I thank the Chairman for the invitation to address the joint committee. I am the director of An Post's retail operations. My colleague, Mr. Steve Clements, is our head of security.
This is an opportune time to meet the committee, as we launched our annual report only two weeks ago. We announced figures for 2009 which reflected well on our response to the economic downturn. We have seen revenue fall by 5.4%, but we have responded by reducing our cost base. Despite very challenging trading conditions, we continued to invest in those parts of the business that will secure a profitable future for An Post in an increasingly competitive market.
I have been asked to talk about the post office network and security issues. An Post's retail business performed strongly throughout the year, with increasing demand for post office-based financial services. The performance of our retail operations has, in many ways, helped to mitigate some of the worst effects of the downturn in other areas of the business. More people are coming through our doors than ever before. We have more than 1.7 million customer visits every week.
Last year customers invested an additional €1.8 billion in State savings products which we operate on behalf of the National Treasury Management Agency. This product range has expanded with the recent introduction of the national solidarity bond which is being sold through post offices since last Tuesday. State savings products are a very important part of business for the post office network, as is the work we do on behalf of the Department of Social Protection. In 2009 we paid out almost €10 billion in social welfare payments. Providing services for all arms of the Government is essential to sustaining a post office network.
Postfone, a new value for money mobile phone service, is being launched this month. It will enable An Post customers to buy mobile phone services through the post office network.
Several new financial services and mail products will also come to the market this year. For example, we are in the final stage of discussions with National Irish Bank on the provision of services for their customers. Earlier this year An Post and its partner BMP Paribas made the difficult but prudent commercial decision to wind down the Postbank joint venture. Following on from this, the One Direct insurance and PostPoint retailer businesses will revert to being wholly owned by An Post.
Our focus remains firmly on maintaining and extending our revenue base. For example, last year we purchased a majority shareholding in the gift voucher shop which trades very successfully in Ireland. We are Ireland's largest retail and services network, serving business and communities the length and breadth of the country. Our 1,185 post offices and 187 postal agencies deliver retail, mail and state services to communities across the country. The vast majority of these offices are operated by independent contractors, with just 57 being operated by An Post staff.
We are going through a change of focus in our post office network. We have already seen new services and products available to customers. We are moving from an emphasis on managing basic transactions to a more comprehensive customer relationship. This is key to the future success of our retail network. As our chief executive, Mr. Donal Connell, said on his last visit to the committee, "Innovation, renovation and investment in the retail network will be our guiding principles."
Over 1,000 post office staff in 300 offices are part of our Customerplus programme. This is essentially a sales and customer service training programme aimed at making the move to serving our customers better. The results so far from our offices in the Customerplus programme have been impressive, with average sales in the top 60 offices growing by more than 8% and in the top ten by more than 22%. A "mystery shopper" programme which we run across our post offices has underscored the success of the Customerplus programme.
Mr. Connell and I told the committee in February 2009 that An Post planned to have a fully automated national network. We are entering the final phase of that operation, as the last of more than 200 non-automated rural offices are brought on-line. Some offices have chosen to close rather than take on this automation programme, determining, for their own reasons, that they wished to exit the business. The computerisation enables these offices to carry on the full range of post office retail services and enables these post office contractors to grow their business and extend the range of services they offer to customers such as post office savings, financial services, general banking, BillPay, mobile top-ups, money transfer facilities, prize bonds and gift voucher purchases.
Committee members may be aware of the recent appearance of a mail service point in local shopping centres or business premises. They may have seen them in the Bridgewater Shopping Centre in Arklow or at Dublin Airport. These machines allow customers to avail of our mail services and buy stamps from a stand-alone unit. A key driver for us is increasing the number of locations at which people can access our services.
There are sensitive issues in respect of the security of post offices and staff into which I cannot go here, and I ask for members' assistance in this regard. The availability of detailed specific information on our security measures in the public domain would be useful for those with criminal intent. The principal priority in our security and crime prevention objectives is the safety of staff and customers. We also aim to safeguard cash which remains a key part of our business. We do this in a number of ways. We have invested heavily in providing each post office with appropriate security aids. Each post office has time-locked safes, CCTV systems, panic buttons, alarms and so on. We have detailed security procedures specific to each office which emphasise to all of our contractors and staff the importance of keeping cash under time lock until it is needed and to have available at post office counters as little cash as is operationally necessary for the efficient transaction of business. We have frequent security seminars at which we update contractors and staff on trends in security matters. Security manuals are available in every office and security alerts are issued electronically where required.
We have audit teams based around the country which examine offices to ensure compliance with our procedures and ensure offices remain vigilant and aware of the importance of full and complete compliance at all times with such procedures. Each successful robbery, from the criminal point of view, puts other post offices at risk, particularly if the amounts of cash taken are excessive. We must be able to demonstrate that big sums of cash are not available when robberies take place. Unfortunately, there was an increase in the number of what we term "security incidents" from 60 in 2008 to 100 in 2009. While this is a 67% increase, the figure represents the total of such incidents, many of which were unsuccessful, as there was no cash loss. In fact, the associated cash losses caused by these incidents showed no material increase. While all security incidents are deeply regretted, it is encouraging to note that the company's investment in security devices and training has been successful. Compliance by the vast majority of contractors and staff with security procedures has also played a vital role, as has the amount of security and anti-crime training we provided for postmasters and their staff in 2009. This extra level of training was provided by the company to prepare us for the changing nature of crime against post offices and staff.
An Post became a signatory to the State-sponsored voluntary code of practice in 2005. The company subsequently invested over €15 million in upgrading security across our retail network. This had an immediate and positive impact on the level of crime, which fell in 2006 and which continued to fall in 2007 and early 2008. We have also fully outsourced our cash deliveries to a professional cash handler, thus ensuring that our own staff no longer deliver cash to our post offices as was the case in the past.
By November 2008, however, the crime rate began to rise again. Crime continued to rise throughout 2009 and is continuing on this upward trend in 2010. This increase in the crime rate is attributed to the current economic climate and not to any weakening of the security measures in place at post offices. Quite the reverse is the case. Members may have seen recent newspaper headlines relating to an increase in robberies. This followed the publication of the Central Statistics Office's recorded crime data for the first quarter 2010. In particular, I draw members' attention to the Central Statistics Office's classification of robberies on institutions. In that context, recorded robberies against institutions rose by almost 10%, but robberies at post offices account for only 4% of the total. The latter figure is down from 6% last year. While each robbery is regrettable, considering the size and spread of our retail network, this shows that An Post is not particularly victimised.
We will continue to invest heavily in security measures both nationally and at post office level. We will also continue to train staff and contractors in security techniques. We are confident that our investment in this regard has been successful in preventing crimes and deterring the criminals.
Within our security services, we also have a dedicated crime prevention unit which works closely with the Garda in order to mitigate any emerging crime threats. In this regard, I refer to the recent phenomenon of so-called tiger kidnappings. The unit actively supports staff and postmasters through the provision of both physical and electronic security products, as well as producing the necessary protocols and procedures that are designed to promote safety and security. We also spend a great deal of time, effort and resources in research and development in order to keep both abreast of technology and, hopefully, one step ahead of the criminals. This is a national problem. We are doing everything possible to make life difficult for criminals. We are particularly conscious of our duty of care to our staff, contractors and customers and this underpins everything we do.
We are conscious that these are difficult times for everyone, particularly our customers. We are focused on the need to broaden our revenue base. Most importantly, however, we are focused on the need to improve both the service and the range of services we provide for our customers in a trusted and safe environment. Only in this way will we deal with the current economic downturn and build firm foundations for the future.
