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Report predicts loss of 557 Post Offices if welfare payment contract lost

Saturday, 22nd February, 2014 10:30am

Report predicts loss of 557 Post Offices if welfare payment contract lost

A report commissioned by the Irish Postmasters’ Union from Grant Thornton has found that if the social welfare contract is lost to An Post some 557 Post Offices nationwide would close down. ? ?
The report, launched at a briefing for Oireachtas members and the media in Dublin this week, found that by 2017 there would be a decline of 557 Post Offices (48%) in the network, which has 1,150 Post Offices at present. Urban and rural communities would be hit by the closures that would follow the loss of the social welfare contract.  ? ?
In another scenario, if direct electronic payments are introduced and 75% of payments occur via EFT without the involvement of the network and the remainder delivered via over the counter transactions by the network, 444 Post Offices would be lost by 2017, a decline in the network size of 39% according to the report. ? ?
The two-year social welfare contract is currently held by An Post with possible extensions for up to four additional years. However the Government is committed to moving to electronic payments as part of its eCommerce strategy and this is causing serious concern to the 1,100 postmasters around the country. ? ?
Grant Thornton concluded that Government additional business through the Post Office is necessary to help sustain the network. They found that if motor tax renewals were available in Post Offices it would save the exchequer €60.6m over a five year period. However, Grant Thornton concluded that the additional business alone would not compensate for the loss of the welfare payments business. ? ?
Commenting on the report’s findings IPU National Executive member Vincent Harney, who represents Postmasters in Laois, Westmeath and Offaly, said immediate Government action was required to ensure the viability of the Post Office network into the future. Mr Harney expressed concern that, although An Post had won the welfare payments contract, the Department of Social Protection were actively driving customers into using bank accounts to receive welfare payments. ? ?
“We may have won the contract in theory but the business is being diverted away on a daily basis. We cannot survive if this continues,” he stated. ? ?
Mr Harney welcomed the fact that the Technical Group of TDs, led by Seamus Healy and John Halligan, has put down a private members motion for debate next Tuesday and Wednesday calling for such a plan to be rolled out within three months. ? ?
“We know that the Programme for Government contains a commitment to maintain the network of Post Offices but we are in no doubt that the network is under serious threat,” said Mr Harney. “There is no plan in place to ensure that that commitment is honoured and we need one urgently.”

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