JOINED UP GOVERNMENT
93. The NFSP and CWU were concerned that the DWP
had been acting in isolation from other Government Departments
on the issue of the POCA and was "failing to recognise the
much wider social and economic implications of withdrawing the
POCA without a Post Office based alternative in place".
94. While ending the POCAs would represent a short-term
saving to the DWP, the CWU was concerned that these decisions
had been made without having joined-up government thinking in
terms of the DTI and the wider social and economic costs that
such a move would trigger: "We have a major concern here
that one decision by one government body is actually impacting
detrimentally on another government body, so the bottom line is
that we have not been consulted on this".
95. The NFSP also told us: "the Government have
got to start to think of its departments (a) in a joined-up manner
and (b) to some degree think Post Office first. It is an absolute
no-brainer as you have already said: they are paying out money
with one hand to keep the network going and taking the means of
earning a living away with the otherthe DVLA et cetera".
96. We suggested to the Minister that there should
be a more joined-up Government policy for the future of the Post
Office network. He said: "we have to look at this as government
across departments, identifying the need of each department and
the role that it will play in being able to potentially assist
the network and being able to survive, whether that is financially
or with resources or with tasks or with contracts".
He also explained that a Cabinet sub-committee, Miscellaneous
33, had been set up and will be formally bringing Government departments
together to examine the issue of the Post Office network.
We asked when this committee would be reporting its findings.
The Minister replied: "we have not got a date for formal
but that "given that the SNP [Social Network Payment] runs
out in 2008 we clearly have a backstop. We do have the pilot evidence,
which was only completed in March of this year, which is being
examined, and we do have the commitment to a further consultation
period because we are not going to make an announcement and say
that is the conclusion, we are going to allow people the opportunity
to express a view".
97. Historically the UK has enjoyed the benefits
of a comprehensive network of sub-Post Offices, often in very
remote, rural locations, because of the wide range of services
the Government chose to deliver through those Post Offices. On
top of unavoidable technological and social change, which have
reduced client footfall, the Government is now withdrawing services
from the Post Offices. If the country wants a comprehensive network
of Post Offices to continue, a more explicit funding mechanism
must be put in place, together with product diversification and
a replacement for the Post Office Card Account.
98. There has been a lack of joined-up thinking
between Government departments, perhaps to be addressed, at last,
by the Cabinet sub-committee. The DWP is undermining the Post
Office network by removing the Post Office Card Account, although
the Government now appears to be considering the need for a substitute.
The end of the Post Office Card Account has been the most serious
but not the only cause of the present difficulties, as decisions
by the BBC and the DVLA (with respect to licensing) have also
removed income from Post Offices. Given that the DTI then have
to put money in to keep the network going, taxpayers' money is
going round in a circle, while there is a climate of uncertainty
for sub-postmasters. This makes no sense to us.
99. We are seriously concerned about the apparent
lack of urgency in the remit given to the Cabinet sub-committee
examining the future of the Post Office network. Sub-Post Offices
have already lost sources of income, and postmasters will be making
decisions now on whether they can sustain their business. There
is a danger of seeing considerable closures before the Social
Network Payment ends, unless postmasters are given a much better
indication of future sources of income after 2008.
100. There appears to be widespread, if reluctant,
acceptance among our witnesses that a network of 14,500 branches
is unsustainable. Postcomm has said that a network of 4,000 Post
Offices could breach the universal service obligation. We expect
the Government to work with Royal Mail Group and the regulator
to determine the size and shape of a network that would meet the
universal service obligation. Once this is done, if some individual
Post Offices which are judged to provide a valuable social service
are still incapable of making a profit, then the Government should
be prepared to continue a subsidy to parts of the network post
2008. It should make this commitment as a matter of urgency.