The Post Office minister has called for a “frank and open discussion” on shrinking the size of the Post Office network. 

A recently released video from a panel at the National Federation of Sub Postmasters (NFSP) annual conference in mid-May showed Kevin Hollinrake stressing the desire to drive down costs and maximise revenues for branches, but said this could only be done through a “grown up conversation”.

 “It’s easier to have a profitable business if there’s fewer businesses around you. Politically that’s a challenge. No MP wants to see Post Offices  closing in their local area but we need to have a grown up conversation about the size of the network going forward,” he said.

Post Office chief executive Nick Read, who also sat on the panel, confirmed there were no immediate plans to scale down.

He said: “As it stands today, we have 11,500 branches. That’s not going to change until we have some form of formal consultation or change in statute. We shouldn’t expect today to have a different size and shape of network.”

However, Read added that the Post Office would continue to look at how it met changing demand by continuing to revise formats and services. “It’s why we have 687 Drop and Collect points, which count towards that 11,500. We are also reducing the number of outreaches which are extremely expensive and looking at different ways to manage our rural and isolated communities,” he said.

Greater automation was also cited as a key way to drive down costs. Hollinrake said the network should be looking more seriously at self-service tills and automated counting machines.

 In response, Read said that in the future he fully expected banks to support and pay for a part of that automation alongside security measures, while greater automation in parcel and mail would also play a part. 

He said: “We anticipate that we will reduce our operating costs in branch and centrally by anything up to 50% by introducing a system that will genuinely and dramatically reduce the processing time and cost time associated with running a branch. It is a core part of the way forward.”

Concerning any future strategic review Hollinrake pledged that postmasters would “100 per cent” form a central part of any consultation process. “I’ve never been afraid of engaging with any organisation representing postmasters or postmasters themselves. It would be foolish not to engage with the people who really know what’s going on – those people who work in the sharp end in our communities,” he said. 

Read more Post Office news