Inside Parliament: Lilley beats retreat over threat to post offices: Labour accused of scaremongering - Minister details costs of payments - Bill to protect abortion clinic staff - Heseltine's Russian conundrum

Lilley took his turn in the Commons yesterday as the latest Secretary of State to beat a tactical retreat, offering reassurances for people who want to collect their pensions at the Post Office and for sub-postmasters who fear for their livelihoods.

Though the Secretary of State for Social Security accused the Labour Party of 'shameless scaremongering', he promised that a new pension claim form planned for the summer would 'of course mention the Post Office' and that the nation-wide network of post offices was safe. The three variants of the form sent out in a trial by the Benefits Agency in March were heavily weighted in favour of automated credit transfer (ACT) through bank or building society accounts.

Donald Dewar, Labour's social security spokesman, said: 'Mr Lilley planned a little job by stealth. He has been found out, and he ought to pay the price.' One of the pilot forms did not even mention the Post Office, Mr Dewar said. 'What happened was a deliberate attempt to restrict choice by withholding information.'

Rebutting the charge of 'scaremongering', Mr Dewar twice quoted the words of Michael Clark, Conservative MP for Rochford, who told the Commons last Thursday that the forms were 'designed to discover how effectively the wool can be pulled over the eyes of those who receive pensions and benefits'.

Underlining the threat to sub-post offices, Mr Dewar said: 'I don't pretend that every one of them is a place of romance and mystery that would find its place conveniently in a Hovis advertisement. But I do know they are valued and seen as an integral and important part of the community.' Efficiency should mean a 'demolition job' on post offices in rural areas and on big housing estates.

Barracked and frequently interrupted by Tory loyalists, Mr Dewar observed that there was 'a kind of flying picket' for the debate. Mr Lilley was less gracious, railing against 'the mob on the other side' when his reassurances were doubted.

Explaining the advantages of ACT, Mr Lilley said it had not escaped the notice of the Treasury review team that the biggest single item on DSS operating costs was the pounds 650m cost of delivering benefits. Of that, pounds 100m was order books and girocheques stolen and fraudulently encashed. 'Moreover, the cost of paying out by order books is 14 times as great as the cost of payment by ACT. Each payment by order book costs 44p. The same payment into a bank account costs just 3p.'

Mr Lilley said no minister could guarantee that every single post office would remain in operation. But a viable network would be maintained through the contract between the Benefits Agency and Post Office Counters, which, it so happened, was currently being renegotiated.

'It is perhaps no coincidence that that blood curdling warnings about the collapse of the branch network are circulating at this time,' Mr Lilley said. This smear on Post Office Counters was topped by more direct criticism of the Sub-Post Masters' Federation for its 'misleading' leaflet for claimants.

Pressed by Geoffrey Dickens, Conservative MP for Littleborough and Saddleworth, he said 2,700 small sub- post offices were paid a fixed sum regardless of the volume of business transacted. 'So changes in people switching to ACT would make no difference in the amount of remuneration they receive.'

Whether or not Mr Lilley had done enough to persuade critics that cash payments to pensioners over the counter in village post offices were assured, there was no Tory backbench enthusiasm for a Labour motion coupling the threat to sub-post offices with economic mismanagement. It was rejected by 311 votes to 275.

A second Labour motion, condemning the Government's 'callous and cavalier' treatment of Swan Hunter, the Tyneside yard which went into receivership after failing to win a vital order naval order, was defeated by 304 votes to 263.

MPs gave a first reading to a Bill from Harry Cohen, Labour MP for Leyton, aimed at protecting the staff and patients of abortion clinics from attacks by militant groups such as Rescue America, which has threatened to return to Britain in September. It would be an offence to harass or obstruct people entering clinics.

Anti-abortion groups in America had stormed hospital theatres and a Florida doctor had been shot dead, he said. They are trying to export this intimidation and violence now to the United Kingdom.' Nor was it just American groups. 'We have our own home-grown intimidators and women-bashers.'

There is no prospect of the Bill becoming law. Even if parliamentary time was available, it would face fierce opposition from the all-party pro-life MPs.

Another minister still trying to remove traces of egg from his face, Michael Heseltine, appeared before the Commons at question time and slipped on one from Michael Fabricant, Conservative MP for Mid Staffordshire, about bi-lateral trade with Russia.

The President of the Board of Trade began safely enough, reading from his file that he had established contact with Deputy Prime Minister Shokhin at the first meeting of the British-Russian Steering Committee on Trade and Investment in Moscow last September, met him at a second meeting yesterday morning and planned to continue talks today.

Mr Fabricant said business with Russia was well worth pursuing in the long-term due to its huge resources of coal and oil. 'And regarding the short term, his meeting this morning with Alexander Nikolayevich Shokhin, what does he think will be the benefits of this?'

Best known hitherto as a target for jibes about wigs because of his unusual hair style, Mr Fabricant's facility with Russian names convulsed MPs and totally threw Mr Heseltine. 'Madame Speaker, I must crave the indulgence of the House, I was so carried away with the full explanation of where I had been today that I missed the important part of the question.'

With the rarely-granted permission of the Speaker, Betty Boothroyd, Mr Fabricant repeated his question, drawing out 'Alexander Nikolayevich'. After a considerable pause, the President said Mr Fabricant was 'very right to ask this question,' and then after another pause, 'I think the conclusion that I draw is that we have much to gain both in the long and the short term.'