Rural post offices deal extended

Ministers have extended an agreement to minimise the closure of rural post offices until the autumn while the future of the loss-making network is discussed.

The “no avoidable closures” deal between the government and Royal Mail to find a replacement when a local subpostmaster or mistress resigned, due to end this month, would be extended to the autumn, said Barry Gardiner, minister for competitiveness.

Last month, the European Commission gave state aid clearance for the Pounds 150m annual subsidy for rural post offices to continue until 2008. But the network’s long-term future is uncertain, partly becauseof the loss of government business such as benefits payments that used to provide the bulk of post offices’ work. Adam Crozier, Royal Mail’s chief executive, said yesterday it was “crucial there is a full debate on the future of the rural post office network”.

Royal Mail also published the results of trials of alternative ways of offering post office services in rural communities. These suggested alternative approaches reduced costs but were still loss-making.

Jean Eaglesham