Norway Post to shut down almost all post offices

Norway Post was given the green light by lawmakers yesterday to make standalone post offices virtually extinct. The Post said government proposals to convert a final 149 post offices into postal counters offered within partner-run retail stores has now been approved by Norway’s Parliament.

The move will see around 1,400 in-store postal counters provided across the country, but will leave only about 30 post offices remaining.

Norway Post said the process should take place in 2013 and 2014, and will likely affect around 1,000 post office staff.

Over the past 10 years, Norway Post has transferred 700 post offices to in-store counters, responding to a trend for fewer people visiting post offices driven particularly by the rise of online banking.

Demand for banking services provided within post offices has fallen 90% over the past two decades, Norway Post said.

Among the legislative changes, the Post has had its obligation to provide financial services relaxed to cover only rural areas, but details will have to be worked out with the bank DNB.

The move to in-store facilities also allows customers to access postal services outside ordinary working hours.

Dag Mejdell, the Norway Post CEO, said: “Norway Post must adapt to changes in customer demand. In-store postal counters provide a service that is well adapted to customers’ requirements for longer hours.”

Employees

The Norway Post CEO said had agreements in place with unions that would protect employees’ interests.

“It is a challenge that many of our talented and loyal employees will be affected,” said Mejdell. “We have good cooperation with the unions and good experiences from previous restructuring processes. I am seeking predictable processes, and we’re creating the best possible solutions for the individual.”

Postal union Postkom said today that it was in discussions with the Post, which insisted that there should be enough time and arrangements put in place to avoid forced redundancies.

Early retirements will be offered, along with severance packages worth up to NOK 30,000 (just under $5,000 USD) each.

Meetings with staff were held this morning, with a list of post office closures released. The union said affected staff were also provided with information on resources available to help with the human impact of the restructuring.

“It has been a difficult start to the day for all those affected,” said union leader Odd Christian Øverland.

Among measures being designed to help staff is a pledge to find jobs elsewhere in the organisation where possible, while an internship programme is to be launched in the autumn of 2012 to help affected employees boost their experience in different areas of the company while they seek jobs elsewhere.

Privatisation prospects

Postkom said that during yesterday’s debate in the Norwegian Parliament, politicians from the opposition Progress Party and Conservative Party groups revealed their desires to privatise Norway Post.

The opposition parties also favour adopting Europe’s Postal Directive, fully liberalising the postal market (Norway is not part of the European Union, but is closely aligned), and the abandonment of Saturday delivery.

Norway is currently ruled by a coalition of the country’s centre-left Labour Party, the Socialist Left Party and the Centre Party, with a majority of lawmakers opposing the proposals of the centre-right groups according to Postkom.

It leaves Norway Post state-owned, with a monopoly on letters weighing under 50 grams.

But national elections are now only a year away, with the union warning that a battle over postal services could begin if the centre-left groups come to power, such as through a coalition with the Christian Democrats and Liberals.

“It is discouraging to see that the Conservatives and the Progress Party, with its radical suggestion, is willing to put the postal services and jobs at risk by handing over our nationwide network of good and efficient postal services to market forces,” said Øverland.