3,000 post offices branches have been saved, after government years of dithering ended & handed the P.O. the contract for pensions and benefits payments (POCA). Fears the government was to hand the contract to a rival bid when Work and Pensions Secretary James Purnell announced the award to the Post Office in an effort to protect it from the fallout of the “Gordon Brown Effect”.
Fears that another much larger tranche of Post Offices would close if they had lost the contract had attracted much criticism from the fervent campaigners & others against the £150 million contract being lost by the P.O. to another company.
The contract is critical to many post offices which have struggled as income streams drop. The governments indecisiveness over the years has ensured that many PO became ripe for closure as the strategy for the long term seemed none existent, this led to many sub postmasters taking the money & running with ensuing closures causing much consternation in the local communities. It also made any PO business for sale difficult as any proposed buyer was unsure on the longevity of their purchase, the announcement may assist in building confidence within the PO sector whilst making the purchase of a PO business more attractive to any purchaser.
In effect the proposed competitive tender has been cancelled & as is the norm with this government taxpayers have been the real losers once again as the process will have cost many millions of pounds. The rival bidders including PayPoint will be entitled to compensation, with the Government agreeing to pay all ‘reasonable’ costs, this is on top of legal fees.
Around four million use the Post Office Card Account (POCA), half of whom are pensioners, Labour had announced intentions to cancel the system two years ago, but the intensity of the anti closure campaign & the present economic climate have caused them to back away from the cancellation & the tender process, whether this will have any E.U. repercussions is anybodies guess as technically the tender should have taken its course, we shall have to wait & see if the UK suffers any further financial costs imposed by the EU if they see a case for a lack of due process. |
