government's commitment to some investment in An Post.

Obviously a certain lack of planning in relation to how An Post is to be run is part of the problem we have to deal with. This problem did not happen in the last couple of weeks. What were the Minister and the Department doing about the situation which evolved in 1988-89 when there was a turnaround from a profit of £1.6 million in 1988 to a deficit of £3.6 million 12 months later? Who was managing the books? Who was there to say problems were arising and that action was needed?

I know the Minister is only a couple of weeks in his present portfolio, but there was another Minister there since 1987 and it is important that he puts on the record what questions were asked, what discussions took place and how he was taken by surprise a couple of weeks ago in the Dáil when the plan suddenly emerged. The Minister tried to find touch and get rid of the ball.

The 1,500 possible job losses, the 550 subpost office closures and the various changes which have been mentioned have to be examined in full. Who will be singled out and told they are no longer wanted? What criterion will be used to identify these people? Who will be told they may never work again?

Five hundred of the 550 post office closures will be in rural areas and the remaining 50 in urban areas. From his first-hand experience, Senator Naughten from Roscommon will be further outlining the situation regarding rural post offices, how their closure will affect rural life and how it is not just a simple matter of some bookkeeper at the GPO looking at dots on a map and saying: "We can rub some of those out without regard to the rural communities, to the old, to pensioners or to the infirm". I recall a note in a Monday newspaper which said: "If one of her pensioners does not show up by early evening on pension day then Julia Mannion, the Ballygoolan Postmistress, will invariably telephone the nearest neighbour to check that the pensioner is all right". That is one aspect of the service provided by rural post offices. It is not just a case of pushing forms, pension books or postal orders in one direction and collecting money. The whole fabric of rural post offices has to be looked at.

So far, this matter has been dealt with in a rather highhanded and insensitive manner. This is disturbing. It does not augur well for future industrial relations that so far no discussions have taken place with the unions, but, suddenly, a plan comes on stream which has rocked the country, in particularly rural Ireland. I am sure the Members opposite would admit that they have had many representations about the fact that what has become part and parcel of parts of rural Ireland has suddenly been taken from them by closing post offices. It is the death knell to many parts of rural Ireland which are already suffering tremendous hardship, particularly from emigration.

It is important that the whole question of rural post offices and any possible closures be looked at. The sudden change in the company's finances between 1988 and 1989 has not been adequately explained. Why is that one year they were doing reasonably well and the following year the rot had set in? I do not think the difficulties have been fully explained or outlined. Proper proposals have not been suggested and there is no indication how the company will be turned round. Part of the problem goes back to the time when An Post were separated from the Department of Posts and Telegraphs and the promised injection of £50 to £70 million did not materialise. It was very hard to hand over something which, in certain areas, resembled not much more than the Pony Express but was suddenly expected to come up to provide a service like the Concorde. That could not happen without a commitment and there has not been a commitment over the last number of years with the result that we now have this situation.

Telecom have done a tremendous job over the last number of years. Now we can get a phone within a reasonable time. I remember getting letters from Ministers telling me that within a couple of years, if we were lucky, a phone would by provided for one of my constituents.

It is important that matters relating to An Post be fully discussed. The question of job losses has go to be looked at, how many jobs will go and where. In the report of the plan there seems to be fierce criticism of management. Earlier today we learned that there are nine levels of management: this is another recipe for passing the buck. I remember a recent programme where a post office worker phoned in and said that on the Sunday before Christmas in one of the central post offices there were 19 people sorting and 11 supervising them. What sort of system is that? These are the problems which have to be addressed. We learned today that there is a problem in the operation of the Sheriff Street sorting office. We understand that there are people there on overtime earning two and three times their basic wage. That is unsustainable and indefensible and I am sure all the Members would agree with that. That has to be looked at and changes introduced.

There is the question of how An Post run their affairs. Does it make sense to post a letter in Donegal, bring it to Dublin and then up to Sligo? It does not. The whole question of how post is sorted, divided and spread out into the various areas has to be looked at. There must be regional offices. There should not be this albatross around the neck of An Post, which is partly Sheriff Street. This matter has to be looked at.

The unions have put forward certain proposals, some of them are probably realistic, others not. The unions have to look after the welfare of their members. This matter needs to be resolved for the benefit of long term industrial relations in An Post. We all remember the 1979 strike which crippled us and we do not want to see a similar situation developing. This problem will only be sorted out if there are full discussions following the report. In relation to the report which apparently the Minister has requested from NESC, will he act on it? If it does not suit him, will he act on it? He has to take decisions. I ask him to make it clear in his reply that this report will not be put on one of these merry-go-round committees which will not report back for many a year. This has been the way with other matters which have been kicked to touch, given a good old Garryowen and kept up there for quite a while.

(Interruptions.)

Mr. Cosgrave

I am sure Senator Cassidy's concern for the subpost office in Castlepollard is similar and I am sure he will be defending its right to remain there, and to help him out in June.

Obviously, how post is delivered around the country has to be looked at. There are advantages in using the railways in certain areas but there are other areas where if a train arrives late, the bus meeting it will have departed and that post can be delayed for a day. Obviously that is not satisfactory. There has to be co-ordination. We had mail train robberies here in the past. Is the Minister satisfied about the security aspect of lorries of articulated trucks bringing post because there are valuables such as money, parcels or cheques in these trucks. It is important that matters such as the security and confidentiality of An Post be addressed.

Another question which has arisen is the roadside boxes which are to be introduced in various places particularly in rural areas. Is there any feedback on their viability or suitability so far because in this country we vandalise phone boxes, write graffiti on walls, vandalise public toilets and toilets in public houses. Will these boxes be interfered with? Will the security of post be interfered with? It is important that the operation of these boxes be considered.

An Post have got to change and look ahead at their costs and how they are competing. They have to be financially viable and withstand competitive pressures. They have to look at new systems like the box and other telephone systems. Postal systems may be redundant. There has to be an investment programme and a commitment to bring An Post into the 21st century. Costs must be looked and also the fees paid to postmasters for payment of bills. They have got to think of themselves as a bank. The building societies are going in that direction and there is no reason why An Post cannot do so as well. These matters will have to be addressed in the coming months.

The matter of overtime has got to be looked at. Before definite decisions are made full discussions have to take place with the unions because it appears from the plan so far that every matter has not been taken into account, that An Post are pushing a certain line. Job losses have got to be looked at.

The Government have failed to provide for investment so there has been little incentive for An Post to get into other areas. We have had the debacle in relation to the collection of TV licences and An Post are talking about contracting that out. I would have thought if that was done properly and if they fought their corner with RTE that should be a profit-making exercise. I would also have thought that with the number of people fined in the District Court for not paying their licences there should be extra money there.

Matters such as the closure of rural post offices and the difficulties that will pose for the old and infirm, who may not have other means of transport to go to another village, five, six, eight or ten miles away, the security of post, the vandalism of the boxes all need to be examined. For many people in rural areas An Post is their main link with their emigrant son or daughter in Kilburn, Sydney, Boston or San Francisco. If the Minister is postponing decisions prior to an indepth examination it is important that he states specifically that he will have a report back by a certain date and that there will be a commitment from Government. I hope it is not being done in an attempt to buy time before facing an electorate in June. I know some of the people opposite are getting more nervous as June gets nearer. The electorate will eventually catch you, Senator Cassidy.

Mr. Cassidy

Will the Senator speak for himself?

Mr. Cosgrave

The Senator and the Minister should remember that while they may be able to run they will not be able to hide when eventually the electorate catch up with them. It is important that lessons be learned as a result of what has happened in the past few weeks. The development of An Post should be looked at, the social impact, the job losses and the effects on rural life and on business. An Post have a future with the right approach but they will need a commitment from the Government in relation to cash. There is talk about a computer system at a cost of £20 million. The figure of £14 million will come from social welfare and An Post will provide the balance. The Government should be able to come up with the balance to ensure that we have a postal system we can be proud of and one that will be used. Why are people employing couriers, and other methods? If one posts a letter in Donegal to an address in Sligo it does not make sense that it has to come to Dublin.

I ask the Minister when replying not to think he can get out of this situation by kicking the ball to touch and hoping that the ball will not come back into the field of play prior to June. If he is sincere in relation to his commitment to An Post and his statement that he was surprised with what had evolved I ask him to talk to his predecessor and to the officials in his Department and ask them what knowledge have they about the matter, what plans were brought forward and what discussions took place.

This is a very important motion and debate. In the Minister's constituency he must have had representations on the matter. I ask him not to ignore the problem, to be frank with this House in his response and come back with a plan that has been fully discussed and which can keep An Post as a viable service in this country.

Mr. Naughten

I second the motion by Senator Cosgrave. We are dealing here with a very serious situation which will have widespread implications for vast sections of the community, but particularly for the rural community. We have heard Senator Cosgrave outline the difficulties experienced by An Post and the drastic changes which they wish to introduce. I would be the first to acknowledge that major changes are needed within the organisation. Any organisation which is losing money at the rate An Post is losing it — and I have their report here which states that their loss for 1989 was £3.6 million, the estimated loss for 1990 was £9.8 million, the loss forcast for 1991 is £16.1 million and the loss forecast for 1992 is £15.3 million — has a cancer within it. I do not believe however, that the rural communities should be the people to pay for mismanagement, whether it occurs now or goes back over a number of years.

Senator Cosgrave has very clearly outlined the ludicrous situation where you have 19 people working and 11 supervising. The Department of Post and Telegraphs together with An Post have failed to break the grip of the unions in some of our large sorting offices. Let us recognise that and recognise also that there was a major problem there which the Department of Communications were unable or unwilling to deal with. I remember as a member of the Committee of Public Accounts that the Comptroller and Auditor General drew the attention of the committee to equipment which was purchased for Sheriff Street sorting office; three years later that equipment was still lying in stores in London being paid for at the taxpayers' expense because it could not be brought in or put into use. That was a scandalous situation. We seem to have continued on the merry go round since An Post took over and hence the problems that we face today are major ones. I regret the way An Post and the Minister, who it appeared at one stage was prepared to go along with this programme, have attempted to deal with this situation by eliminating 550 subpost offices and by regarding district and post offices in our towns and villages down to subpost office standard or district standard. There will be huge job losses in many of those small towns where people will be unable to be re-employed. In many of those towns like Boyle, Loughrea and Ballinasloe, many of the people concerned will be married with a mortgage, and they will not be able to get another job in that town and will be faced with the prospect of unemployment for the rest of their lives.

It is no reflection whatsoever on our Minister of State, whom I respect, that I state my belief that this House has been treated with discourtesy by the Minister regarding this very important debate. I was watching the 6 o'clock news and I heard the Minister make a statement with regard to this particular motion before the House. The Minister is treating this House with discourtesy by not coming in and listening to this debate. I want to put that on the record.

Acting Chairman (Mr. McKenna)

I believe the Minister will be coming in. He has been delayed.

Mr. Naughten

He has not been here for the start of the debate and the fact that he went on the news earlier today pre-empting this debate is somewhat regrettable when he is not here to listen to the debate. I also pointed out the lack of technology and the inability of An Post to adopt new procedures and new technology.

Senator Cosgrave highlighted the situation where a letter posted in Donegal must come to Dublin to be sent to Sligo. That is a disastrous situation and one would have to ask whether it was within the powers of the Department of Tourism, Transport and Communications or An Post to have this situation changed long before this. It seems as if industrial relations procedures are unknown in this particular organisation and in that report one sees quite clearly that top management recognised that there are too many layers of management and yet they are not able to implement a good industrial relations programme. There are supervisors, managers and other grades. It is physically impossible to operate an efficient service in this way.

The courier service has crept into this country over the last four or five years. Daily we see their vans going from east to west and from south to north. Why was an organisation like An Post not able to cash in on that market? Why were they not able to compete with private enterprise? They were set up and had the structures yet private enterprise came in and were able to provide a service which the postal authority were unable to provide. The practices over the years have been diabolical. They are now about to use a sledgehammer to crack a nut and they are approaching the issue very wrongly. It would appear that it is the rural community which will suffer as a result of mismanagement and bad managerial practices over the years.

We are faced with a price increase of seven per cent, which is far above the level of inflation. We have the increase in ESB charges and in telephone charges but they exist for another reason. Postal orders will increase in cost by 10p in some cases and by up to 85p in other cases. I would like to know what percentage increase that is. I would hazard a guess that it is far more than 7 per cent.

We must all recognise that in rural Ireland the postman was part and parcel of rural culture. It was the postman who brought the cheques from whatever source, whether they were headage payments, unemployment assistance or whatever, and he became a weekly visitor to many rural homes. He provided many social services to elderly people living in remote rural areas. That service is now unfortunately going to be cut away. There was an attempt by An Post two years ago to instal green letter boxes. We were told that it was voluntary, but if you did not refuse the letter you got stating that the green box was put in, it became mandatory, and they were put in in certain cases against people's wishes. They will now go in. Services will not only be removed from many of the remote rural areas, but the report states that as a general rule An Post employees will not traverse private roads, lanes or avenues, or minor public roads which are sparsely populated. In other words, most of rural Ireland will be deprived of a postal service and instead of having the postman call, we will have these little green boxes on the sides of roads.

Senator Cosgrave asked how anybody can guarantee the security of the green letter boxes. Will people have to travel two miles down a county road to wait for the postman to come to the little green box? Nobody can guarantee what time he will come. My postal service has improved somewhat over the last 12 months but prior to that I could get the post at 4 o'clock in the afternoon or at 11 o'clock in the morning. Will these people have to stand by the green box to collect their post or will somebody have taken it by the time they got there? It is a ludicrous situation.

In that area we will have huge redundancies among the people providing that service. Postmen will be more affected by the redundancies than any other single group. If you eliminate the service of the postman delivering letters to a private driveway or cul-de-sac. I can see a situation where one postman will deliver to the green boxes the same volume of post that four men are dealing with now. You are going to have a vastly inferior service and there will be a risk to security.

We come then to the rural sub post offices dotted throughout the country which were providing a service for the old age pensioners who went there on a Friday morning as a sort of social visit. They met their friends there, they visited the local shops in the local villages and bought their groceries. Now that service is going to be eliminated from many of our small rural villages and they will have to go to the towns to collect their old age pensions. The same will apply to the people on unemployment assistance who, up to now, went to the local Garda station, signed on and went to the local post office and collected their money. Now, in the absence of the local post office, they will have to go to the local employment exchange and instead of signing on at the local Garda station will have to go further afield with the humiliating prospect of queueing for three to four hours. These are not people who are permanently unemployed, it never stated such in the terms of the scheme. They are people whose income is not sufficient to maintain them. I am talking about those who are drawing farmers' unemployment assistance. They will have to queue up for three or four hours and wait to get their money. It is going to change the whole scene in our rural towns and villages. All that business is going to be lost to the small towns and villages and people will be obliged to go to the bigger towns to collect their money.

I must refer to the Minister's reply in the Dáil. I want to quote from the Official Dáil Report, column 2136:

I do not see a need to direct An Post to provide any lossmaking service as provided for under section 51 of the Post and Telecommunications Service Act, 1983. That Act gave An Post a commercial mandate and I am satisfied that the course of action suggested by the Deputies is not warranted.

These were the Deputies who asked the question.

My statutory involvement in the operation of the plan is, therefore, limited to the approval of price increases and borrowings provided by An Post. Implementation of the plan is a matter for An Post and I do not propose to interfere with the company in that regard.

Let me first congratulate the Minister on his about-turn and, of course, congratulate the Government backbenchers for forcing him to take an about-turn. If it were not for the stand taken by some of the Fianna Fáil backbenchers and indeed by Senator Cosgrave in putting the motion before the House here tonight, I know the Minister was not sure he could have got the amendment carried without making this announcement today. We welcome the about-turn by the Minister, but one has to ask the question: is it buying time for local elections? That question must be asked and that is an answer I want from the Minister when he is replying.

What is going to happen with this report the Minister has sought? Is he going to accept it? How different will it be from the report which we were told took a lot time to prepare and which involved careful and detailed study; it was the bible on 7 February? Now we see the whole thing being re-examined. One cannot blame us for asking the question: why is this examination necessary now? If, on 7 February, that document was as good as it was supposed to be, what alternatives can we have now? These are questions I expect the Minister to answer when he comes back to reply.

I believe that the closing of our sub post offices — 550 of them throughout the country — will have serious social implications for many rural areas, apart from the economic implications of people drawing their pensions elsewhere and not doing their business in the local village. It has also been pointed out, very forcibly, by Senator Cosgrove that, if an elderly person did not draw their pension, the postmistress or postmaster, would ring up to find out if that person was all right or ring a neighbour in the area. That service is now gone. Nobody will know whether that person is sick or whether that pension has been collected.

Again, you have the issue of the green box, the aspect of security and the right of people to have their post delivered to their homes. Do not forget that in what we were led to believe were the bad old days, the postman came on his bicycle and delivered the post to the person's door. One of the things for which An Post and the Department must take a lot of blame was the old system whereby the postman did three or four hours per day, running his own car and getting a small allowance for that. After regarding was introduced, those people were let go and the permanent postman was brought in. He had a van from An Post at great expense to the State and we had the motor service which we now see collapsing.

I appreciate the time difficulties and I will conclude by asking the Minister to explain why, first, he changed his mind on 7 February, secondly, what he is going to do with the NESC report when he receives it, and thirdly and most importantly, if this is not a holding operation until the local elections are over.

Mr. Cassidy

I move amendment No. 1:

To delete all words after "That" and substitute the following:

"Seanad Éireann supports the Minister for Tourism, Transport and Communications in his recent decision to engage in talks with An Post in relation to the Company's Viability Plan and urges him to take full account of the economic and social role of the sub-Post Office network.

I realise the seriousness of the situation and recognise it here in this motion that comes before the House. As a former employee of An Post I know the situation behind this proposal. An Post is a viable national asset which provides both economic and social services to all. It has many important functions to carry out. It collects our TV licence payments, pays social welfare payments, operates savings services and forms the nucleus of most rural villages and towns. In our major towns it is one of the central institutions where people have met since the foundation of the State. Now everyone has to look into the day to day costs of running all its various operations. An Post finds itself in its present position as a result of changing technology. We have only to look at the fax machine to realise how it has helped industry and has resulted in a three minute delivery of a letter. It has enormously affected the business post as we knew it in the past. It has many pluses for speeding up business. It must bring in extra income through its use of telephone lines and that is a plus for An Post also. We have speakers on the opposite side who are very concerned about the future of An Post.

I must compliment An Post on the way that they are marketing the St. Patrick's Day card at present. There is a whole new emphasis within An Post and there is a whole new marketing plan very evident to us all. Only last week on one of the major TV programmes, it was noted how well they marketed the St. Patrick's Day concept in their postcards. While we are having a look at the whole set-up of An post, it is only fair to acknowledge that fact with the national feast day to hand. They are doing an extremely good job.

The proposals before us in the document which was presented to us by John Hynes have far-reaching implications. As one who comes from the rural constituency of Westmeath-Meath it is very sad to realise what effect a saving of £1.5 million is going to have on rural Ireland in particular. In country villages where there is a church, one or two shops and a school, the post office may be the only place in that area giving both a service and employment to a family. I question whether that is costing £1.5 million because these people are more or less self-paid agents on turnover and self-paid agents on turnover only make enough to get by with a few hour's employment per day. I would be totally opposed to anything happening to any of those rural post offices. That would be a sad day for rural Ireland.

Members will have heard my namesake, Bishop Cassidy, testify that rural Ireland is being decimated by emigration. As legislators, we should be doing all in our power to preserve the life of rural Ireland which has been near and dear to most people down through the years by maintaining employment in these areas rather than coming up with silly proposals which are going to save £1.5 million. Under no circumstances could I go along with the proposal and I cannot see it getting through any of the Houses of the Oireachtas. As much as I respect the two Senators opposite, their suggestion that it could be a cheap ploy for a local election, does not express the policies or ethos of Fianna Fáil, who have proven how responsible they are over the past 60 or 70 years at running the affairs of the State.

We are all aware of a spate of breakins over the past number of years. People were afraid in their own homes. Various groups pooled ideas at community level to protect people living alone in homes where they had been born and bred. To suggest that we would have a box collection to deliver the mail to these people is absurd. I would not mind if the suggestion was for all Ireland. Is there going to be one standard for rural Ireland and another for the big cities and towns? I think that is unconstitutional and anyone who suggests the like had better think again. I do not care whether they are Ministers; it is totally unacceptable. As one who used to visit people in those areas and has first-hand experience of the situation I am aware post people are the only people they might meet once or twice a week.

The person or accountant or team of advisers who came up with this suggestion does not understand the day-to-day operation of postal delivery in this country. They are looking at it only from a financial aspect and as a book-balancing exercise. I remember back in the sixties that the post office was known as a company who paid badly and the postmen down through the years got poor financial reward for going out in all kinds of weather and giving a service. It is good that standards and facilities have improved and that the service in general has improved. We have a first-class door-to-door service at present.

What I am saying here this evening is, leave it alone, take your hands off, it is not for sale and it is not for auction. Under no circumstances as Members who are elected by people from rural Ireland, are we going to accept this no matter where it takes us. That may be strong language coming from the Communications spokesperson for the Government in the Seanad but I think it has to be said loudly and clearly. For the saving of £1.5 million this great national asset is not going to be taken away from us. I can tell you that there are certain projects in this town that are costing An Post £10 million, £15 million and £20 million in the year in comparison with the £1.5 million cost of the door-to-door service.

I want to congratulate the Minister. I have known him for many years as a very efficient man and as one who is dedicated to the office he holds. He has been a public representative. He was not one day in his present portfolio when this was presented to him and he has taken instant action. I want to congratulate him for coming in and for calling for this study which I hope is going to take place. There has to be an alternative.

We heard Senator Naughten point out the major inconveniences it would cause in rural Ireland if the rural post office were not there. A number of jobs would also be hit. If a family in a rural post office lose their job, what happens? They will go on unemployment assistance which is known as the dole. It is absurd that anyone should have to do that. It is going to cost the State far more than £1.5 million if those people go on unemployment assistance. This proposal will do away with a service that has taken us years to perfect. It is going to cost us more to take it away and to pay people to do nothing. This is an insult to the intelligence of legislators here representing the people.

Mr. Cullen

We were expecting an opportunity to get in on this debate. We thought the Labour Party were to speak next and if they choose not to turn up to speak on this important debate the Progressive Democrats are next in line to speak.

Acting Chairman

I am advised the debate must cross the floor of the House.

Mr. Cullen

I was advised otherwise by the Whip.

Acting Chairman

I am advised here that the debate must cross the floor of the House.

Mr. Cullen

The debate was to cross the floor of the House, as I understand it, to the Labour Party whose members have not turned up to speak in the debate.

Acting Chairman

It does not necesarily cross to the Labour Party; the debate just crosses the floor of the House irrespective. It could be to Independents, to Labour or to Fine Gael. The debate has to cross the floor.

Mr. Cassidy

It was to be the Labour Party.

Mr. Cullen

What time is the Minister due to speak?

Acting Chairman

The Minister is due to speak at 7.45 p.m.

Mr. Cullen

I ask my colleague on the far side of the House if he could give me five minutes of his time.

Mr. Mooney

As the junior spokesman on the Government side I have also indicated my wish to speak. I am afraid I could not agree with Senator Cullen on this occasion because of the shortage of time. If there is any sharing of time, I would appreciate if Senator Neville would share it with me as I am next in line.

Mr. Neville

I am quite happy to share five minutes with Senator Cullen.

Mr. Mooney

I am sorry but I would be the next Government speaker.

Mr. Neville

The Government obviously have not decided who should be their next speaker.

Mr. Cullen

It has been agreed that the Progressive Democrats could speak on this matter and I am the Communications spokesman for our party. I checked this both this morning and this evening. I am dismayed and surprised that this has occurred.

Acting Chairman

I am sure Senator Cullen will appreciate that I am being advised on the proper procedure. Senator Neville has agreed to give Senator Cullen five minutes of his time, with the agreement of the House.

Mr. Mooney

I cannot agree to that.

Mr. Neville

I am quite happy to take my full time.

Mr. Mooney

Senator Neville should continue.

Mr. Neville

I support this important motion before the House. My colleague Senator Cosgrave, proposed it and I wish to support his excellent contribution. Coming from rural Ireland, I have a particular interest in this and all issues dealing with rural areas. Over a number of years, we have seen the destruction of the rural fabric of society. We have seen mass emigration, migration to our capital and the growth of services in our capital to the detriment of rural areas. I know there are proposals to close railway stations and connections. Iarnród Éireann have on hold, although not yet published, a decision to close some of the railway links between various towns. Just some weeks ago we saw, without any fuss, the removal of some goods rails services. This trend is endemic in rural Ireland. We have seen the closure of many ESB offices or sub-offices. I can instance one very close to me in Rathkeale. We have, hanging over us, the GATT negotiations and the decision by Commissioner MacSharry to introduce policies which will seriously affect farmers' incomes.

It has been indicated to me that it is acceptable to give five minutes to Senator Cullen. Is that acceptable to the House?

Acting Chairman

I am quite amenable to that. If the House agrees, that is quite in order. Agreed.

Mr. Neville

The proposed closure of rural post offices is another chapter in the dismantling of rural life. The post office is a social centre. It gives a service that draws people into rural towns. The activity and the commerce that was generated in small villages will now go to the larger towns. This is one of the more serious effects of the decision to close rural post offices.

Most small rural post offices are in areas which are not served by public transport. It is important to state that the closure of such post offices will put pressure on people dependent on social welfare and on pensioners who have served our State and paid their taxes their working lifetime. Now they will have to obtain transport to the bigger towns. I know of one place where people will have to travel four or five miles to the post office in the nearest town. They will be dependent on their neighbours and relatives for transport. They will lose their independence because they will now be obliged to depend on others to help them get their pensions and social welfare payments. This is unacceptable. I recognise the Government's dilemma in trying to head off An Post's decision.

I hope the Minister will categorically state tonight that the long term survival of the rural post offices will be guaranteed by him over a period of years rather than postponing the event under the cover of new reports, different ways of obtaining cost reductions, and so on. What we need is a firm long term commitment that rural post offices will remain open. If their intention is to delay this move until after the local government elections or for any period An Post will be obliged to cut even deeper when introducing their proposals.

The social dimension of An Post is enshrined in legislation. We cannot ignore that. In the Programme for Economic and Social Progress it is stated in relation to commercial State companies that non-commercial obligations are to be clearly defined and taken into account in assessing company performance. The performance of An Post must take into account — and this includes the financial performance — the cost of providing the social service. The EC Commission Green Paper, which is due to be published soon, states that the Community will investigate whether it would be appropriate to make Community funds, or other funds, and support available in order to help certain regions which at present do not have the advantage of a fully adequate postal service but which do not have the resources to invest to achieve them. If the Government make a proper case to the EC for funds to retain rural post offices and a rural service, such funds should be forthcoming.

I object to the proposed roadside post boxes. As somebody who will be directly affected by this, I know the advantage of a daily service, and appreciate it. If I had to travel half a mile or a mile to collect my post, I would not be getting the same service as my brothers in urban areas.

Mr. Cullen

I thank Senator Neville for sharing his time with me and for giving me an opportunity to speak on this important debate.

I support the Government's amendment. It is right and proper that the Minister who has just taken over this portfolio should have discussions at all levels to arrive at the proper way forward for An Post. Mr. John Hynes, the chief executive of An Post, is to be congratulated for bringing forward a viability plan in the first place. It is the type of discussion document necessary for the development of An Post and that, in itself, is important. Every plan that is produced leads to discussion. I hope that out of the discussions that will take place the way forward for An Post will emerge.

What we are faced with is the classic example of a company which failed to revolutionise their operation. Modern technology was not implemented in this organisation over the years. What has happened is that instead of having a phased implementation of modern technology married with the traditional methods for the last decade and a half the company is now faced with implementing modern technology in one go. This will lead to major difficulty and trauma for all those involved in An Post.

It is tragic that this debate is dominated by the closure of sub-post offices. I, as a rural Senator, see this as an important issue, but the whole debate on An Post and its future is being focused on one issue. This is a sorry and tragic situation for all those involved in An Post, both on the union and management sides.

With regard to sub-post offices, I do not accept that their closure threatens the fabric of rural Ireland, and I mean that in the best sense. It is wrong to use that type of argument. Fine Gael are being mischievous in using that kind of emotive and outlandish language which does nothing to serve the purpose of a very important company that is at the heart of our economic development. There is room for the retention of a certain number of sub-post offices, but time will tell how many. I will await deliberations in that area.

Mention was made of the social aspect of post offices, for example, the lady in the post office who rings the pensioner if he or she does not collect their pension and looks after things for them. That is marvellous but there is a sense of transferring to the postmaster or postmistress responsibility for the aged. This is a commercial company and must operate in the real world. They are not responsible for anybody's social conscience.

It is being put about that there will be no postal service in rural Ireland; that is another ludicrous statement. It does not enter into the argument at all. The people will receive the efficient and modern postal delivery service to which they are entitled. If there are social questions they should be debated, and rightly so. However, we must not lose sight of the fact that An Post must develop in the interests of all. It has more of a contribution to make than just delivering post. If we look at the development of these services throughout Europe we will see the need for An Post to compete not alone in national terms but in international terms. The debate then moves into the arena that I believe John Hynes tried to take it before it was hijacked for political reasons which were not for the benefit of An Post or the people.

I thank my Fine Gael colleague for allowing me time to speak. I am sorry I did not have more time but I hope the Minister, whom I am glad to see has arrived, heard some of the points I made and I hope that is the way he will approach the position of An Post.

Acting Chairman

I appreciate the Senator's difficulty but I hope he appreciates my circumstances in terms of procedure. I welcome the Minister to the House.

Minister for Tourism, Transport and Communications (Mr. S. Brennan)

I thank Senators who participated in the debate. My colleague, the Minister of State, Deputy Lyons, has told me very briefly of the Senators who spoke. I appreciate the points made and will study them very carefully.

At the outset I would like to put the facts before Senators, as presented to me by An Post. The company is in a serious financial position and there is a need for urgent action to restore the company to profitability. The company lost £3.6 million in 1989 and an estimated £10 million last year. On current postal rates, An Post would lose £16 million this year and incur accelerating losses in the years ahead. Unless remedial measures are taken, An Post will be insolvent in 1992. The main reasons for An Post's problems are increasing operational costs, low mail volume growth and competition from modern telecommunications services and couriers. Overall costs will have risen by 21 per cent between 1987 and 1991 while revenue will have increased by only 11 per cent in the same period. It is clear that An Post face a financial crisis.

An Post considered this crisis and announced proposals to redress the situation and return the company to financial health. The programme which the company announced has the objective of achieving £24 million savings by 1995. The main features of An Post's cost saving proposals include the following: single daily deliveries nationwide; rationalisation of the sub-post office network by closing 550 sub-offices — there are, 1,955 sub-offices in the current network; the provision of 200,000 roadside letter boxes; retitling and redundancy at some 50 of the company's own 95 post offices and closure of the central sorting office and its replacement by a new modern mail processing centre.

As regards retitling and redundancy at some 50 of the company's own 95 post offices, I heard on radio recently a list of 25 areas. It would be a pity if the view was formed that these offices were to be closed down. I want to state quite openly and solidly that these 25 post offices are not being closed. They are being retitled but there will be some redundancies. The offices will be operated on a contract basis in a more commercial way than is currently possible. There will not be any closures. This is the list I heard on "Morning Ireland"; Athenry, Ballinrobe, Ballyhaunis, Ballymote, Belturbet, Boyle, Cahir, Caherciveen, Carrickmacross, Cashel, ,Castleblayney, Clifden, Clonakilty, Clones, Cootehill, Curragh Camp, Kildare, Kilrush, Kinsale, Loughrea, Macroom, Muine Bheag, Rathluirc, Roscrea and Youghal. I want to make it quite clear that that is the list I heard on radio. It would be a pity if there were any proposal from An Post to close these offices. They propose to have redundancies in the ordinary way and to change their method of operation to a contract basis. I want to make that clear because there was considerable misinformation on that point.

These proposals reflect An Post considerations that if rationalisation is to be effective substantial savings will have to be made in the area of mail delivery as about 75 per cent of the company's business is in the mail service and delivery is approximately 65 per cent of mail costs. Unfortunately, a feature of rationalisation and modernisation is a reduction in the workforce and, in An Post's proposals, would result in 1,500 job losses or 19 per cent of its total workforce. I understand that £20 million is paid in overtime by the company. I know that the company plan, as I do, to have a very close look at that. Early retirement and severance terms will be negotiated and it is expected that these job reductions will be effected voluntarily. An Post's proposals will involve capital expenditure of £64 million over the next five years. This figure includes the capital expenditure that the company would incur in the normal course, such as vehicle replacement, computers and buildings. Capital expenditure specific to the proposals is mainly for the provision of roadside letter boxes and a new letter mail processing centre at Naas Road, Dublin. The company would have to borrow some £50 million to fund this capital programme. According to An Post, with full implementation of its proposals they would expect to be back in financial health by 1995.

An Post simply must return to financial health and it is clear that significant savings and some paid are required to do this.

I had discussions with An Post on its recovery proposals. I have instructed the company to continue its negotiations with staff representatives with the clear objective of effecting a recovery in the company's financial position. However, I am seriously concerned about possible social effects on rural communities of the proposals to close sub-post offices and the provision of 200,000 roadside letter boxes.

I have, therefore, instructed An Post to review these aspects of the company's proposals in the light of a study which the Government are asking the National Economic and Social Council to conduct of the socio-economic implications of the proposals, including an examination of alternative possibilities for increased revenue at the sub-post offices, hardship alleviating measures and other options. Pending the outcome of this study and its consideration, I have required An Post not to proceed with these two aspects. I will, of course, continue to monitor these and other aspects of An Post's recovery proposals.

Mr. O'Toole

Most parliamentarians had the same view when they received from An Post the recent proposals to tear apart the service of An Post as we knew it. Members of the Communications Workers' Union have outlined to me their very real concerns. I have not had time to assess in detail the Minister's proposals but I have one very serious concern about them. I share the Minister's anxiety and concern about the closure of sub-post offices and the provision of the 200,000 roadside letter boxes, but I am worried about the Minister's thinking in asking An Post to consider implementation of cost saving proposals. I would like a guarantee from the Minister that this will not result in An Post looking for savings in the area of additional job losses. I am glad the Minister has indicated that that is not the case. Many workers in the communications area and An Post will be very relieved to hear that. There is a clear understanding that we need to create savings and many workers will be concerned about that.

Politically it would be an unsavoury decision to close the sub-post offices and it would have a detrimental effect on the social fabric of rural Ireland. Nevertheless we do not want them to turn around and say since we have not been able to make the savings by closing sub-post offices we will now try to achieve the savings by eliminating jobs in An Post. The Minister has indicated that that is not the thinking but I would welcome a guarantee from him in that regard.

The proposals have been a slap in the face for workers in An Post. I do not know of any group of workers who have been so pliable and amenable to proposals to change and so ready to make a sacrifice in favour of their company. They have, over the last number of years, had agreements on job losses and voluntary redundancy schemes. They went along with proposals which were unacceptable to many of them but they accepted them in the interest of creating a viable, profitable company. The way this plan was thrust upon them so suddenly was utterly unacceptable. I want to put on record that I welcome the Minister's intervention and the fact that the main thrust of the proposals has been set aside. I hope we do not think that the financial health of the company can be achieved at the cost of the jobs of those workers who are committed to making An Post viable.

In this day and age we must consider their position in a European context and in the context of our huge emigration. We will always have more inward than outward mail. This is the reality and because of that it will be very difficult to get our costings correct. We are on the extremity of Europe and, in that sense, we are disadvantaged. The Minister will be aware of discussions which have taken place recently at European level and of the consensus for a uniform postal service. There can be no question of a lesser service being available or a service which does not have the same quality in one country as opposed to another. Where one country might be more disadvantaged than others, perhaps Europe should be prepared to subsidise their postal service. I did not hear the earlier part of the Minister's speech and I wonder if that has been addressed. There is a consensus in Europe that in disadvantaged areas the postal service needs to be supported and subvented through European Funds in order to ensure that there is a quality uniform postal service available through Europe. I think that is sine qua non. We need to address that fact.

I am glad we have not allowed what would have been a catastrophic set of proposals in terms of our social fabric and of the morale of workers in the postal service. I welcome the Minister's intervention and the fact that he has indicated that he does not see the savings which An Post hopes to achieve being achieved through further redundancies; by that I mean more than those outlined in their set of proposals.

In these kinds of negotiations nobody puts the real deal on the table at the beginning. The question must be asked: did An Post intend implementing this set of proposals? They were so utterly unrealistic that I do not think they had the slightest notion of implementing them. We should not feel we can sit back now and take it easy because the implementation of the reduced set of proposals will create serious hardship for the workers who have given generously to help An Post retain some level of financial viability.

Will the Minister say if he believes the postal service can become profitable? How much of it is a social service and how much of it is a profitable business? Are we not moving more and more towards electronic mail? The more we move towards electronic mail and towards instant communications the more we take from the potential business development of An Post.

I hope the changes which are proposed, and which I welcome, do not mean a deterioration and a worsening of the proposals which had already been on the table in regard to job losses and redundancies.

Debate adjourned.