Essex post office back in business

An Essex post office bucked the closure trend and reopened as part of a three-year partnership with the county council.

It's mid-morning on a Thursday. There's a threat of rain, and the avenues of commuter land are at their most deserted. But there is a steady drift of customers into Praful Chavda's post office on the otherwise quiet parade of shops in Station Way, Buckhurst Hill, Essex. In the window there is a handwritten note that reads "Post Office Now Open", and the traditional red fascia is emblazoned with the distinctive three-swords emblem of Essex county council.

Chavda's shop closed down last February, one of nearly 2,500 post offices that fell victim to Post Office Ltd's national closure strategy aimed at stemming losses of £500,000 a day. But it was reborn in September as a result of a unique three-year deal with the council that could be a model for the rest of Britain.
The council is spending £1.5m over three years to help replace some of the 30 Essex post offices lost under the national closure scheme. Two more sub post offices reopened last month in rural Saffron Walden and it hopes 14 will have reopened by the end of this year. It wants to create a breed of hybrid establishments – in community halls, community shops or in traditional retail parades – offering post office services and a wider range of council and financial services. Tucked in the corner next to the counters in Chavda's shop stands a rack of local information and advice leaflets, and a silver computer terminal that will allow customers to pay parking fines, council tax or other local authority bills online.

It seems that the current public distaste for banking and finance is being translated into a renewed love affair with the old post office brand. Despite plans to part-privatise Royal Mail, ministers – including Lord Mandelson and the work and pensions secretary, James Purnell – say post offices could have an enhanced role administering driving licence photographs and the proposed identity card, or filling the void as banks contract. In November, they scrapped plans to privatise the post office card account used by 4.3 million claimants to receive benefits, state pensions and tax credit payments, and to withdraw cash.

Start-up loans

Leftwing backbencher Jon Cruddas suggests that the post office becomes a people's bank, offering "micro-credit" and business start-up loans. But his idea doesn't go down well with customers in Station Way.

Ed Mayo, chief executive of watchdog Consumer Focus, says the Station Way model is "exactly the kind of innovation that the Post Office network needs". But he adds that Essex county council "has had to walk through treacle" to get clearance under state aid rules and protocols for funding. Such difficulties, he says, need to end if local authorities want to innovate, and he warns that councils need to be able to commit funding up until 2011, when the government reviews its subsidy.

The Local Government Association (LGA) claims that councils keen to follow the Essex model have been frustrated by the apparent reluctance of Post Office Ltd to provide the data they need to make business decisions.

"The information they provided didn't include specific details on income, costs, and footfall for individual post offices," says an LGA spokesman. "A lot of councils are strapped for cash and couldn't really risk keeping open a post office where, in reality, Granny Miggins visited once a month."
However, a Post Office spokesman denies the charge. "We worked very closely with Essex and even seconded a member of staff to help with their plans, which are now seen as a model for other local authorities to use," he says.

Councils across Britain are offering peppercorn rents to help keep sub-postmasters in business, and are exploring ways of offering services in libraries, town halls or leisure centres. Kent county council, for example, has helped set up two volunteer-led community post office pilots near Folkestone. And to reduce the effects of the closure programme, the government itself is financing 500 "new and innovative outreach services" in partnership with pubs, village halls, churches or in mobile post offices.

Chavda, back in the post office business after a seven-month lay-off, says he is still rebuilding trade. The three-year contract will be tightly monitored by the council, but he is optimistic, given the level of local support, and he is keen to develop and extend services – even to becoming the friendly face of banking.

He says: "If they give us the right training and back-up, we can do it all. The Post Office is an asset to the country. I don't know why people have been wanting to destroy it."

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