Radical plan to save rural post offices
A radical scheme to transform rural post offices into government information `one-stop-shops’ which also provide banking services is among the proposals under scrutiny by the government.
Anxiety is mounting over the future of 1,900 sub-post offices, following predictions from An Post that its post office division would show a £13 million loss this year. Group chief executive John Hynes last week described the losses as “unsustainable”.
An interdepartmental group appointed by the Minister for Public Enterprise, Mary O’Rourke, will report back next month on a range of proposals for the post office division, following a consultant’s report by Phil Flynn. The report concluded that the only option to secure the future of post offices was for the state to pay a subvention to An Post.
One proposal is for sub-post offices to become one-stop-shops which would provide rural areas with internet access and information services now provided by local authorities, government departments and state agencies. Such an option is likely to include an investment from the state.
The transfer of banking services from AIB and Bank of Ireland local branches to post offices is also under scrutiny. The banks would pay An Post between £15 and £20 million as part of the `universal banking’ model. This would ensure
the viability of rural post-offices through the transition period, which could take up to three years.
The proposal would significantly extend the government’s plans to transfer bill-paying services from banks to post offices. It is understood that the `universal banking’ proposals have already been discussed by the minister’s department and the banks.
O’Rourke is believed to be opposed to the widescale closure of rural post offices, and believes that the banks — which have made substantial profits in rural areas over the years — have a social duty to continue providing services.
There is also concern in political circles about the possible emergence of independent candidates in the run-up to a general election, running on a platform opposed to post office closures.
Hynes last week warned that annual losses in the post offices division would rise from £13 million this year to £28 million in 2004, unless An Post received a state subvention.
An Post reported overall profits of £35 million in its annual report for 2000, with turnover up 6.4 per cent to £451 million. The biggest contribution to the overall profit was the £40.5 million realised from the sale of its shareholding in Esat Telecom to British Telecommunications.
An Post’s letters division showed a 9 per cent volume growth, with revenue up £17.4 million to £288 million.
Sunday Business Post
