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2,500 more post offices to close 2,500 more post offices to close
(about 3 hours later)
About 2,500 post offices - a fifth of those left in the UK - are to close by 2009, the government has confirmed.About 2,500 post offices - a fifth of those left in the UK - are to close by 2009, the government has confirmed.
Trade Secretary Alistair Darling, ahead of making a Commons statement on the closures, said the current loss-making network was "unsustainable". Trade Secretary Alistair Darling said he wanted to guarantee "reasonable access" throughout the country but the current network was "unsustainable".
He said 4 million fewer customers were using post offices every week than two years ago and it was losing £4m a week.He said 4 million fewer customers were using post offices every week than two years ago and it was losing £4m a week.
Opposition parties say further closures will devastate local communities, particularly in rural areas.Opposition parties say further closures will devastate local communities, particularly in rural areas.
More than 4,000 post offices have shut in the past eight years.More than 4,000 post offices have shut in the past eight years.
The next round of closures "backed by £1.5bn investment from government" would contribute to a sustainable network, Mr Darling said. 'Changing lifestyles'
The network has been affected by the decision to pay pension and child benefit directly into bank accounts while TV licences, driving licences, passports and tax disks are now being supplied online and through other retailers. The next round of closures, with £1.7bn of investment from the government, would contribute to a sustainable network, Mr Darling told MPs.
I'm very clear about this - that we've got to have a national network of post offices Alistair DarlingTrade Secretary The network has been affected by new technology and "changing lifestyles," he said.
However, Mr Darling said the loss of that business was off-set by its reach into other areas - post offices were the largest provider of foreign currency and the third largest provider of travel insurance, while its saver accounts have over £1.8bn. The remaining post office network will still be larger than all the UK's banks and building societies put together Alistair DarlingTrade Secretary
"There will be other announcements soon that show that the post offices are determined to get more business and therefore more customers through the front door," he told BBC Radio 4's Today programme, but did not elaborate. Pension and child benefits can now be paid directly into bank accounts while TV licences, driving licences, passports and tax disks are now being supplied online and through other retailers.
"On top of that the parent company Royal Mail has been losing business and Royal Mail itself does need to make changes so that it can win new business in the future," he added. However, Mr Darling said the loss of that business was off-set by its reach into other areas. Post offices were the largest provider of foreign currency and the third largest provider of travel insurance, while its saver accounts have over £1.8bn in deposits.
"I believe there is a good future for both post office branches and the Royal Mail group itself provided we make the changes so they can compete effectively." He also announced that broadband will soon be offered by post offices with BT.
The closures "backed by £1.5bn from government" would contribute to a sustainable network. Future network
'Build on strengths' "Although the proposals I'm confirming today will lead to the closure of about 2,500 branches, the remaining post office network will still be larger than all the UK's banks and building societies put together.
"I'm very clear about this - that we've got to have a national network of post offices. If you went for a purely commercial network you'd be down to only about 4,000 and that makes no sense at all," Mr Darling said. "Because we want to maintain a national network, we're putting in place rules that will provide for reasonable access across the whole of the country.
"What I believe we can do is build on some of the strengths of the post offices."
HAVE YOUR SAY In my village, the post office is at the heart of the community providing a valuable service to all ages Jaxwalton Send us your commentsHAVE YOUR SAY In my village, the post office is at the heart of the community providing a valuable service to all ages Jaxwalton Send us your comments
Mr Darling is expected to publish the details of a consultation exercise into the proposed restructuring of the post office system. "And we will give Post Office Limited the ability to shape the network for the future with clearly defined access criteria to ensure that the right post offices are in the right place to maximise their business."
It is believed he will order a series of "local area reviews" during the next 18 months in 60 areas, each covering several constituencies. He said there will be a series of "local area reviews" during the next 18 months in 60 areas, each covering several constituencies.
There have been 2,500 responses from pressure groups and members of the public since the consultation process was ordered in December last year. There will also be 500 "outreach locations" set up in small remote communities, in community centres, village halls, pubs and even people's homes.
Call for better strategy Network 'decimated'
The Conservatives say the government has failed to have a long-term vision for the system. There have been 2,500 responses from pressure groups and individuals since the consultation process was ordered in December last year.
Tory post office spokesman Charles Hendry said: "What the government should be doing is having a totally different strategy. Shadow Industry Secretary Alan Duncan said the proposals confirmed many people's worst fears about the future of the post office network. "I'm afraid this statement confirms many people's worst fears that our Post Office network is about to be decimated.
"It shouldn't just be looking to see how it can just manage the decline of this vital service. It should be creating new business opportunities so the post offices survive on their business - which is what they all want - rather than having to survive on subsidy." "This government already holds the record for closing Post Offices faster than any other and today's announcement amounts to an acceleration of that rate of closure, shutting a further 2,500 branches over the next two years.
"By the time of the next election this government will have closed over one third of the entire Post Office network."
Liberal Democrat trade spokeswoman Susan Kramer said the closures would be a "death knell" for many communities.Liberal Democrat trade spokeswoman Susan Kramer said the closures would be a "death knell" for many communities.
"The government sees only a business in inevitable decline. Its plan is designed purely to save money and has nothing to do with meeting the long-term needs of people who rely on post offices for essential services.""The government sees only a business in inevitable decline. Its plan is designed purely to save money and has nothing to do with meeting the long-term needs of people who rely on post offices for essential services."