UK Postal Services Bill: Post Office mutual plan unveiled

Post Office Ltd could be turned into a mutual body – giving power to staff, subpostmasters and communities, the UK government has revealed. The proposal forms a part of the Postal Services Bill, published by business secretary Vince Cable today (Wednesday).

The government – who owns 100% of Post Office Ltd – stressed that the company will become separate business, and will not be sold. There are also no further planned branch closures.

However, Cable confirmed that the organisation could adopt a structural setup similar to that of John Lewis or Co-operative Group.

He said: “I’m concerned that the current structure of the company is holding the network back. The interests of the central holding company and locally owned branches are not always aligned. So, for example, subpostmasters are pitted against Post Office Ltd when they negotiate annual pay rates. And they fear Post Office Ltd expanding online because they worry it will drive customers away from their stores and that they won’t share in the profits.

“I want to start a conversation about how it is run in the future, but it seems to me that the Post Office is ideally suited to a John Lewis or Co-operative Group style structure – where employees, sub postmasters and communities get a greater say in how the company is run. This would be the Big Society in action.

“We’re already seeing how well the mutual model can work at a local level – across the country there are a growing number of examples of community groups, charities and local people coming together to provide Post Office services in their area.

“A change at a national level would empower those that know the Post Office best and give them more of a stake in its future. It could deliver the common sense of purpose needed to provide a vibrant future for the network.”

Co-operatives UK has been asked to explore options for creating a mutualised Post Office, reporting back to government ministers next spring. Before any move to a mutual structure there would also be a full public consultation.

Peter Hunt, the chief executive of Mutuo, said: “This proposal could help to secure the future of the Post Office for the public benefit.

“As a mutual, the Post Office will be able to harness the experience and goodwill of its employees, business partners and its customers.

“Together they will be part of a practical partnership that uses all of their skills to design a Post Office for the years ahead.”

The announcement was made as the government put plans forward to privatise up to 90% of Royal Mail.

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