UK Post Office in talks with Spar & others on offering mail services
The Post Office is in talks with convenience store chains about installing facilities that will allow the full range of mail services to be available outside normal working hours, said executive director Alan Barrie.
Speaking last night, before MPs voted to back a 210 mln stg rescue package aimed at stemming growing losses in the Post Office network, Barrie said he had spoken to companies such as Spar-Handels AG about hosting Post Office services.
He said the government cash will pave the way for the closure of up to 30 pct of the 9,000 post offices in towns and cities across the UK. The closures are designed to help parent company Consignia – which is currently losing 1.2 mln stg a day – cut its debts.
The investment has been cleared under EU state aid rules but still needs parliamentary approval.
The move is designed to turn around losses of 163 mln stg last year “that would accelerate without intervention”, Barrie said.
Barrie cited the example of a Londis convenience store as “a model for what we see in the future” with a Post Office counter at the rear but also with two tills at the front which would provide out-of-hours services seven days a week.
“That’s magic for me, that you can actually say that your are now going to find Post Office hours adopting the host business hours which increasingly are important for people who use Post Office services,” he said.
“We are in discussions with a number of chains…and I have have personally been in discussion at board level with many of these companies for some time.”
He said he had spoken with “both the main private networks and the symbol groups (such as) Spar and Londis”.
Barrie said that some of the 97 pct of post offices run by individuals are “teetering on the edge of viability”.
“If we didn’t intervene they would go bust and we’d lose service to certain communities in urban environments,” he said.
After the changes are made the company will ensure that more than 95 pct of the UK urban population live within a mile of a post office and “the majority of those with half a mile”, he added.
“We will not close Post Offices without local consultation.”
Sub-postmasters who wish to close their branches or have them shut down under the government plan will be entitled to claim compensation from a 180 mln stg fund, Barrie said.
The remaining 30 mln stg will be used for further investment. Sub-postmasters will be able to apply for grants of up to 10,000 stg which they will be expected to match.
The network is also hoping to bring in extra business by linking up with major banks to provide encashment services.
“By next April we have all 17,000 post offices online with all main banks and building societies in the UK,” Barrie said.
“That allows us to enter into banking and allows us to be in the field to win back some of the business that we would otherwise have lost by the announcements that benefits payments are to go through banking service.
“That’s 40 pct of our income and any business with a threat to 40 pct of its income needs to make a pretty powerful response.”
The Post Office will lose 400 mln stg a year when the government starts to pay benefits into bank accounts and moves away from the over-the-counter paper-based system.
The changes will start next year and will take two years to complete, Barrie said.
A new swipe card will be introduced at this time which will be linked to a Post Office current account, allowing people who don’t have bank accounts to take cash from benefits and pension entitlements.
Barrie said Post Office customers will also be able to pay for services via debit cards from next April in line with some overseas operations.
He ruled out the use of credit cards as “we work on low margins and credit card charges are punitive”.
The parliamentary debate comes a day after a ballot began of 3,000 postal workers, on strike action over plans to privatise their jobs.
