Coronavirus update - 2 June 2020

Jun 2, 2020 |

NFSP

As you may be aware, Post Office Ltd (PO) is introducing major changes to the availability of bureau services across the network due to the impact of the coronavirus.

Due to domestic and international lockdowns, bureau sales have declined dramatically – as of last month, sales were only 3% of normal levels. PO has contacted HMRC for urgent discussion around PO’s fees (PO pays HMRC £300 per post office branch providing bureau services).

PO requested that licence fees be suspended until the coronavirus crisis is over and the market starts to pick up. However, HMRC would not agree to this and were only willing for payment to be deferred until December of this year.

PO have informed the NFSP that there are 3,500 offices that do not make enough income from bureau services over the year to cover HMRC’s fees (based on September 2018 to August 2019 data) - a cost of over £1m to the business. As a result, PO have de-registered these 3,500 branches, meaning they ceased to offer bureau services on 1 June 2020.

Additionally, there are a further 2,500 offices that had not conducted any bureau transactions at all in April 2020. As a result, these branches have had their registration with HMRC paused, effective from 1 June 2020.

Both groups of affected offices will continue to transact Travel Money Card sales and top-ups (as well as Travel Money online branch collections when this service resumes). If your branch is affected by these changes, PO should have written to you already, and your Area Manager should have contacted you as well (but you should contact your Area Manager if you are concerned that any of this applies to you or you have any questions).

The NFSP is in ongoing discussions with PO about the issue. We recognise the significant cost implications to PO - at what is already a very challenging time with transactions in general down due to the coronavirus – however, we want to ensure that subpostmasters have every opportunity to maximise their income.

Therefore, we have requested that the 3,500 offices that have had bureau services removed by PO can have a waiver in their contract to source their own supplier of currency. PO are considering our proposal.

We have also pressed PO to recognise that the current situation is dynamic and may rapidly evolve. We are beginning to see an easing of lockdowns here and abroad and we have requested flexibility in the decision-making on the future of the 2,500 branches where registration with HMRC has been paused. We want to ensure that as and when the market begins to pick up, those offices are enabled by PO to meet customer demand and ensure that Post Office remains the leader in the bureau market. PO are open to this and are considering the options. 

We will have detailed discussions with PO on this issue from w/c 15 June as more market data will be available at that point to help steer a decision.

Please be assured that we are working to represent members’ best interests and we welcome your thoughts and comments on these issues – please get in touch at communications@nfsp.org.uk

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