£370m will deliver secure future for rural post offices

THE future of rural post offices will be safeguarded with a £160million Government fund to protect village branches from closure, ministers will announce today.

Another £210million will be spent modernising the 11,600 branches over the next three years, as Greg Clark, the Business Secretary, claims the network is “at its most stable in decades”.

The Post Office will also announce today that it has moved into profit for the first time in 16 years, making £13million in the last financial year.

It means post offices will be less reliant on Government subsidies to stay open, currently at £250million a year.

The £370million three-year Government funding package, which will run from next April, is designed in part to secure the future of 3,000 “last shop in the village” post offices.

The Government says the network has grown for the second year running, with the number of rural branches now standing at 6,185, though the Post Office network is still 50 per cent smaller than it was 30 years ago.

Earlier this year, the Post Office announced plans to close and franchise 37 Crown offices, the directly-managed branches that are among the largest in the country, and replace them with franchised stores, in keeping with more than 97 per cent of branches. Dozens of branches have moved into branches of W H Smith and other stores in recent years, though the Post Office claims 99.7 per cent of people live within three miles of their nearest branch and 93 per cent within a mile.

Paula Vennells, chief executive of the Post Office, said the changes had enabled the network to “stay relevant” to communities that depend on it for vital services such as banking.

She said extended opening hours had added almost a million extra opening hours every month, with 4,400 branches now open on Sunday, making the Post Office numerically the biggest Sunday retailer in the country.

Mr Clark said: “With the network at its most stable in decades, this £370 million of Government funding will ensure it can continue to modernise and bring further benefits to customers.”

However, the Communication Workers Union, which represents postmasters, said: “While the Post Office and the Government are dressing this up as good news, in reality the Post Office is facing a significant cut in funding for the next three years.

“Its financial results have been delivered on the back of closures, thousands of job losses and huge reductions in income for sub-postmasters. Far from modernising the network, this is managing its decline.”