The Post Office has confirmed it will be axing 115 branches and hundreds of jobs in a major blow to Britain’s struggling high street.
The embattled postal giant said a significant number of jobs from its 1,000-strong head office staff were now at risk.
And 115 major city centre Crown Post Offices will be scrapped, in a move that critics fear could leave pensioners and the vulnerable isolated.
The news was broken by Post Office chairman Nigel Railton shortly after 9am today during a meeting with staff.
However, some furious front-line postal workers have told MailOnline they were left in the dark about the news, and claimed ‘no announcement’ had been made, in a move that was ‘extremely upsetting’ for staff.
The struggling firm is looking to offload the 115 most unprofitable sites from its 11,500-strong network.
The shake-up could see the branches transferred to retail partners or postmasters or shut for good.
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Pictured is a map showing where all the Post Offices now under threat of closure are based
The radical overhaul is part of the Post Office’s drive to transition to a fully franchised model – similar to how fast-food giant McDonald’s operates.
The model sees a company giving permission to individuals or groups to run the business, using its brand and products in exchange for a fee.
Almost all of the nation’s Post Office branches are now run as a franchise, with just one per cent directly overseen by the company.
News of the latest round of cuts could affect cities across the UK, with branches in London, Manchester, Edinburgh, Belfast, Bangor, Portsmouth, Sheffield, Sunderland and Birmingham among some set to potentially lose their Post Offices.
The company has recently come under intense scrutiny over the Horizon scandal, in which thousands of subpostmasters were accused of fraud due to faulty accounting software.
Some were jailed or forced to pay back thousands of pounds while others were ostracised by their communities for crimes they did not commit.
In June the bungling firm was slammed after it published the names and home addresses of more than 550 people wrongfully convicted during the Horizon fiasco in a staggering data breach.
Meanwhile, in September, sub-postmaster were still reporting unexplained problems with the flawed Horizon IT system in yet a further embarrassing gaffe.
Business minister Gareth Thomas said the Post Office is facing ‘commercial challenges’ and there needs to be ‘significant cultural change’.
Mr Thomas highlighted the ‘vital’ banking services provided by the Post Office and the importance of postmasters, adding in the Commons: ‘But we have to recognise that the Post Office is far from perfect.
Pictured is Cambridge city centre post office which is one of those now at risk
‘We have seen this from evidence given at the (Post Office Horizon IT) inquiry. It’s clear there needs to be significant cultural change at the Post Office to ensure it genuinely prioritises the needs of postmasters and delivers customers’ needs far into the future.
‘It’s also clear more needs to be done to rebuild trust within the business and with the public who depend on their services. It’s no secret too that the business is facing commercial challenges – nearly half of its branches are not profitable or only make a small profit from the Post Office business.
‘Postmaster pay hasn’t increased materially for a decade. The company has a high cost base and needs to transform its IT system.’
The number of Post Office branches has been steadily declining in recent years.
In the 1960s there were about 25,000 branches nationwide. Currently there are 11,500 in operation.
Post Office chairman Mr Railton said the latest shake-up will also offer a ‘new deal for postmasters’ by increasing their share of revenue and giving them a greater say in the running of the business as it looks to move on from the Horizon IT scandal that saw hundreds of subpostmasters wrongfully convicted.
The plans, which are subject to government funding, would see average branch pay doubled by 2030, with £120million in additional pay by the end of the first year.
Also at risk of closure is the Kingsland High Street branch in Dalston, north-east London
Making the announcement at the company’s headquarters in London on Wednesday, Mr Railton said: ‘The Post Office has a 360-year history of public service and today we want to secure that service for the future by learning from past mistakes and moving forward for the benefit of all postmasters.
‘We can, and will, restore pride in working for a business with a legacy of service, rather than one of scandal.’
He added the overhaul also ‘begins a new phase of partnership during which we will strengthen the postmaster voice in the day-to-day running and operations of the business, so they are represented from the frontline to the boardroom’.
It follows a strategic review launched by Mr Railton in May, but is reliant on funding talks with government, which the Post Office said were ‘positive and ongoing’.
The government is also said to have been consulted on the possibility of handing ownership of the network to thousands of subpostmasters across the country.
The 115 branches put at risk are are Crown Post Offices located in city centres and staffed by Post Office employees.
They are the only remaining branches directly owned by the Post Office, down from close to 400 in 2010.
Neil Brocklehurst, Post Office acting chief executive, insisted the plan was part of a ‘five-year journey that will set up the Post Office for years to come’.
He added: ‘There are many consumers who primarily shop online, but there also many who struggle to use online services or actively choose to shop on their local high street and who want to be served by a human being.
‘Postmasters across the UK serve every generation and this plan not only improves their incomes but also the support that we provide to let them run their businesses and serve their communities.’
Elliot Jacobs, serving postmaster and a non-executive director on the Post Office Board, said: ‘The last few years have been challenging for many retailers and postmasters are no exception.
‘We have faced cost pressures from rising energy prices, increased national minimum wage and national insurance contributions.
It’s vital that the Post Office embarks on this major transformation plan so that we have a sustainable financial future, and one that benefits the thousands of postmasters who work tirelessly day-in, day-out to support the local people and businesses who rely on us for essential everyday services.’
A spokesman for the Post Office added: ‘The plan intends to create a new operating model for the business that means ensuring the Post Office has the right organisational design.’
But the Communication Workers Union (CWU) union called on the Post Office to halt the plans and for the Government to intervene.
Post Office chairman, Nigel Railton, who revealed the news today
The news was broken earlier this morning
CWU general secretary Dave Ward said: ‘For the company to announce the closure of hundreds of Post Offices hot on the heels of the Horizon scandal is as tone deaf as it is immoral.
‘CWU members are victims of the Horizon scandal – and for them to now fear for their jobs ahead of Christmas is yet another cruel attack.’
But the Post Office insisted that aims are to franchise the branches or transfer ownership to other parties, such as its network of retail partners.
Retailers such as WH Smith, Tesco, Morrisons and the Co-Op operate around 2,000 Post Offices across the country.
The rest of the network – about 9,000 Post Offices – are operated by independent postmasters.
As part of the transformation, the Post Office is also setting up a new postmaster panel to increase support and training, as well as a consultative council ‘to ensure postmasters’ interests remain front and centre’.
A spokesperson for the Department for Business and Trade said: ‘Post Offices are an integral part of the communities they serve and the services they provide for local people.
‘The Government is in active discussion with Nigel Railton on his plans to put postmasters at the centre of the organisation and strengthen the Post Office network for its long-term future.’
A public inquiry remains ongoing into the Horizon IT scandal, which involved hundreds of subpostmasters who were wrongly convicted of stealing after the company’s defective accounting system made it appear as though money was missing from their branches.
