Friday, November 14, 2008

Victory on Post Office Card Account

I was delighted to learn that the government has renewed the Post Office's one billion pound contract to distribute benefits, and abandoning a plan to offer it to the private sector which might potentially have caused the closure of anther 3,000 local post office branches on top of the 2,500 the government closed this year.

Work and Pensions Secretary James Purnell told the House of Commons that he was dropping the procurement process that could have led to a private company winning the Post Office Card Account contract, and that he will allow the Post Office to carry on providing the service.

Conservatives and others have campaigned to keep the Post Office Card Account with Post Offices Limited, not least because this gives some real opportunities to enhance the capabilities of the card which would simultaneously help some of the most vulnerable members of society and reinforce the economic position of post office branches.

Two million people had signed a petition and 265 MPs from all parties signed a parliamentary motion calling for the contract to stay with the Post Office.

The new contract will now run from 2010, when the current contract runs out, until March 2015, with the possibility of an extension later.

It had been widely expected until recently that the contract would be awarded to the private company PayPoint and Purnell said his decision to keep the contract with the Post Office did not reflect on the service offered by other bidders.

The decision was warmly welcomed by the National Federation of SubPostmasters. George Thomson, its general secretary, said it was the correct decision of the post office network and for customers.

"The Post Office's bid was highly competitive, and provides customers with unrivalled geographical coverage, security and peace of mind, and a seamless transition from the current card account," he said.

"The alternative to today's news - the loss or the joint award of the contract - would have undoubtedly resulted in at least 3,000 unplanned post office closures."

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