Appendix 3: Postwatch Response
Postwatch response to the Business, Enterprise
and Regulatory Reform Committee on the post office closure programme
Role of Government and the future of the network
1. In answer to a Parliamentary Question, the Government
said a network of around 7,500 offices would suffice to meet the
national criteria. We do not think it is satisfactory simply to
accept that the network may continue to shrink in an unplanned
way between now and 2011; Post Office Ltd should be obliged to
use its best endeavours to keep the network at a minimum of 11,500
fixed outlets. (Paragraph 7)
Postwatch response:
We agree with the Committee's concern over the
future of the network. The Government needs to outline its future
strategy for ensuring the post office network does not fall below
11,500 branches. We look forward to this clarification in its
response to the Committee. Additionally, Postwatch will write
to the Government on this matter.
The Consultation Process
2. We urge the new National Consumer Council
to place continued monitoring of the post office network among
its highest priorities. (Paragraph 8)
Postwatch response:
We agree that the statutory body responsible for
representing post office customer interests must continue to monitor
access to post office services. It is essential that the new NCC
is closely involved in determining Government policy, both up
to 2011 and after.
Postwatch will continue to work closely with those
setting up the new NCC's work on the post office network. Postwatch
will undertake an evaluation of how it carried out its role in
the closure programme, so that the new NCC does not lose the knowledge
gained by Postwatch. In addition Postwatch will, of course, make
its post office database and GIS system available to the successor
organisation.
3. Post
Office Ltd should be far clearer about the basis on which the
public is being consulted. All its literature should make it clear
that there will be reductions in Post Office provision, and that
the question being asked is simply whether the right branches
have been identified for closure. (Paragraph 12)
Postwatch response:
We agree that POL's communications materials need
to be clear that the public consultation is not about how many
post offices should close, but about which ones should close.
In our evidence to the Committee we outlined our
own concerns with POL's communication materials. We have again
written to POL to offer to assist with a review of its consultation
materials, and have requested this takes place as a matter of
urgency. We will update the Committee in our next progress report.
Confidentiality
4. If people are to respond sensibly to proposals
to close a particular sub-post office, they need to know why that
branch has been put forward for closure. There may be some details
which need to be kept confidential, but this should be strictly
limited, given the substantial public investment in the network
and the keen public interest in the outcome. We welcome the fact
that Post Office Ltd has been prepared to share more information
as the process has evolved; it should give such information at
the outset of the consultation process. (Paragraph 14)
Postwatch response:
We agree with the principle outlined by the Committee
that POL should be as open as possible. Customers, communities
and their representatives should be given all the information
that can be shared so as to help stimulate interest and participation
in the consultation process.
We specifically welcome the Government's confirmation
in the House that POL "is prepared to share an estimate
of the total individual branch saving with the relevant Member
of Parliament on a confidential basis" (Hansard,
5 February, column 216WH). We hope POL will be proactive in its
approach to working with MPs on this matter.
5. Area
Plan Proposals and their associated publicity should make it clear
that closure, although likely, is not inevitable, and that the
status of post offices scheduled to remain open may change. The
notification that an office, is to remain open should be far more
clearly worded. (Paragraph 16)
Postwatch response:
We agree that it is important that those post
offices proposed for closure which remain open should not be blighted.
They need to attract customers that may have already started to
use an alternative post office. POL's communication materials
are important in this respect. We have written to POL to offer
to assist with a review of its consultation materials
6. The Chief Executive of Post
Office Ltd told us that the proposals in Local Area Plans were
refined through the pre-consultation process and that this preparation
is some compensation for the limited time allowed for public consultation.
If this is so, commercial confidentiality should not prevent Post
Office Ltd from holding the discussions necessary to make sensible
proposals. (Paragraph 17)
Postwatch response:
We agree that POL should do all it can to ensure
the proposals that enter public consultation are sensible and
robust.
Local Authority and MP involvement
7. We also note that although Postwatch appears
to be doing a good job in influencing proposals in the pre-consultation
period, several of the MPs who responded to our request felt that
Postwatch could have been more closely involved in discussions
with them. Postwatch is the only organisation able to take proposals
to review; it would be helpful if it always discussed its position
with interested MPs. (Paragraph 20)
Postwatch response:
Postwatch writes to all relevant MPs and local
authorities at the beginning and end of public consultation. We
have also met or spoken with many MPs about proposals within their
constituencies. However, in response to the Committee's request
we will now write out again towards the end of the public consultation
to remind MPs of our contact details, to detail the review process,
and to offer a discussion.
Profitability
8. Local authorities and local MPs should
be more closely involved in the pre-consultation process. Postwatch
appears to be doing a good job, but it simply does not have the
wider responsibilities of local government, or the representative
role of MPs. The Chief Executive of Post Office Ltd told us that
local authorities were involved in drawing up local area plans
before they went out to public consultation; clearly, some local
authorities do not feel they have been properly involved. Local
Area Plans would be improved if local authorities and Post Office
Ltd worked together. (Paragraph 21)
Postwatch response:
We agree it is important that local authorities
are included in the development of area plans and have the chance
to input relevant data. We will continue to work with POL to ensure
they engage with local authorities throughout the programme.
9. Postwatch
should scrutinise proposals to close post offices which are commercially
viable for Post Office Ltd particularly closely and, if necessary,
have powers to block them. (Paragraph 22)
Postwatch response:
We understand and share the Committee's concerns
relating to the possible closure of profitable post offices. We
welcome Alan Cook's assurance that closures will only take place
where the result is a material saving to POL. This, however, is
not an assurance that profitable branches to POL will not close.
Postwatch agrees with the Committee that such proposals would
need to be carefully consideredprofitable offices are likely
to be heavily used, and closures would therefore affect many customers.
However, Postwatch has not argued for the power
of veto over any closure and believes the decision on whether
or not a branch closes should rest with POL. Postwatch's strength
is its ability to represent customer interests. This must remain
our focus. We are, of course, active locally in querying POL's
rationale for proposing particular branches for closure. However,
a power of veto on decisions would require an independent analysis
of POL's business model, accounting practices, and financial projections
- activities that Postwatch does not have the statutory remit
to undertake.
Alternative support for Post Offices
10. We welcome Post Office Ltd's apparent
willingness to contemplate introducing locally supported post
offices. (Paragraph 24)
Postwatch response:
We agree it is important that POL is innovative
and flexible in ensuring that access to post office services is
maintained throughout the UK. In most cases access to these will
be best maintained via a commercial enterprise but there will
be places where a locally-supported community effort is the way
of meeting customer needs.
Management style
11. The Post Office's future is a matter of
public debate. As we have said, Post Office Ltd is not solely
a commercial enterprise. Its network provides access to essential
services, and has a greater reach than any other. The Government
is the sole shareholder, and the public has a right to expect
Government-controlled enterprises to behave in an exemplary
way. After the experience of this inexcusable lapse, we expect
Post Office Ltd to do so in future. (Paragraph 28)
Postwatch response:
We agree with the Committee. It is crucial to
the successful outcome of the closure programme that all interested
parties have productive and respectful working relationships.
The Government Access Criteria
12. The evidence we have received from local
authorities suggests the detailed information required to implement
the access criteria properly has not always been taken fully into
account. We are particularly concerned that in some cases the
local area plan has failed to reflect arrangements to transfer
Crown Offices to franchised premises in a different location.
If Post Office Ltd cannot take into account information about
matters that it controls, confidence in the wider information
underlying these plans is undermined. Post Office Ltd must do
more to demonstrate that local area plans are accurate and based
on current information. (Paragraph 31)
Postwatch response:
We agree that it is important that POL does everything
it can to make the consultation process robust.
In its evidence to the Committee, Postwatch outlined
the concerns it had with this issue in Liverpool where the future
of the Crown office is under review. POL has now resolved this
situation and it is essential that it takes future franchising
plans into account in its area plan consultations.
13. We
underline the fact that the geographic access criteria are national,
and can be met even if coverage in certain local areas falls well
below the national standard. We do not know the extent to which
the national criteria are met in each local area plan. We expect
Post Office Ltd, as far as possible, to take the geographic access
criteria into account at local area plan level, not just meet
them nationally. (Paragraph 32)
Postwatch response:
We welcome the Committee's view on this issue.
For every proposal, Postwatch looks at the distance
customers would have to travel following a closure, and seeks
to ensure that POL takes this into account along with other local
factors such as public transport, demographics, terrain and impact
on the local economy.
Looking beyond the current programme, we believe
the new NCC should continue to monitor the network and report
to Government if gaps appear in access to post office services:
currently the only local criterion is that 95 percent of customers
in each postcode district should be within six miles of a post
office.
Accessibility
14. We welcome the fact that Postwatch surveys
proposed franchises for accessibility. We trust it also considers
accessibility when it considers proposals for sub-post office
closure made as part of the Network Change Programme. However,
we are far from convinced that Post Office Ltd itself is fully
engaged with the need to ensure that services are accessible to
all. This needs to be given much higher priority. (Paragraph 34)
Postwatch response:
Postwatch agrees with the Committee that this
is an important issue. POL provides information on disabled facilities
and service at nearby branches as part of its pre- and public
consultation materials. We examine this issue very carefully and
will oppose a closure if it leaves customers with significantly
worse facilities than at the closing branch.
In addition to its work during the programme,
Postwatch carries out local monitoring of facilities and service
levels at post offices throughout the network. Monitoring of a
particular branch may be in response to complaints from customers
or as result of local knowledge and research. Postwatch raises
its findings with POL and asks them to take necessary steps to
improve the customer experience.
Local economies
15. We believe that there should be a presumption
against closing a post office where this is the last shop in the
village, or in a deprived urban area. (Paragraph 35)
Postwatch response:
We understand the position taken by the Committee
but we would find this a difficult recommendation to support.
Where a post office is located in an urban deprived
area or is the last shop in the village, Postwatch believes this
is an important factor to consider in conjunction with other local
factors. Before proceeding with the closure of these post offices,
POL should fully consider other important local factors such as
distance to the nearest alternative post office, availability
of public transport, terrain, demographics and other impacts on
the local economy, for example access to cash.
16. Post
Office Ltd must take great care to ensure that any reduction in
compensation to a sub-post office that closes, but where the remaining
business intends to offer new and competing services, is not excessive.
The purpose of reducing compensation is to limit competition with,
and encourage business to migrate to, remaining post offices nearby.
The argument for this reduction is weaker in areas where there
is no ready access to such offices. Because of the importance
of such facilities to the local communities, Post Office Ltd should
always be realistic in its assessment of the degree to which alternative
services would really displace business for the post office network.
When reaching its decisions it should give the benefit of the
doubt to the business and so to the people it serves. (Paragraph
38)
Postwatch response
We agree with the Committee that a solution must
be found that balances taxpayers' interests with the needs of
local communities.
17. The
timetable for the Network Change Programme is extremely compressed.
We would be concerned if postmasters had to decide whether to
accept the cut in compensation before they had the time to establish
whether they could attract bill payment or other services, or
explore the terms of such contracts. Postmasters should
be given adequate time to explore these factors before deciding
what compensation to accept. (Paragraph 39)
Postwatch response:
We agree that the timetable for the Network Change
Programme is challenging and that there is a risk therefore that
decisions could be rushed. Where possible we hope POL can allow
the leaving subpostmaster the time to take soundings locally of
likely demand for bill payment and other services.
Outreach
18. We agree that open-ended questions about
the type of Outreach which may be appropriate are not helpful
but welcome the fact that in recent consultations Post Office
Ltd suggests what Outreach arrangements could be provided. We
also welcome the assurance that Outreach services will continue
until at least 2011. In addition we welcome the statement from
Post Office Ltd that they are prepared to consider Outreach services
in areas which had previously lost their postal services but are
within the new national criteria. (Paragraph 42)
Postwatch response:
We agree that consultation on proposed outreach
options needs to be based on a worked-up solution. Customers are
unlikely to engage with an unfocused consultation.
Postwatch welcomes the funding made available
for outreach services until 2011. We also welcome POL's commitment
to individually review how outreach are operating once established
and hope this will be an opportunity for POL to further tailor
services to needs to the local community. We would welcome clarity
from POL on what commitment it has made to retain outreach services
until 2011.
19. We believe a single outreach
session of two hours a week is generally unacceptable; there should
normally be at least two sessions per week. (Paragraph 43)
Postwatch response:
We agree with the Committee that a single outreach
session of two hours per week is generally unacceptable. Postwatch
has called for outreach services to be available for at least
two consecutive hours, three days per week. We believe BERR must
look again at setting minimum hours and also a minimum product
range. We will seek a meeting with BERR on this topic and feedback
our progress in our next report to the Committee.
20. We
welcome the proposals to introduce Post Office provision to remote
areas. If this cannot be done by voluntary Outreach arrangements,
we expect the Post Office to provide the necessary services itself.
(Paragraph 44)
Postwatch response:
We agree with the Committee that POL is responsible
for ensuring that the access criteria are met in all parts of
the UK. It is reassuring that POL so far has been able to find
sub-postmasters willing to operate outreach services. Where sub-postmasters
cannot be found to operate outreaches in remote areas, POL should
bear responsibility for ensuring needed services are established
and maintained.
Proportionality
21. We welcome the fact that Post Office Ltd
appears to be taking a flexible and pragmatic approach to the
requirement that the closures should not fall disproportionately
in particular areas, and that its programme takes some account
of the varying levels of current provision. (Paragraph 45)
Postwatch response:
We agree it is important that POL takes account
of current provision when drawing up area plans. We will continue
to look at each area plan to seek to ensure that no areas are
disproportionately affectednot only in terms of closures,
but also in terms of postprogramme customer access to post
office services.
22. The Network Change Programme
has a difficult balancing act to perform between responding to
local needs and concerns and ensuring that the necessary reduction
in the network is achieved. We welcome the Minister's assurance
that areas which are considered late in the process will not be
disadvantaged. We intend to keep this, and other aspects of the
programme, under review. (Paragraph 46)
Postwatch response:
We also welcome the Minister's assurance. We will
continue to provide the Committee with regular reports to help
it monitor this recommendation as well as the programme as a whole.
Conclusion
23. Post Office Ltd has been given the task
of reducing the network by a fixed number of branches in a fixed
period. The Network Change Programme began in July 2007 and the
final consultation is scheduled to end in October 2008. That is
a very challenging timetable. As we always feared, this has meant
that consultation has been curtailed, and the whole process has
been rushed. The failure to realise at the outset that the consultation
timetable should take account of the "purdah" for local
elections, and the failure to allow properly for the effects of
holidays on consultation periods, are symptoms of this. The process
has been improving as more experience is gained, but problems
remain. There is not enough clarity about the basis of the consultation;
we are concerned that accessibility is not always taken into account;
commercial confidentiality has prevented sensible discussion.
We hope that all those involved will use this Report as a prompt
to make further improvements. (Paragraph 47)
Postwatch response:
We welcome this report and the Committee's acknowledgement
of the efforts Postwatch are making on behalf of customers. We
will work with POL and BERR to ensure the recommendations are
fully considered.
We strongly believe that the Committee's continued
interest is key to maintaining reasonable customer access to post
office services up to and beyond 2011.
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