The Post Office has announced a £250 million pay increase for postmasters by 2030 as part of a five-year transformation plan, marking a “fresh start” after the Horizon scandal.
The planned “New Deal for Postmasters”, which is subject to government funding, will boost total postmaster remuneration by 2030 by “dramatically” increasing their share of revenue.
As part of the changes, the company is reportedly looking at closing or refranchising most of its crown post offices and cutting up to 1,000 jobs in its head office in a bid to “streamline” the organisation.
‘Burning platform’
Post Office chair Nigel Railton unveiled his plan saying that the employer’s “burning platform” meant that his strategic review had faced “hard choices”.
Postmasters have faced a commercially challenging environment in the past decade, while the Autumn Budget ramped up costs in the form of higher national insurance contributions, a rise in the national living wage and increases in business rates, he said.
The transformation plans unveiled today mean postmasters could expect up to £120m in additional remuneration by the end of the first year, representing a 30 percent increase in revenue share.
The role of postmasters will be strengthened as the employer said it would set up a new Postmaster Panel and Consultative Council that will help inform how the business is run. Investments will be made in cash automation and mails services in-branch to reduce manual tasks and give postmasters more time to serve customers.
‘Learn from past mistakes’
Railton said: “The Post Office has a 360-year history of public service and today we want to secure that service for the future by learning from past mistakes and moving forward for the benefit of all postmasters. We can, and will, restore pride in working for a business with a legacy of service, rather than one of scandal.
“The value postmasters deliver in their communities must be reflected in their pockets, and this Transformation Plan provides a route to adding more than £250 million annually to total postmaster remuneration by 2030, subject to government funding.
“It begins a new phase of partnership during which we will strengthen the postmaster voice in the day-to-day running and operations of the business, so they are represented from the frontline to the boardroom.”
Neil Brocklehurst, Post Office acting CEO, said: “This transformation plan is the first step in a five-year journey that will set up the Post Office for years to come. There are many consumers who primarily shop online, but there also many who struggle to use online services or actively choose to shop on their local high street and who want to be served by a human being.
“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 Post Office 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 NICs. 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.”
