Feargal Quinn (Independent)

The Minister appears to be getting fond of us as he has been visiting the Seanad quite regularly, although this is the first time he has come to discuss this topic. He is welcome.

I am delighted to speak on this Bill. I was chairman of An Bord Poist for four years and chairman of An Post for six years and I made it my policy when I became a Member of the Seanad not to speak on postal matters. One does a job and one steps out of it and it did not appear right to come back to it afterwards. To a certain extent, after all these years I am breaking that promise I made myself. I recall when we came up with the name of An Post, the then Minister responsible at its launch said, "And in English it will be known as-----". I had to run over to him to explain it does not need a translation. "Post" is the term in both languages; tourists, for example, would understand it immediately. The name has worked very well on that basis.

Back in the 1980s I was impressed with the workforce's talent in the postal service and their concentration and dedication to service. This was a talent that was to a certain extent strangled when the service was run as a Department. When the service was given its freedom, it was a joy to see this talent emerge.

The then Department of Posts and Telegraphs was divided between An Bord Poist and An Bord Telecom. There was a bit of competition between myself and Michael Smurfit, chairman of the latter. It seemed to have plenty of money, taking four-minute radio advertisements while An Bord Poist had no money to launch An Post. I remember inviting half a dozen top marketing people to dinner one night to see how we could handle a launch without the money. The idea came up to charge only for a one penny stamp for all handwritten letters on the day of An Post's launch on 1 January 1984. The handwritten letter clause was to avoid banks and commercial companies using it and resulting in a drop of income. The campaign went very well. It was assumed at the time that it would cost us money. One in four who received a penny letter felt obliged to reply and four days later there was a huge boost in business with the full postage cost being paid.

I have great memories of the people in An Post and their enthusiasm. I am concerned as to how we will hold on to that same measure of enthusiasm. I accept that nothing stays the same in any business. Like many other forms of retailing, the postal service is a high-volume, low-margin business. In 1983, I first saw a fax machine which I thought would threaten An Post's future. We do not see any of them now. The Internet and e-mail had yet to be invented. In the 1980s we referred to the public users of the postal service. Only when we changed to referring to "customers", were we able to make changes.

Mail volumes have fallen a massive 16% since the start of 2009, with each 1% drop accounting for a loss of €5 million, as traditional letter-writing dies out and consumers turn to e-billing. An Post has indicated it will have to cut staff numbers by more than 400 by the end of the year.

The postal service is not just any business that is being knocked to one side because of the Internet. It is a public good. Post offices unite communities and the postal service connects remote regions to the centre. In the context of the future Common Agricultural Policy and stimulating rural areas, it is necessary to increase the attractiveness of rural areas by ensuring access to different public services and infrastructure, such as education, health, broadband Internet, transport and postal services.

However, one of the constant problems in the background in this country is that of dispersal in rural areas which results in increased costs in many areas such as energy, transportation, etc. I visit France regularly. There I have noted in some towns and villages, the post is no longer delivered to one's door. Instead post boxes are located at the front of estates and so on. This idea must apply in so many other ways such that the concept of bungalow blight does not make sense.

Expanding on this point, with physical addresses changing so quickly, very often an e-mail address remains the only constant. SendSocial, a start-up company in the UK, has seized upon this idea and allows consumers to send packages to people even if they do not have their postal address by providing an e-mail address, for instance.

SmartPost is a similar new innovation from Estonia. Given that the postal service there is poor with no nationwide courier services, SmartPost has developed a system of lockers and tied them together with sophisticated software. Online and catalogue shoppers can have goods delivered to one of 36 locations. To open the lockers, the firm sends users a text message with a code. The concept means the collection points are near to where people are, meaning mostly in supermarkets. The French postal service has a similar locker system with lockers on avenues or major transport hubs. It could be near home, office, holiday location or train station. For the sender, it is very simple - one address, one e-mail. The recipient stays in control of where the item goes and they do not have to be there to wait for the package to be delivered.

These types of systems would seem to make sense in Ireland with its dispersed population. Can post vans in rural areas do more than deliver letters? In Scotland, they act as minibuses too. Does An Post consider buying minibuses instead of vans for this purpose? Surely, they would not be much more expensive than a van. We experimented with this in the 1980s in An Post. It is a business idea worth examining.

As we look at falling demand for postal services, should we be scared of private operators coming into the market? The unions in An Post have some concerns about this. There is the argument that private sector companies will be purely in it for profit. Some postal service experts, however, believe that private postal operators are, by and large, better positioned to cope with falling demand than State-owned operators.

For example, Deutsche Post and the Netherlands TNT Post, both privatised, have diversified into parcels and express deliveries and are as efficient as postal services get. Deutsche Post, TNT Post and Belgian Post have invested for the long term. Deutsche Post has invested in acquisitions at home and abroad, TNT in foreign expansion and Belgian Post in automation. Since Sweden's Posten AB was privatised in 1993, prices for business customers have fallen by around 30%, although they have risen for consumers. I recall when working with An Post any suggestion of different prices for different customer types was almost a heresy. If we could get a postman delivering six letters to the door rather than one, then more business, and accordingly profit, could be developed at a lower price. In other words, one would bring the price of a stamp down. Direct marketing had not been used until then and was in its infancy. At the time 500 letters per capita per year were posted in the United States; the figure in Britain was 200. In Ireland, however, it was only 100 because we had traditionally charged a high price. In the budget the price would go up again to see if more money could be taken in. In those days it was not a business but a service that was being run by the State. Being able to generate far more business and make more profit from it at a lower price is called price elasticity, but it would only work if customers responded to it. In those days customers were not - they still are not - the ones receiving mail. Nowadays I see a lot of "No junk mail" signs outside houses. We did not call it junk mail at the time, rather we called it direct marketing, although the recipients are often not so polite about it.

Maintaining services in rural areas is going to be difficult, but we must strive to do so. In addition, we should not necessarily have undue fear at the thought of private companies entering the market. As has been seen in neighbouring European countries, they often provide an even more efficient service. I welcome this debate, therefore, as one which is aiming towards achieving a better deal for customers.

It is interesting to see the changes taking place, not just in the postal service but also in every aspect of our lives. The postal service is one that has certainly changed dramatically in the last 20 years because of new technology. We must ensure we retain the ability, talent and dedication of individuals in An Post. I remember being in the post office in Ballinasloe when, after cleaning up after the day's work, it was discovered that one letter had been left behind. It would have killed the postmen to think they had not delivered it. They remembered that there was someone next door who lived close to the addressee and the letter was delivered that night. It will not be easy to maintain such dedication.

On the very first day An Post introduced the one penny stamp. In order to achieve this, we issued a load of stamps to every post office in the country. One postmaster told me that we were moving in the wrong direction. People had no idea we were going to issue stamps for one penny to mark the start of An Post, of which I was chairman. One postmaster, whom I know, ran out of stamps. However, he showed initiative by cutting two penny stamps diagonally to create a one penny stamp. I gather the few hundred stamps he cut are now highly valuable for collectors.

I could recount many more such stories from the time An Post began and it is sad to see the tradition changing. It is one that dates back to the Royal Mail's penny post in 1840. However, things change and the developments envisaged under the Bill are the right way to go. Can we take these steps, while at the same time holding onto the dedication customers enjoyed in the past, and still remain profitable?

I congratulate the Minister on the legislation, although some of it has been foisted on him by European and other international rules. However, we do not have a choice. It is the correct way to go for customers who are citizens of Ireland.