Coalition committed to postal network

BERWICKSHIRE MP, Michael Moore has hit back at suggestions that the coalition Government could be responsible for “the collapse of the rural post office network” after it was revealed that a lucrative contract to process Giro cheques had been handed to American-owned firm Citibank.

The deal to process 350,000 giro benefit cheques a week is worth £20 million and Christine Grahame SNP MSP said that taking this business away from the Post Office network would have a severe impact on the Borders economy.

Describing the move as “a hammer blow” to the network, she commented: “The Liberal Democrats have claimed that they are helping to defend the rural Post Office network in the Borders, but as usual they are saying one thing locally and doing the exact opposite in Government with the Tories.

“The decision is one that will erode the local economy and result in a poorer service right across the region. It would appear that rural post offices are the latest casualty of Liberal and Tory decisions which take no account of local needs.”

But Michael Moore, deputy leader of the Scottish Liberal Democrats, who has previously campaigned hard to protect post offices in the region in the wake of national closures, said that Westminster remained totally committed to the Post Office Network, adding that the number of people cashing giro cheques had fallen quite significantly in recent years.

He said: “This Government has set aside £1.34 billion of funding over the spending review period to secure its future and end the successive Post Office closures we saw under the previous Labour Government.

“While Post Office Ltd has not been successful in their bid for the giro cheque processing contract, this contract is relatively small compared to the Post Office’s annual turnover of approximately £1 billion. The giro cheque contract will be worth around £20 million a year in total, split between the two service providers, PayPoint and Citibank whereas the existing cheque service only accounts for around 1% of total payments made to sub postmasters.

“Less than 250,000 people use the giro cheque for regular payments and this number is expected to continue to fall significantly year on year as people decide to have their benefits and pensions paid directly into their bank accounts.”

People in the Borders will continue to be able to collect their benefits and pensions through the Post Office by opting to open either a Post Office Card account or one of the many basic or current bank accounts that are accessible over the Post Office counter and Mr Moore said these options should help to protect footfall and income for sub-postmasters and the Government would ensure everyone affected by the changes, due to take place next year, received the necessary advice to make the transfer as smooth as possible.

He added: “I have campaigned against the closure of our local Post Offices for many years and I look forward to the key role the Post Office is set to play under Government plans, to deliver services such as the Universal Credit and financial services through Credit Unions.

“It is in these areas where the Post Office will work with both local and national Government in more efficient and innovative ways, putting the network on a sustainable and secure footing.”