Council bids to run post offices

**4me2** · 8th March 2008

Critics say post office closures could devastate communities

Essex County Council has become the first local authority in the country to discuss taking over the running of post offices earmarked for closure.
The council is negotiating a buy-out price from the Post Office and said some 15 branches could be saved within two months.
The closures in Essex were among 2,500 nationwide announced in 2006 in a bid to stem network losses of �4m a week.
Postal affairs minister Pat McFadden has given approval to the scheme.
And the Post Office said it was willing to work with other local authorities on similar takeovers.
Subsidy
The Post Office gets a �200m government subsidy to offset some of its losses.

HAVE YOUR SAY

In principle it seems the right thing to do but since Council's are hardly renowned for financial competence, I expect it will quickly be used as an excuse for raising Council Taxes

Steve, Cambridge

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Essex County Council moved to allay fears that council tax payers could end up subsidising what has been a huge loss-making business.
It said it believed it could make a profit by combining postal services with council services.
Councillor Stephen Castle said some 15 other local authorities had expressed an interest in its project.
"We have had interest from right across the country - people are clearly very worried about the future of their post offices."

Other councils will be watching what happens with Essex to see if this is the way forward

Edward Welsh,
Local Government Association

Council leader Lord Hanningfield said he was "delighted" that the council might be able to save some post offices under its "unique and groundbreaking" deal.
He said: "There is a huge amount of work still to do and we will now be conducting our own assessment on the merits and financial viability of each post office, together with the needs of the communities that they serve.
"Because of this, it is too early to mention specific branches at this stage."
He added the scheme was "not about replacing one public subsidy with another".
The aim was for any investment to be used over three years to help each branch to move towards becoming financially self-sufficient and "cost neutral" to the council, he said.
Rising losses
Mr Castle told BBC News the council hoped to be able to reopen 15 or 16 of the 31 post offices which had recently closed in the county, using the same staff where possible.
It said it would be announcing which branches these would be in the next few weeks.
In the longer term, he said it was hoped new models would be found to enable post offices to become self-sufficient. This could be by combining them with other services such as schools or libraries, he suggested.

It should be a service that is geared to customer needs rather than to traditional ways of doing things and traditional opening hours

Andy Burrows
Postwatch

He said: "The problem is the government and the Post Office haven't, I don't think, taken time to actually think outside the box and think of a different way of doing it."
The scheme has the backing of the Local Government Association, which represents local authorities in England and Wales.
It denied it would be a waste of taxpayers' money but stressed the subsidy the Post Office gets from the government should go to councils to help them run "these essential services".
Edward Welsh, of the LGA, said: "Other councils will be watching what happens with Essex to see if this is the way forward."
Andy Burrows, of industry watchdog Postwatch, said a changing commercial environment had made it hard for post offices to fulfil their important social function, as they had less government business to carry out and found it harder to attract customers.
He told BBC News he hoped any local authorities which took over post offices would be able to apply "true innovation", allowing customers to access services at the times they wanted.
He said: "It should be a service that is geared to customer needs rather than to traditional ways of doing things and traditional opening hours."
He added that it was important post offices had the right range of products and services for their customers and that they were attractive places to go to.
The government announced at the end of 2006 that 2,500 of the country's 14,000 post offices were likely to close by the end of this year because of rising losses largely caused by fewer people using the network.
Critics say the closures will have a devastating effect on communities, particularly rural ones.
Mr McFadden supported Essex's move but said it was up to councils to come to their own deal with the Post Office.
"If they are serious about it and are willing to put money in and they want to be answerable to their local council tax payers for that decision, then I would encourage Post Office Ltd to talk to them about that seriously."

http://news.bbc.co.uk/1/hi/uk/7284758.stm