Post Office 'mutual ownership' gets thumbs-up from Co-operat

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Post Office 'mutual ownership' gets thumbs-up from Co-operatives UK

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The Manchester-based head of Co-operatives UK has welcomed government plans to move the Post Office into mutual ownership.

Sub postmasters, customers and communities could be given a say in how the Post Office arm of the network is run, including the appointment of directors.
Ministers said the Post Office could be on a "clear path" to mutualisation by the end of this parliament as it launched a consultation of its proposals.


The move follows the controversial announcement to privatise the Royal Mail side of the postal business, which the Government argues is necessary to protect its future and ensure growth.

The consultation follows a report earlier this year led by Co-operatives UK which suggested that a mutual body, such as a company or a co-operative, could be set up, with members including staff and customers.

The Government would then transfer ownership of the Post Office to that body, which would have a say in board appointments as well as sharing in profits.

Ed Mayo, secretary general of Co-operatives UK, which works to promote and develop co-operative enterprises, said: "We encourage debate on the proposals from key partners involved and this consultation is a landmark for the potential introduction of a significant new mutual in the UK economy.

"Those who work in post offices and who deliver its services would be central to the running of the Post Office Mutual and need to be central to its formation.

"The mutual and co-operative form is about member-ownership and is adaptable to a variety of circumstances - from FC Barcelona in football to The Co-operative Group in retail.

"In the UK there are 5,450 co-operatives, with around 12.8 million members and the co-operative sector has outperformed the economy as a whole since the credit crunch. It is a form that could be of great benefit to Post Office Ltd."

Postal Affairs Minister Edward Davey said: "The Post Office sits at the heart of our communities and I am determined to make sure that it becomes a successful and profitable business.

"With this in mind we want to explore how those with an interest in the Post Office could be given a real say in how it is run.

"The consultation, Building A Mutual Post Office sets out the different options for how we might enable sub postmasters, employees, post office customers and local communities, to have a real stake in the future of the Post Office.

"Combined with our major investment programme and Post Office's ambition to become the 'Front Office for government', a mutualised Post Office could help link a new commercial focus with an even stronger community purpose.

"That's why I really want everyone with an opinion on the future of the Post Office network to tell us what they think of our proposals."

The Government said it believed that Post Office Ltd could be ideally suited to a mutual model, with those that know it best working together, giving them a greater say in how the business is run, as well as a stake in its success.

Changing Post Office Ltd - the national company which sets the strategy for the post office network and operates some of the larger branches - to a mutual would not affect the ownership of the thousands of privately-owned post office branches across the UK, said ministers.

Mr Davey said the coalition was investing £1.34 billion into Post Offices to improve efficiency and levels of service, but mutualisation would help secure its future, he said.

The consultation will continue until mid-December, but it could take years before mutualisation is completed.

The government's plans to privatise the Royal Mail were waiting for regulatory changes and European clearance on state aid, but Mr Davey said there had been a "dramatic change of atmosphere" now that the Postal Services legislation had been approved by Parliament.

Billy Hayes, general secretary of the Communication Workers union, warned mutualisation could still lead to post office closures.

“The Post Office needs to be sustainable before it can be mutualised and that requires real business solutions and guaranteed funding. The sad fact is that dozens of post offices have closed under this Government because contracts and services have been taken away by government, undermining revenues and leaving an uncertain future,” he said.