Local Post Offices face "uncertain future"

12.00.00am GMT Mon 30th Jan 2006

Local Post Offices face an uncertain future with the news of the loss of key government contracts with the Post Office network which could see local post offices closing in Gwent, claims a senior Assembly Member.

The Department for Work and Pensions has decided not to extend a £1bn contract for the Post Office Account Card, which is used by 4 million people to draw their pensions and benefits, when it expires in 2010. Further news will also see a change in whereby the government plans to process passport applications by opening high street shops to vet applications, taking away the £12 million passport business from post offices.

Commenting on the news, local Area Assembly member, Michael German said, "This really is a big blow for the Post Office. This announcement is likely to threaten urban Post Offices particularly as rural ones are receiving government support. We could be seeing a rash of closures around 2010 similar to a couple of years ago.

"Ninety-seven per cent of Britain's post offices are sub post offices run by private business people. Faced with losing government pension and benefit business as well as passport applications many sub-post masters will question whether the job is still viable.

"It is becoming abundantly clear that the UK Labour government wants to restrict people's choice and rapidly end all business with the post office. I can see urban post offices being hit so hard, that the many small private businesses that run our post office network will just shut up shop."

The UK government's decision to end business contracts with the post office is in direct contrast to just five years ago when the Prime Minister wrote in the Post Office's annual report: "Especially in rural areas, and in disadvantaged parts of our towns and cities, post offices play an important role in communities across the country: keeping services going, supporting the vulnerable, acting as a focal point. The government values the Post Office network. We want to see it thrive."

Mr. German added, "The 14,000 strong post office network faces losing a key contract. The direct loss of this revenue will be further compounded by the fact that there is bound to be a drop in sales in other goods on display in the post office. This will particularly hit the sub-post offices who have the most to lose."