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Council bids to run post offices Council bids to run post offices
(about 5 hours later)
Essex County Council has become the first local authority in the country to discuss taking over the running of post offices earmarked for closure.Essex County Council has become the first local authority in the country to discuss taking over the running of post offices earmarked for closure.
The council is negotiating a buy-out price from the Post Office and said some 15 branches could be saved within two months.The council is negotiating a buy-out price from the Post Office and said some 15 branches could be saved within two months.
The closures in Essex were among 2,500 nationwide announced in 2006 in a bid to stem network losses of £4m a week.The closures in Essex were among 2,500 nationwide announced in 2006 in a bid to stem network losses of £4m a week.
Postal affairs minister Pat McFadden has given approval to the scheme.Postal affairs minister Pat McFadden has given approval to the scheme.
And the Post Office said it was willing to work with other local authorities on similar takeovers.
Subsidy
The Post Office gets a £200m government subsidy to offset some of its losses.
HAVE YOUR SAYIn principle it seems the right thing to do but since councils are hardly renowned for financial competence, I expect it will quickly be used as an excuse for raising council taxSteve, CambridgeSend us your commentsHAVE YOUR SAYIn principle it seems the right thing to do but since councils are hardly renowned for financial competence, I expect it will quickly be used as an excuse for raising council taxSteve, CambridgeSend us your comments
Essex County Council moved to allay fears that council tax payers could end up subsidising what has been a huge loss-making business. The council set out to allay fears that council tax payers could end up subsidising what has been a loss-making business.
It said it believed it could make a profit by combining postal services with council services.It said it believed it could make a profit by combining postal services with council services.
Councillor Stephen Castle said some 15 other local authorities had expressed an interest in its project. Councillor Stephen Castle said some 15 other local authorities had expressed an interest in its project and the Post Office said it was willing to work with others on similar takeovers.
"We have had interest from right across the country - people are clearly very worried about the future of their post offices." "We have had interest from right across the country - people are clearly very worried about the future of their post offices," said Mr Castle.
Other councils will be watching what happens with Essex to see if this is the way forward Edward Welsh,Local Government AssociationOther councils will be watching what happens with Essex to see if this is the way forward Edward Welsh,Local Government Association
Council leader Lord Hanningfield said he was "delighted" that the council might be able to save some post offices under its "unique and groundbreaking" deal. Council leader Lord Hanningfield called the move a "unique and groundbreaking" deal but said there is still work to be done to assess the financial merits of the plan and how best to serve the community.
He said: "There is a huge amount of work still to do and we will now be conducting our own assessment on the merits and financial viability of each post office, together with the needs of the communities that they serve.
"Because of this, it is too early to mention specific branches at this stage.""Because of this, it is too early to mention specific branches at this stage."
He added the scheme was "not about replacing one public subsidy with another".
The aim was for any investment to be used over three years to help each branch to move towards becoming financially self-sufficient and "cost neutral" to the council, he said.The aim was for any investment to be used over three years to help each branch to move towards becoming financially self-sufficient and "cost neutral" to the council, he said.
Rising lossesRising losses
Mr Castle told BBC News the council hoped to be able to reopen 15 or 16 of the 31 post offices which had recently closed in the county, using the same staff where possible. Mr Castle told BBC News the council hoped to be able to reopen 15 or 16 of the 31 post offices which had recently closed in the county.
It said it would be announcing which branches these would be in the next few weeks.
In the longer term, he said it was hoped new models would be found to enable post offices to become self-sufficient. This could be by combining them with other services such as schools or libraries, he suggested.
It should be a service that is geared to customer needs rather than to traditional ways of doing things and traditional opening hours Andy BurrowsPostwatchIt should be a service that is geared to customer needs rather than to traditional ways of doing things and traditional opening hours Andy BurrowsPostwatch
He said: "The problem is the government and the Post Office haven't, I don't think, taken time to actually think outside the box and think of a different way of doing it."
The scheme has the backing of the Local Government Association, which represents local authorities in England and Wales.The scheme has the backing of the Local Government Association, which represents local authorities in England and Wales.
It denied it would be a waste of taxpayers' money but stressed the subsidy the Post Office gets from the government should go to councils to help them run "these essential services".It denied it would be a waste of taxpayers' money but stressed the subsidy the Post Office gets from the government should go to councils to help them run "these essential services".
Edward Welsh, of the LGA, said: "Other councils will be watching what happens with Essex to see if this is the way forward." But a taxpayers' group warned that local councils are already struggling to provide basic services without branching out into running post offices.
Andy Burrows, of industry watchdog Postwatch, said a changing commercial environment had made it hard for post offices to fulfil their important social function, as they had less government business to carry out and found it harder to attract customers. "We think it is extremely risky," said a TaxPayers' Alliance spokesman. "If councils can't collect the bins on time what reason is there to think that they'd be able to run the post office?"
He told BBC News he hoped any local authorities which took over post offices would be able to apply "true innovation", allowing customers to access services at the times they wanted. Andy Burrows, of industry watchdog Postwatch, said a changing commercial environment had made it hard for post offices to fulfil their function. He stressed that customers need to be better served by postal services.
He said: "It should be a service that is geared to customer needs rather than to traditional ways of doing things and traditional opening hours."
He added that it was important post offices had the right range of products and services for their customers and that they were attractive places to go to.
The government announced at the end of 2006 that 2,500 of the country's 14,000 post offices were likely to close by the end of this year because of rising losses largely caused by fewer people using the network.The government announced at the end of 2006 that 2,500 of the country's 14,000 post offices were likely to close by the end of this year because of rising losses largely caused by fewer people using the network.
Critics say the closures will have a devastating effect on communities, particularly rural ones.Critics say the closures will have a devastating effect on communities, particularly rural ones.
Mr McFadden supported Essex's move but said it was up to councils to come to their own deal with the Post Office.
"If they are serious about it and are willing to put money in and they want to be answerable to their local council tax payers for that decision, then I would encourage Post Office Ltd to talk to them about that seriously."