Postmasters have seen £112million wiped off their fees in seven years while boss paid £3.7million

Postmasters have seen £112million wiped off their fees in just seven years while boss Paula Vennells has been paid £3.7million over the same period

  • Federation of Sub-postmasters says members are struggling to make ends meet
  • Row comes after former boss Paula Vennells, was paid £3.7million over six years 
  • Has led to calls for her to be stripped of her CBE, awarded ‘for services to the Post Office and to charity’

Former Post Office chief executive Mrs Vennells, 60, received more than £3.7million over six years

The fees that sub-postmasters are being paid to provide essential services have plummeted by £112million since 2012 – despite a crisis that threatens the future of the network.

The National Federation of Sub-postmasters has called for remuneration to be increased as many of their members are struggling to make ends meet.

The row comes after the Mail reported that former chief executive of Post Office Limited, Paula Vennells, was paid £3.7million over six years – leading to calls for her to be stripped of her CBE.

Every time a branch provides a service such as selling stamps, processing passport applications or handing out benefits, they get paid a levy by central company, Post Office Limited.

But the total amount of fees paid to struggling sub-postmasters has fallen from £483million to £371million since 2012, accounts reveal.The sub-postmasters claim that although part of this fall is due to customers heading online, it is mainly because the individual fees they are paid for providing some of these services have actually been cut. They say it is outrageous that some of these fees have been reduced at a time when their members are struggling to survive financially.

The Mail has been campaigning for better protections for Britain’s post office network, with thousands facing the threat of closure. Many sub-postmasters say that the money they make is so low, that they are not even earning the minimum wage for the hours they work.

Former Post Office chief executive Mrs Vennells, 60, received more than £3.7million over six years, which included her salary, bonuses and cash in lieu of pension and benefits. Last year, she was awarded two hefty bonuses adding up to £390,000 on top of her £225,000 base salary. Her total pay jumped 7 per cent to £720,000 – nearly five times Theresa May’s £150,402-a-year salary.

Last week, MPs were told changes to prevent post office closures had been an ‘unmitigated disaster’ and left the network ‘looking over the precipice’

Sub-postmasters yesterday voiced their support for Mrs Vennells’s CBE to be taken off her.

Last week, MPs were told changes to prevent post office closures had been an ‘unmitigated disaster’ and left the network ‘looking over the precipice’.

In the face of mounting opposition, the Post Office has now been forced to launch a ‘special review’ into the fees paid to sub-postmasters. Last night, campaigners and politicians called for an immediate promise to boost these payments to ensure the network is sustainable.

Calum Greenhow, of the National Federation of Sub-Postmasters, said: ‘We would like to see a commitment now that remuneration will be increased. The Government must also give the customers the chance to access services in the post office if they don’t want to go online.’

Post Office Chairman, Tim Parker and former Post Office Chief Executive, Paula Vennells who was awarded a CBE 'for services to the Post Office and to charity'

Post Office Chairman, Tim Parker and former Post Office Chief Executive, Paula Vennells who was awarded a CBE ‘for services to the Post Office and to charity’

Labour whip Chris Elmore said: ‘Many post offices rely on postmaster commission to remain financially sustainable. The £112million black hole… has left many post offices struggling yet further. It’s clear the Government isn’t doing enough to ensure the Post Office delivers for the people who need it most. Ministers must act swiftly and decisively to ensure the Government invests in our community post offices.’

The Post Office Limited has also been forced to renegotiate a deal with high street banks over the fees paid to sub-postmasters for banking related services. From October they will increase fees paid to postmasters for processing an £8,000 deposit from £3.12 to £8.16. The company said it had invested heavily in postmasters’ retail business as part of a recent transformation plan.

A Government spokesman said: ‘It is crucial that running a post office is attractive and sustainable… the Post Office will be undertaking a wide review of postmaster remuneration.’  

Postmasters’ fury after minister claims the network is more stable ‘than in many years’ as hundreds of branches are facing closure

Minister for small business Kelly Tolhurst said she was ‘proud’ that government policy ensured ‘branches serving our rural communities can stay open’

Minister for small business Kelly Tolhurst said she was ‘proud’ that government policy ensured ‘branches serving our rural communities can stay open’

Postmasters spoke of their fury last night after the Post Office minister claimed the network was the ‘most stable’ it had been in years.

In a letter seen by the Daily Mail, minister for small business Kelly Tolhurst said she was ‘proud’ that government policy ensured ‘branches serving our rural communities can stay open’. She boasted that the Post Office, which is owned by the Government, had ‘returned to profit after 16 years of losses’.

Writing to MPs last week, a day after postmasters told MPs their network was ‘looking over the precipice’, she said: ‘We recognise the Post Office’s distinct social purpose and the important role post offices play in communities across the country. This is why we committed in our 2017 manifesto to safeguard the network, protect existing rural services and work with the Post Office to extend the availability of business and banking services.’

But postmasters and MPs said the Government has not promised to fund rural branches past 2021 and that sub-postmasters remain severely under-compensated.

The Mail launched a campaign last week to protect local post offices after it was revealed that branches employing up to 2,500 people were at risk of being closed or downsized in the next year.

The union representing sub-postmasters said Miss Tolhurst’s letter showed ‘inertia and complacency’. Andy Furey, of the Communication Workers Union, said: ‘This letter confirms that the Government is allowing the Post Office to sleepwalk into a nightmare.

‘The Government is in denial about the financial situation the postmasters are faced with. Postmasters will walk with their feet and leave. Taking over a post office is no longer attractive, meaning local branches will close down. [Ministers] are putting their head in the sand even after the Daily Mail’s campaign and what was said at the select committee. It’s very disappointing.’

Andy Slaughter, Labour MP for Hammersmith, said: ‘The Government is aiding and abetting the closure programme. They are giving cover to what is a wholesale rundown of both the main crown and branch network across the country. Where Post Office Ltd is destroying an essential national service, the Government needs to step in to stop that rather than making excuses.’

The Government has aimed to reduce the amount of taxpayer money spent on the Post Office in investment and subsidies.

But postmasters say 3,200 remote branches that are labelled as the ‘last shop in the village’ are at risk because ministers will not guarantee a £50million-a-year subsidy that keeps them open. 

Why I, as an ex-postman, say we must ALL back this Campaign 

Alan Johnson, 69, Former Home Secretary

Alan Johnson, 69, Former Home Secretary

By Alan Johnson, Former Home Secretary

When I was a young postman in the early Seventies, I saw every day how the post office network provided a unique service, from pensions to parcels and everything in between. Even more importantly perhaps, they were also at the heart of the local communities they served, and people loved them.

They still do. Post offices are a vital part of Britain’s social fabric, and that’s why the Mail’s campaign to save them is a crusade that everyone, from all political backgrounds, should support.

Many villages and market towns have lost their bus services, their bank branches and even their pubs. Sub-post offices are all that remains of the glue holding these rural communities together. They are a lifeline, and it would be a travesty to lose them.

The network has already been reduced to its lowest sustainable level.

When I started work in the mid-Sixties, there were 24,000 post offices in the UK. In 1992, when I became secretary of the Union of Communication Workers, that figure had fallen only slightly to 21,000. But over the past quarter of a century there has been a huge decline, to 11,500. If we allow that figure to fall any lower, life outside the big cities will be severely affected.

I first worked as a postman in London, but I soon moved out to Slough, where my employers taught me to drive. I was then given the rural round of Littleworth Common, in Buckinghamshire. It included the Home Secretary’s official residence, Dorneywood – I never dreamed that one day I’d hold that ministerial post myself.

I’d drive for miles between each farm, bringing the newspapers and even stopping off to lug bags of coal for elderly customers. I’d stop and chat to residents, bringing bits of news and messages from afar. I didn’t have a black and white cat on my front seat – the regulations wouldn’t permit it – but in most respects I was like an old-fashioned Postman Pat. But although the Royal Mail postal delivery service isn’t at risk, the sub-post offices where I used to pick up mail and chat to the staff are in danger of closing.

Everyone in rural areas, especially small businesses, relies on the post office. And you can’t put a price on the local knowledge and watchful eyes of their staff. If, for example, Mrs Jenkins hasn’t been seen for a couple of days, the postie might be the first to notice and mention it to post office staff. And for customers who are feeling lonely or isolated, who perhaps live alone, popping into the post office for a natter can be a daily highlight.

‘The post office has to adapt. It needs to keep giving people new reasons to walk through the door. But I don’t believe that all these reasons have to be automatic money-spinners’

Without the post office, life in many rural places would fall apart. There used to be a saying in my union: one of our members walked or drove past every one of the 26million addresses in Britain every day, Monday to Saturday. No other organisation could make such a claim.

But it’s not only rural communities that are dependent on the local post office. In urban areas where industry has declined, where the steel works have closed or the mine has shut down, they are just as invaluable.

The world is changing but the post office has just as great a role to play. For a start, we’re all having far more packages delivered each week, as a result of internet shopping.

There’s lots of competition in the parcel market, but I can see an easy and obvious way to ensure local post offices benefit: they can act as collection depots. If you’re out when a parcel is brought to your home, the delivery agent could drop it off at your local post office for you to collect later. That ought to generate both income and custom, bringing people into the shop.

The key to survival is to treat all the challenges as business opportunities.Bank branches are closing daily – about 750 last year alone. But people still need somewhere to pay in cheques, settle their utility bills, pay off their credit cards or withdraw cash.

Many of these things can be done via online banking, but that doesn’t suit everyone, especially the elderly. And there’s certainly no fee for popping into the PO where staff can provide a friendly service and a bit of guidance.

There’s a certain justice in the thought that help with banking could help rescue the post office, because many people trace the start of its decline to 1982, when OAPs were first able to have their pensions paid directly into their bank accounts. Until then, they had to queue up to collect cash over the post office counter each Thursday morning.

The National Federation of Sub-Postmasters foresaw the damage this change would do to their business and staged a major demo, but there was no way to stave it off. How could anyone have guessed that within 40 years, cash itself would be practically redundant?

The post office has to adapt. It needs to keep giving people new reasons to walk through the door. But I don’t believe that all these reasons have to be automatic money-spinners.

The post office has evolved so that profitable parts of the business help other areas to stay afloat. That’s been a basic part of its thinking ever since the days of the Penny Post, when a flat-rate stamp could carry your letter just around the corner or to the other end of the country. To learn more about how the Victorians designed the postal system to be the lifeblood of rural communities, I warmly recommend you read Flora Thompson’s lovely Lark Rise To Candleford novels. They really spell out the importance of the village post office, as it has been for a century-and-a-half.

If you want an illustration of how important the network still is, consider this: add up all the branches of Tesco, Sainsbury’s, Waitrose, Asda, and Boots the chemist and there are still more local post offices. That’s how ubiquitous and essential the institution is.

Trying to imagine a country without it is like picturing a modern world without supermarkets: practically impossible.We cannot allow this wonderful service to fade away through complacency.

Of the country’s 11,500 local post offices, 53 per cent are in rural communities. In 2016, the Government said it is committed to ensuring that 90 per cent of the population lives within a mile of their nearest branch. All the major political parties are agreed we cannot let that slip any further. Yet two ominous dates are looming closer.

When the Royal Mail was privatised in 2012 and prised away from post office Counters (which is still owned by the Government), an agreement was struck that they would continue to use each other’s services. That agreement is due to expire in 2022. And even before that, in 2021, the government subsidy to the Post Office will run out.

These are two crucial elements that protect the entire edifice, and they are about to disappear. The Government has to tackle this now.

We cannot wait until the last minute. The very existence of our local post offices depends on it. And the country cannot do without them.

 

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