Post Office gets set for shake up

THE Government is to appoint a separate chairman to Post Office Ltd, which could pave the way for the demerger of the nationwide post office counters business from the Royal Mail and Parcelforce. Consignia, the Post Office’s parent company, is expected to announce within the next few weeks that the counters operation, which includes the network of 17,500 sub-post offices, made a loss last year of more than pounds 100m. Allan Leighton, Consignia’s chairman, is thought to have warned ministers that the group can no longer fund losses in the counters business. These will escalate from next April when the Government starts to pay benefits directly into bank accounts, a move that will cost sub-post offices pounds 400m in lost revenue. Consignia owns only 600 of the 17,500 sub-post offices but it does business through the rest, manages the network and subsidises many of the outlets. Leighton has embarked on a three-year rescue plan for Consignia, which is losing pounds 1.2m a day. But the plan focuses on the Royal Mail and the ailing Parcelforce. There are already proposals to close some 3,000 sub post offices in urban areas.