Denis Naughten
Question:6 Mr. Naughten asked the Minister for Public Enterprise the measures which she intends to put in place to protect the viability of sub-post offices; and if she will make a statement on the matter. [24529/01]
Priority Questions. - Post Office Network.
One of the first commitments I gave, when appointed Minister for Public Enterprise in June 1997, concerned the post office network. I promised that there would be no forced closures of post offices. My position and that of the Government has not changed since then. We remain committed to a viable and competitive post office network. Two reports on the post office network – by Phil Flynn and by an interdepartmental group – both concluded that the post office will face serious challenges in the next few years. They forecast accumulated losses in the post office counter service over the four year period 2001-04 at nearly £80 million, based on current tariffs and the existing network structure. Clearly, the scale of these losses is unsustainable.
The Government, having considered both reports and the scale of losses forecast, accepts, along with all interested parties, that substantial restructuring is required if a viable sustainable post office network is to remain. The Government approved the following measures: An Post need to focus in the short-term on the introduction of pilot postal agency arrangements; the Government agreed to increase the share capital of An Post by £10 million on the basis that this would facilitate the implementation of the overall package of reforms; and in situations where it is impossible to continue a post office service on an agency basis, a Government services outlet network will be developed.
In August, I met the Irish Postmasters Union to discuss the matter. I agreed to its proposal that a forum of interested parties would facilitate negotiations on reform and Phil Flynn has agreed to chair that forum. The first formal meeting of the forum took place on Monday 11 October. The payment of the increase recommended for sub-posters recommended in the Flynn report will be made at the earliest possible date. Discussions have ensued between the company and IPU and I expect payment will be made within the next few weeks.
I know and fully appreciate the work undertaken by postmasters and postmistresses over the years, in terms of providing excellent services to the customer, particularly in rural areas. The postal directive has also enshrined that. I am committed to ensuring that the public service ethos offered by the post office network will remain.
I put it to the Minister that the PostPoint system, which is now being introduced by An Post, will close many sub-post offices, by stealth, by removing many of the services which they currently provide. Does the Minister accept that? Does she also agree the pilot postal agency and the £10 million share capital will not be enough to ensure the viability of sub-post offices? What discussions have taken place between the Minister's Department, An Post and the commercial banks on the operation of a universal bank account? What response has the Minister had from the banking sector to her request for a financial contribution from them for the services now provided by An Post in relation to payment of bills, which has been withdrawn by the commercial banks?
As Deputies are aware, the Competition Authority has intervened in the bill-pay arrangements which had been set up on a global bank basis between An Post and the bank institutions. On a one-by-one basis, An Post is now seeking to implement bill-pay arrangements and, clearly, post offices will be paid on foot of each such payment. With regard to the postPoint arrangement, it is now a year since that was initiated between An Post and the various outlets. If that had not been done, competition was about to come in and that would have wrenched that business away from An Post, without any recompense. That was quite clear, the details are readily obtainable and I can give them to the Deputy. postPoint is now available in 1,000 post offices and sub-sets of it are available in all post offices. I must emphasise that if An Post had not moved on that matter 12 months ago a nationwide competitive element would have been introduced.
In the forum, for the first time, we now have An Post, the Irish Postmasters and Postmistresses Union and officials from the Department of the Taoiseach, the Department of Finance and my Department. This facilitates a very open discussion on what extra work the post offices should get.
The Department of the Environment and Local Government should also be included in that forum, as it has a role to play in generating income in sub-post offices. Have costings been produced on the new Government services outlet network and how does that compare with the current costings of the sub-post office network? postPoint was sold on the sole basis that many of the services currently provided by the sub-post offices will be available through postPoint early next year. In small rural villages, with three postPoint outlets as well as a sub-post office, there is no way a sub-post office can remain viable and compete.
I agree with the Deputy's point about the Department of the Environment and Local Government. That Department has been invited, as has the Department of Agriculture, Food and Rural Development, to make its submissions to the forum. That is one of the issues about which they will be talking.
The Deputy asked about the Government outlet. That only comes into play where there is no post office or where there is no take up by a suitable candidate when there is a vacancy and where an area would lose a post office. It is clear that the best arrangement would be the continuation of a suitable man or woman who would come forward to "person" the post office. That would be the best arrangement. From time to time, that is not possible because nobody is interested or nobody comes forward. It is under that circumstance that a Government outlet will be explored.
In June 1997 the Minister stated that there would be no forced closures of post offices. Will she outline what she has done to date to ensure there are no forced closures?
I have instructed An Post that no post office is to close where a suitable man or woman comes forward—
What has the Minister done to ensure that?
I have told An Post and it has done it. It advertised three times to see if it could get somebody suitable. In any case where it does, that post office will remain. When I went to the IPU conference in April I said I would guarantee that the 12% mentioned by Phil Flynn in his report should, and would, be given. It is about to be given to the postmasters.
It is 9% and they have not got it yet.