I welcome the Minister to the House. I take this opportunity to thank the members of the Joint Oireachtas Committee on Transport and Communications and its former Chairman, Deputy Tom Hayes, for their efforts in producing this report. I wish Deputy Hayes well in his new role as Minister of State at the Department of Agriculture, Food and the Marine.
According to the committee's report, An Post currently has 1,050 post offices in Ireland and some 9,500 staff, both full-time and part-time. It is, therefore, a major employer with a network that operates in every part of the country. This report adds greatly to the debate on the role of the post office network in this State in the 21st century. As a consequence of Ireland's obligation to comply with the third EU postal directive, we have seen sweeping changes to the postal service. This process began with the decision by the Council in 1994 to open national postal markets to competition. Directive No. 97/67/EC, which issued in December 1997, set out common rules for the development of the internal market of Community postal services.
The market in Ireland has been open to competition since 2000, which has seen significant benefits for end users of postal services. An Post's designation as universal postal service provider has helped to safeguard its key role in the delivery and collection of mail. ComReg, as the designated national regulatory authority for postal services, granted An Post its designation for a 12-year period. There have been many changes for users of postal services over the years. The age of the telegram is long gone. Personal letter volumes have fallen as technological innovations led to greater use of electronic mail. Social media platforms such as Facebook and Twitter are increasingly used as primary methods of communication. Mobile telephone texting is probably the main medium of communication among young people and adults alike. It is a fast-changing world in which stakeholders must constantly adapt and develop new services if they are to prosper.
In that context, it is important to acknowledge that the local post office, as much as the local shop, is a vital focal point in rural areas. Of the 4.6 million people living in Ireland in 2011, 1.74 million, according to the census, resided in rural areas. We cannot afford to see the post office network become obsolete. It must adapt and be innovative in the services it offers. After all, the days of selling stamps and delivering letters are no more. There is competition out there, including potentially from operators who are interested only in making a profit from the Irish market and have little regard for social responsibilities. I agree that Ireland, with a population of 4.6 million and a large, dispersed rural population, cannot be compared with Sweden, whose population of 9 million is concentrated around cities.
The joint Oireachtas committee made nine recommendations in its report. It recognises the social benefit of providing advice and face-to-face contact in rural areas. I have spoken to people living alone who go from day to day without any contact with another person except when they go to the local post office to collect their pension. There are 136,000 people aged 65 and over living alone in this country, according to the census. Given our aging population, that figure is set to rise rapidly in the coming years. We have an obligation to ensure that people can access services as close as possible to where they live. No provider should be allowed to cherry-pick the areas in which they will operate.
The report recommends the continued delivery of Government services to the public. In 2012 the Irish Postmasters Union commissioned a report by Grant Thornton. Given that the current social welfare and National Treasury Management Agency contracts make up 29 and 27%, respectively, of the post office network's retail revenue, that report reflected a considerable concern that its viability might be under threat. In this regard, I welcome the extension of the social welfare contract for a further two years, which will afford An Post more time to develop alternative income streams. Several reports have identified particular services which it could and should be offering, such as motor tax renewals and payment of business rates, local authority rents and hospital charges. I welcome the facility to pay the property tax at one's local post office.
It is a pity this facility was not available last year with the household charge. Other financial collecting services that are currently carried out by local government could be carried out in local post offices. In addition, with the closure of rural Garda stations which were only open for a few hours daily, some services, such as providing insurance documents, licences and passport application forms, could be carried out at local post offices. Items could be scanned and e-mailed to the relevant Garda database and passport office, etc.
The Financial Times reported in January this year that Scotland Yard and the postal service are looking at this type of service. Local post offices are open five and a half days a week and this time should be exploited to the maximum. The report also recommended an early warning system, whereby local communities would have advance notice if their local post office was in danger of closure. This is a very good idea. There is nothing better to catch one's attention about a service that one takes for granted, than the threat of its disappearance or closure. We have had this experience over the past couple of months in County Clare.
The committee identified a phenomenon, particularly in rural areas, whereby the resignation of postmasters and mistresses is leading to the closure of local post offices. The committee heard from Donal Connell, CEO of An Post, that one-third of resignations by postmasters since 2011 resulted in post office closures. Some will say that younger people are not attracted to the challenge of taking on a post office as a career option. I say that if the conditions are there to provide a livelihood, they will queue up to take them on. The more services post offices offer, the more people will come through the door. While post offices offer some banking services, there is scope for more to be added along with some local credit union services. In the age of the microchip anything is possible if we put our minds to it. We produce IT graduates of the highest calibre every year and should employ them to come up with new systems for the post office network that will offer fast, secure, cost effective methods of operating.
The committee's report states: "The department of Finance's strategy for Financial Inclusion 2011 also refers to the important role that An Post could play in the creation of a Basic Payment Account". The banks recognise the growth in the services it offers through the post office network, with AIB reporting that more than 3 million AIB transactions took place in the post offices. Bank of Ireland and Danske Bank also recognise An Post as a suitable business partner. As we are all aware from announcements made this week, Ulster Bank proposes to close more of its branches, both here and in the North. Post offices should be allowed to fill this vacuum. They should not be tied to one or two particular banks, but be able to offer customers of all the banks the same common services they get in their local branches.
I am somewhat confused with regard to recommendation No. 9 of the report which states: "The committee recognises that the introduction of postal codes will lead to efficiencies through changes to work practices. However, the committee expresses concern as to whether some of these changes, involving likely centralisation of sorting, could have negative impacts on the viability of rural post offices." In fact, post goes every night to central locations to be sorted. Once the letter is put in the post box, we need it to get to the recipient as quickly and efficiently as possible. A proper post code will speed this up and will make deliveries to rural areas quicker.
I hope the Minister takes on board the recommendations of report. I have no doubt he will and no doubt that the future of the postal network is bright.