£180m the true cost of closing 3,000 of our Post Offices

TAXPAYERS will be hit with a £180million bill for axing 3,000 urban post offices, it was revealed yesterday.

There was fury last night as it emerged Consignia – the new name for the Post Office – will not contribute a penny, even though it expects to gain more than £74m from the cost-cutting programme.

The £180m will be used to compensate subpostmasters and subpostmistresses for giving up their livelihood.

It comes from a £270m pot set up by the Government to help keep rural post offices in business.

But yesterday Liberal Democrat spokesman Vince Cable said it would be better to spend the cash to keep the post offices open, and find new ways for them to make money.

The Western Daily Press was backed by well over three million readers when it launched the Don’t Stamp Out Our Post Offices campaign three years ago.

But Mr Cable accused Government ministers of giving up on the issue since winning a second general election landslide a year ago.

“This is going to cause real hardship and financial isolation in areas that are already run down, ” he said.

“The closures will impact most on the elderly, the disabled and those in poverty, and the needs of vulnerable groups are not being addressed in the decision-making process at all.”

A leaked Consignia document said the cash could keep post offices open for another 10 years.

The branches most at risk are those where a high proportion of income comes from paying out pensions and benefits.

This is because the Government is to switch to paying the money directly into claimants’ bank accounts. In Bristol South, the constituency of Paymaster General Dawn Primarolo, 17 out of the 24 post offices rely on benefits for at least 40 per cent of their work, while in the Prime Minister’s Sedgefield seat it is 23 out of 32.

The Government is setting up a Universal Bank which is intended to give post offices a slice of the money, but there are concerns over whether it will be in place by the deadline of April next year.

A spokesman for the Department of Trade and Industry confirmed the £180m would come from the taxpayer.

“There is over-provision in the urban network and an opportunity to transform the service being offered, because while there will be fewer outlets they will provide better services, ” he said.

A Department of Work and Pensions spokeswoman said the Government was still in talks with Consignia about the plans for a Universal Bank.