Post Office (PO) bosses have pledged quarter of a billion pounds in added revenue to postmasters by 2030 but warn of “difficult times ahead” as it announces a root and branch shake-up of the business in its latest strategic review. 

Speaking at a press conference this morning, PO interim chairman Nigel Railton laid out a planned transformation over the next five years. He claimed it would signal a “new deal for postmasters”. 

“Standing still and doing nothing is not an option,” he said. “We are a business facing challenges: commercial, cultural and operational. Now is the time to take bold and urgent action.

“Our operations are not set up to serve the evolving needs of our postmasters. For too long postmasters have been underserved and undervalued by a centre that didn’t prioritise it’s frontline,” he added.  

Wide range of changes announced to PO network

Alongside the promise to increase total annual renumeration for postmasters by £1/4bn by 2030, Railton announced a raft of changes to the network. This includes a full overhaul of technology and data, an improvement to in-branch banking services, new products and marketing to drive footfall and a strengthening of the PO’s online offering which postmasters are also set to benefit from. 

Plans also include a rise in the number of banking hubs to 500. However, Railton warned that hard choices would need to be made to achieve lasting financial stability. 

He said: “We need to have an honest conversation about the loss-making parts of our network and our directly managed branches while still meeting the current requirement of 11,500 branches.”

Currently there are 115 Crown post offices which are directly managed by the PO. No indication was given about the future of these. However it is understood they could be cut back, potentially putting 1,000 jobs at risk.  

The new strategy will begin to be phased in immediately, Railton confirmed. In its first year postmasters could expect up to £120m in additional revenues. This would represent a 30% increase in revenue share. However he stressed that, going forward, plans would be subject to government funding. 

Representation and support for postmasters to be improved

Railton also promised to “strengthen postmaster’s voices”. The PO is working to rebuild trust with them, and the public, following the Horizon IT scandal. 

He said: “We want to transform the support you receive from Post Office and strengthen your voice across the entire organisation so that you, our postmasters, are at the heart of this business, “ he said, adding that postmasters will now have representation in all parts of the business from board level to front line staff. 

Neil Brocklehurst, PO acting CEO, said: “Postmasters across the UK serve every generation and this plan not only improves their incomes but also the support that we provide to let them run their businesses and serve their communities.” 

Elliot Jacobs, serving postmaster and a non-executive director on the PO Board, said: “The last few years have been challenging for many retailers and postmasters are no exception. We have faced cost pressures from rising energy prices, increased National Minimum Wage and National Insurance Contributions. It’s vital that the Post Office embarks on this major Transformation Plan so that we have a sustainable financial future, and one that benefits the thousands of postmasters who work tirelessly day-in, day-out to support the local people and businesses who rely on us for essential everyday services.” 

Full details of the strategic review will be rolled out to postmasters from next week onwards, starting initially with a town hall meeting and Q&A session. 

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