Gale's View - Post Office Card Account (November 19th 2008)
Last week the Secretary of State for Work and Pensions announced that the Government had back-tracked on its proposal to remove the Post Office Card Account business from Post Office Limited. In a Commons statement the Minister said that he had "decided to cancel the current unfinished procurement exercise and to award a new contract for the continuation of the Post Office Card Account directly to Post Office Ltd." until 2015 and with the possibility of a further extension. In a constituency like North Thanet this decision matters a great deal to very many people.
The population of Margate, Herne Bay and the Villages contains well over 30% of people over retirement age, which is double the national average. There are, additionally, significant numbers of younger but disabled people and an equally significant number of people suffering social deprivation. Many of the people that I represent do not have, do not want or cannot obtain bank accounts but at the same time are in receipt of a variety of benefits. For those people the Post Office Card Account, grudgingly introduced when the government abolished benefit payment books, is the only means by which they can access their funds.
That access is, in turn, dependent upon a diminishing number of sub post offices that has dwindled with the removal of government services, the facility to pay the television license fee through the post office and on-line purchase of car tax discs. For many of these independent small businesses the loss of work and the accompanying payment has made the difference between survival and financial ruin and it is not surprising that many sub postmasters have chosen to take offered compensation and close rather than risk bankruptcy.
In Thanet we have lost a number of outlets following the "network reinvention" and other programmes of closure and as a result a number of individual communities and most notably the entire population of Minnis Bay have been left without their dedicated local sub post offices and with the need to travel a considerable distance, often in inclement weather, on foot and, in the case of Minnis Bay, up a long steep incline to Station Road Birchington in order to access services.
To the Government's surprise and in spite of both poor advertising and difficulty in obtaining details and forms, some 3.8 million people are currently using the Post Office Card Account and Ministers acknowledge that "we are opening 12,500 POCAs every month". Each POCA customer makes, on average, seven visits a month to the sub post office and spends, on retail goods bought in the post office shop, £6 on each visit. POCA payments bring in about £400 per month which is about 12% of the postmaster's net pay.
The Post Office Card Account is liked because it is convenient, because it is local and because it is trusted in a way that, particularly in the current climate, bank accounts are not. It is also, in a sea of failed government information technology projects that includes the disastrous CSA and Tax credit computers, the one shining example of a system that works efficiently.
A decision was supposed to have been taken about the future of what has become known as "POCA 2" early in 2008 .Months of dithering have meant that the Governments belated but welcome announcement will have come too late for some small businessmen who have already opted for closure and retirement. Nevertheless, it looks as though pressure from back-bench Members of Parliament of all parties (including many Government MPs representing marginal seats!) in a very recent debate, coupled with well-orchestrated organisations such as Help the Aged, have at least for the moment secured the future of some 3000 sub post offices that would otherwise have gone out of business. In welter of gloomy news headlines let us welcome this reprieve. I shall now open a Post Office Card account myself and I would encourage as many of my friends, acquaintances and constituents as possible to do likewise. "Use it or lose it" is once again the order of the day.