Cash lifeline for Guernsey sub-post offices

GUERNSEY Post’s dividend could be used to subsidise its rural retail outlets.
The utility paid £391,000 plus 20% tax to its shareholder, the States, for the year ending September 2005, according to figures released this week.
Postwatch Guernsey chairman David Inglis said that money could be used to maintain postal services that are threatened by its need to cut costs.
‘It seems strange that the States have taken about £600,000 from Guernsey Post in dividend and tax and we would like to see that come back to the taxpayer in the form of support to the retail network,’ he said.
Mr Inglis added that the UK Government subsidised its rural post offices to the tune of £150m. per year and that was a way of supporting the social need for such facilities.
But Save the Rural Post Offices campaigner Deputy Al Brouard, who organised a petition which more than 5,000 people signed, said the taxpayer would be paying for things twice with Mr Inglis’ suggestion.
‘I don’t see the need for the dividend to remain with Guernsey Post when any loss in any particular outlet has already been covered before that dividend is declared,’ he said.
‘The fact that some outlets might make a marginal loss and others a marginal profit is all part of the service of a post utility.’
Postwatch Guernsey – the non-funded consumer watchdog – has been heavily criticised in the wake of suggestions it put forward on ways of cutting Guernsey Post’s costs. They included reducing the number of retail outlets from nine to five, halving the number of postboxes and reducing the number of days for collection and delivery of mail.
‘We appreciate that there are still people who don’t have computers, can’t drive and want to post their letters,’ said Mr Inglis.
‘But our ideas were based on the presumption that if there’s no subsidisation, how can you fund these things?’
Treasury minister Lyndon Trott was unavailable for comment yesterday.
Guernsey Post has announced a pre-tax profit of £1.5m. for the year to September 2005.
Mr Inglis said that people should be pleased with the profit that had been generated, but the critical thing was what the company would do with it. The profit was a reflection on the company’s management and how everybody was working together.
Guernsey Post managing director Mike Hall said he welcomed the return to profitability.
The utility had met 18 of its 23 enhanced targets and three of the five failures had been very small.
‘However, given the predicted rise of nearly £5m. in Royal Mail charges, keeping the company in profit will be a problem,’ he said.
‘That’s why prices have to go up on 1 April but even so, Guernsey’s prices will still be some of the lowest in Europe and even with the Royal Mail increases will continue to be so.’
That was why it could see no justification for major cuts in postal services, he said.