Threat to 6,000 Post Office jobs

THOUSANDS of loss-making rural post offices will start to close next year because the Government has failed to give a long-term pledge on their future, Financial Mail has learnt.

Postwatch, the Post Office's watchdog, said that over the next five years 6,000 of the 9,000 loss-making branches could be shut down with the loss of 10,000 jobs - more than the entire MG Rover workforce.

Gregor McGregor, chief executive of Postwatch, told Financial Mail that the absence of a promise of future subsidy or a coherent plan for rural post offices was a 'gaping hole' in Labour's General Election manifesto.

'We were amazed there was no commitment given on the rural post offices,' he said. 'They are at the heart of the community and we would have thought there would have been something in the manifesto on their policy about this.'

The Government has pledged an annual subsidy of £150m to keep rural post offices alive - but only until 2008. The money is paid to the Post Office, which loses £3m a week subsidising the rural network.

But McGregor said that it was unlikely that owners of rural post offices would remain in business until 2008.

'We are losing about 150 a year,' he said. 'This is a trickle, but it will turn into a flood next year --thousands are at risk.'

Last night, Colin Baker, general secretary of the Federation of Sub-Postmasters, which represents 17,000 staff working in small post offices, said: ' It is very, very worrying indeed. If there is no further support after the end of 2007, we face serious closures.

'The present subsidy only just helps an ailing rural network to survive. If it is stopped, we will pay a terrible price.'

A Labour Party spokesman said: 'We have made no commitment for the future of the post offices after 2008, but we are keeping the matter under review.'

For the past year Postwatch, which is funded by the Department of Trade and Industry, has been pleading with the Government to produce a plan to solve the crisis in the rural network.

It now claims to have been let down by the failure to include a commitment in Labour's manifesto, which does, however, say the Government has no intention to privatise the Post Office.

The Government is expected to launch a redundancy programme similar to the one that has helped to cushion the blow for 2,600 urban post offices that have closed over the past few years.

Urban post office owners were able to get redundancy payments of up to £70,000 and the closure plan was monitored by Postwatch to ensure that closures were not overly concentrated in one area.

A similar plan for the rural post offices could cost the Government about £350m. But Postwatch argues this money, combined with a plan to reinvigorate rural post offices by giving them different functions such as making simple documentation checks on behalf of the police, could ensure the network was retained.

McGregor said: 'We recognise there is not a business case for the present set-up. Some rural post offices get only 30 or 40 customers in a week, but it is possible to have an orderly decline.

'We were hoping that the Labour Party manifesto would give some clue for the future. But there is nothing there.'

A Royal Mail spokesman said it was working with the Government on initiatives to save the network. 'We hope by the winter we will be able to announce the result of trials into new ways of extending the life of rural post offices,' he said.

THE Royal Mail is to launch a huge apprenticeship scheme next year. It will spend up to £10 million so that 1,000 teenagers between 16 and 18 can win a qualification in 'mail services'.

The 18-month course will cover delivering and sorting mail as well as management. The scheme was the brainchild of chairman Allan Leighton, who has been working with Education Secretary Ruth Kelly on setting up the scheme.

Leighton said: 'This is a fantastic scheme and a terrific opportunity for young people in Royal Mail.'