The UK’s Post Office has confirmed that the last of its 108 Directly Managed Branches has been franchised.
The Post Office, which is owned by the UK government, announced in April that it was moving to a fully franchised network as a result of losses sustained by its Directly Managed Branches, estimated at over £40m a year. It said around 1,000 staff would be offered the choice to work for the new owner or take redundancy, adding that the decision to move to a franchise model was taken to help fund increases in the remuneration Postmasters receive.
Its Inverness branch was the last to become a franchise and is now formally operated by the Co-op Group.
Neil Brocklehurst, Post Office Chief Executive, said: “Moving to a fully franchised network is one part of enabling the Post Office to deliver a ‘New Deal for Postmasters’, helping to create a long-term, sustainable future for the Post Office.”
He added: “We will ensure all Postmasters and retail partners across our network benefit from increased remuneration as a result of this franchising process. But crucially, also ensure customers continue to access our products and services at or close to the locations where these Directly Managed Branches were located.”
The Communication Workers Union believes the franchising model is a cost-cutting exercise that threatens jobs and public services and has called for government intervention. It is negotiating for better redundancy packages and redeployment opportunities for its members.
The Post Office has been at the centre of a major scandal, causing significant financial fallout, after it emerged that hundreds of sub-postmasters had been wrongly prosecuted – and, in some cases, imprisoned – due to IT errors.
