I recently tabled a parliamentary question to the Minister in relation to the business plan for An Post. In his reply, the Minister said that it was Government policy that An Post remain a strong and viable company in a position to provide a high quality postal service and maintain a nationwide customer focused network of post offices. The reply goes on to state that the board of An Post is required to approve a rolling five-year business and financial plan each year in accordance with the code of practice for the governance of State bodies. I am a little disappointed that the current five-year plan which will soon expire has resulted in the downgrading of many post offices and the closure of others.
The reply goes on to state that the company has begun work on its plan for 2015 to 2019 and that the Department will be engaging with the company over the coming weeks as the plan is being finalised. I would like the Minister to say that, in the context of finalisation of that plan, every effort will be made to support post offices. In recent weeks, I learned that Cappataggle post office, County Galway, will be closing on 31 December this year. The reply continues that a whole of government review of the scope for providing additional public services through local post offices is currently under way under the auspices of the Cabinet committee on social policy and that An Post is aware that this review is ongoing and engagement with the company is being undertaken when and as appropriate.
I was disappointed to read in yesterday’s Irish Independent about proposed wage cuts for postmasters. The relevant article, under the headline, “Postmasters being forced to take pay cut of up to €30,000”, refers to wage cuts of between €4,000 and €30,000, depending on the level of social welfare business generated by each post office. This is something about which I have not heard heretofore. I have never heard of a postmaster being paid on the basis of the amount of business generated. This news has stunned postmasters, many of whom have expressed fears for the future of their businesses. Administration of social welfare payments is a crucial form of income for postmasters and an important service for post offices. The Minister will be aware that earlier this year a Grant Thornton report, commissioned on behalf of the Irish Postmasters’ Union, warned that the loss the social welfare contract by An Post would result in the closure of more than 500 post offices. It is a fresh blow to the future of the network if, as announced, these cuts are to be imposed. This will put huge pressure on businesses already facing enormous challenges in terms of remaining open and will also result in smaller post offices losing out on several thousand euros per year.
We recently learned of the closure of Cratloe post office, County Clare, in addition to the closure of Cappataggle post office, which will impact hugely on people living in rural areas. I know the Minister has already met with the Irish Postmasters’ Union. I hope that he will agree to meet An Post and that he can provide me with more information on the business plan for the next five years. It is hoped this plan will propose new business for post offices such that we are not always hearing about the closure of post offices.
Minister for Communications, Energy and Natural Resources (Deputy Alex White): I thank the Deputy for raising this important issue.
I would like to reassure the Deputy that the Government is committed to a strong and viable An Post and supports the maintenance of the maximum number of economically viable post offices providing high quality services on a nationwide basis. As stated by Deputy Kitt, the board of An Post is required to approve rolling five-year business and financial plans each year in accordance with the code of practice for the governance of State bodies. I understand that the company has begun work on the plan for 2015 to 2019 and my Department will be engaging with the company over the coming weeks as this plan is being finalised.
In relation to the post office network and decisions relating to the opening and closing of post offices, this is an operational matter for the board and management of An Post and not one in which I have a statutory function. The future of the post office network, including post offices located in County Galway, will only be secured by it continuing to provide services that large numbers of people and business users need and are sustainable in the long term. The post office network needs to develop so that it can meet the challenges it is facing in urban and rural Ireland over the medium term. In urban Ireland, increased broadband penetration, reduced mail volumes and the availability of alternative payment services is reducing post office business.
In much of rural Ireland, commercial business is moving away from smaller towns towards larger urban centres. This is marginalising the rural economy, drawing employment away from the countryside and reducing the level of economic services, including banking and retail, available outside regional centres. It has been necessary to undertake a whole-of-Government review of the scope for providing additional public services through local post offices. This review has been under way for some time under the auspices of the Cabinet committee on social policy. An Post and the Irish Postmasters’ Union are aware that this review is ongoing and are receptive to exploring avenues for securing new lines of business for the network. I have met An Post and the IPU in relation to these matters.
I understand the concern of the Deputy and other Deputies about the future of An Post and the post office network. An Post is currently facing many challenges not alone financially, but also from the development of Internet-based communications technologies. Any decisions it may take must be considered in the context of maintaining a sustainable post office network. As shareholder, I have a concern regarding the ongoing commercial position of the company and I regularly liaise with the company in this regard. I acknowledge the pivotal role that post offices play in local communities, urban and rural, in both financial and social terms.
There is a strong future for the company and the post office network by leveraging its existing strengths to remain a significant player in the provision of Government, financial and other services. Securing the future viability of the post office network in the longer term will entail the network continuing to modernise and diversify, as it is doing, to provide services that its customers require. It has been long-standing policy that An Post remains in a position to compete in a liberalised market and to continue to provide wide-ranging services to both urban and rural communities.
Deputy Michael P. Kitt: I would like if the Minister would address the issue of new services for post offices. I recently saw a document which shows that post offices provide up to 28 different services. The provision of 28 different services in rural Ireland is good. It is important that the post offices providing these services are maintained. It is hoped that the driving licence service, which is proving very confusing, particularly in the west, could be provided by post offices. Motor tax and utility bill payments are other important services which could be provided by post offices. I hope this will be the case. As I said, it is important consideration is given to the provision of new services by post offices.
I have received a document from Post Office Users, a new organisation set up in County Galway, that refers to upwards of ten offices in the greater Ballinasloe area, which is only one post office area, having been either closed or downgraded. An Post proposes to add the closure of Cappataggle post office to that list. I am disappointed at that proposal.
When the post office in Killoran closed, people were told they could go to Cappataggle but now they have been told that is to close and they must go to New Inn or Kilconnell. It does not make sense that one post office after another is being closed. I hope this organisation will get a hearing from the Oireachtas committee and that the Minister will meet An Post to tell it what exactly the situation is on the ground.
I raised the issue of Cappataggle with the former Minister, Deputy Pat Rabbitte, last July. He said, “I would not throw in the towel on Cappataggle, known for its production of hurlers.” He is absolutely right in regard to hurlers who are the Connacht champions. I am not throwing in the towel nor are the people of Cappataggle. I hope this decision will be reversed.
Deputy Alex White: I thank Deputy Kitt for his additional comments on this very important matter. I share the Deputy’s views about the importance of the post office network and the affection with which it is regarded, especially by small communities in provincial and rural areas. I assure the Deputy that An Post will continue in its endeavours to retain and obtain business opportunities for the network, having due regard to competition and public procurement requirements, as appropriate. I am due to meet An Post tomorrow afternoon and the issues the Deputy raised will form part of the agenda for my discussions with it.
The post office network needs to attract business but that business and activity must have real substance to it. It cannot be contrived. I want to see Departments participating in this, as they have done, and other agencies of the State participating as well. I also want to see An Post and the post office network reaching out for new commercial opportunities so that they can attract business. That is the critical aspect of this. They can pull in business from the private commercial sector as well as from the public sector, Departments and other agencies, to which the Deputy referred. These are important matters.
An Post has advised me that there are approximately 90 post offices in County Galway. There have been a number of changes in recent months, to which the Deputy referred. There are risks, worries and concerns but relatively few post offices have closed since this Government came into office three and a half years ago. A great deal more closures took place in the period of time prior to that but we are doing our best, working with the Deputy, to ensure this issue is brought forward in a satisfactory way.