Post Office bosses face cull to stem £2m losses
The Post Office has written to 4,000 senior managers — a third of the workforce — asking for volunteers for redundancy as part of its drive to reduce losses of GBP 2 million a week.
The cutbacks, part of a shake-up of the Post Office, come on top of 30,000 redundancies announced by Royal Mail two years ago.
Three of Royal Mail’s four subsidiaries make a profit. Royal Mail Letters made GBP 344 million last year, Parcelforce has profits of GBP 5 million a year and overseas business makes GBP 100 million a year.
But they are being dragged down by the Post Office, which had a loss of GBP 111 million last year. It has lost 30 per cent of its business in the past five years because of internet banking and changes in the way benefits are paid.
A Post Office spokesman insisted there would be no compulsory job cuts. Senior staff have been told by managing director Alan Cook that the “Organisational Design” review “isn’t just a cost-cutting exercise.”
A letter explaining the voluntary redundancy programme says: “We cannot ignore the fact that we are not making enough money to run the business. It costs us GBP 1.13 to generate every GBP 1 of income.
“So while we want to make sure that our new organisation is fit for purpose, we also need to ensure that we have a structure that has lower head office costs and where our people have the right capabilities.”
A spokesman said: “We’re committed to reducing the central management overheads — which our branches have to pay for — especially when we’re still losing GBP 2 million a week. This programme doesn’t affect people working in branches and serving customers.”
The Post Office is under heavy pressure to explain the new mailing system whereby customers will pay by the size of mail as well as weight.
Communication Workers Union official Andy Furey said: “It is appalling that the Post Office is ploughing ahead with swathes of closures in the run-up to this massive change. By systematically cutting jobs in the Post Office, franchising out the service to inexperienced retailers and downsizing the network, Royal Mail is cutting off the hand it needs to implement this huge change.”
