Steve Beasant

The Daily Telegraph has reported that a quarter of remaining post offices are under threat of closure as the Government considers depriving Royal Mail of a key banking contract. The prediction has apparently been made by the Federation of Sub postmasters, and George Thomson there general secretary believes 3,000 of the 12,000 branches will be under threat if Royal Mail loses the right to operate a basic banking account.

Mr. Thomson added that the shrinking of the network would undermine its ability to successfully bid for future contracts. “Every time a post office closes it rips the guts out of a community,” he said. 

The Post Office card account was introduced five years ago when the Government stopped paying benefits over the post office counter using pension’s books, and instead had them paid into a bank account. 

“The prospect of 3,000 more branches closing in chaotic fashion is appalling,” the letter said. The Government has already shut thousands of post offices, with the cuts currently underway bringing the network down from 14,300 to fewer than 12,000. If a further 3,000 offices close, the network will be half the size it was when Labour came to power. 

    Liberal Democrat Shadow Rural Affairs, Tim Farron has called on the government to use its part-nationalisation of the banking system to help save local post offices. 

     Mr. Farron said one of the financial institutions the government has taken a stake in should help ensure the Post Office Card Account stays with the Royal Mail network. 

 Mr. Farron has tabled an Early Day Motion in the House of Commons urging the Treasury to instruct one of the newly nationalised banks to run the card account, in partnership with Post Office Ltd. 

He first raised this solution earlier this year at the time that Northern Rock was first nationalised. 

He said: “The reality is that without the customers who use the Post Office for the card account, many branches will be forced to close. 

“The financial crisis could unexpectedly have left us with an opportunity to save our vital local post offices – the government must grasp that opportunity. 

“We now have state-owned banks, it is surely within the power of the Treasury to instruct one of them to run the POCA in partnership with Post Office Ltd and give the tax payer something back for their money.”