UK Government's plans for Post Office prompt flood of critic

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UK Government’s plans for Post Office prompt flood of criticism

UNIONS AND PENSIONERS HIT OUT AT BID TO INVEST IN BRANCHES AND CUT QUEUES, BUT NOT SET UP BANK
BY DAVID PERRY

The UK Government has unveiled plans to invest in post offices, cut queues and increase opening times – but will not set up a state-backed Post Office Bank.

The decision angered unions, business and pensioner groups.

And a promise that there would be no more branch closures was greeted with derision last night.

The pledge was made by Post Office managing director Paula Vennells at a Commons business committee hearing on legislation authorising the part-privatisation proposal for Royal Mail and a form of mutual ownership for the Post Office itself.

Postal Affairs Minister Ed Davey announced that, instead of the new bank, the Post Office, Royal Bank of Scotland and NatWest had joined other banks giving customers access to their current and business accounts through the Post Office.

Mr Davey claimed the network was “on the cusp of an exciting new era”.

But Ms Vennells’s pledge was labelled “a hollow promise” by committee member and Ochil Labour MP Gordon Banks.

He said there was no way the Post Office could stop local postmasters fed up with losing money from shutting up shop and retiring.

Mr Banks challenged her on what provisions in the legislation would require the Post Office to reopen a branch at Bankfoot, Perthshire.

Angus SNP MP Mike Weir, another committee member, said Ms Vennells’s promise was “ludicrous”.

He added: “She is living in cloud cuckoo land.”

Mr Weir said her plan to concentrate on 4,000 money-making “main post offices” would be to the detriment of the remaining small rural and urban sub-post offices.

And he said the decision not to create a Post Office Bank was “regrettable” and “shortsighted” and did nothing for people denied bank accounts and facing “financial exclusion”.

Aberdeen North Labour MP Frank Doran said the “no more closures” pledge was “an empty commitment” because after the government lost control of the Post Office it could not be enforced.

Mr Doran added: “What the government is doing is fattening up Royal Mail and the Post Office for sale.” But Gordon Liberal Democrat MP Malcolm Bruce said the promise meant there would be no closure programme because individual offices might close for a variety of reasons, including natural wastage.

He said what was needed was more government business to ensure offices had enough work to be viable.

The Department for Business said now was “not the right time” to develop a new, state-backed bank, adding that set-up costs would make it “extremely expensive”.

Mr Davey said: “Our long-term goal is to convert the Post Office into a mutual structure, for example like the Co-operative Group, giving employees, sub-postmasters and communities a much greater say in how the company is run.”

Billy Hayes, general secretary of the Communication Workers Union, warned that separating Royal Mail from the Post Office would kill off local branches.

The National Pensioners Convention, which is part of a coalition pressing for a Post Office Bank, said: “This is an extremely short-sighted decision which will put the future of the Post Office network in jeopardy.”



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