One Expensive Post Office

I am normally strongly against Post Office closures as I think the closure of a Post Office can contribute to the isolation of communities and of individuals. We all have to recognise though that providing a Post Office costs money and the money has to come from somewhere.

I have recently obtained figures from the Royal Mail Group about the cost of running the Court Post Office at Buckingham Palace. The cost is paid for by Grants-in-Aid from Government Departments i.e. the tax payer.

The total cost for the year 2008-2009 was over £560,000. The postage cost was just under £255,000 while staffing costs exceeded £260,000, the remainder consisted of administration, travel and equipment costs. At a time when the public sector is looking to make savings and get the best value for the tax payer, it is amazing that the Court Post Office is still open. The postage cost would be similar whether or not the branch remained open but other costs would be drastically reduced. I estimate that the closure of the Royal Post Office could save the tax payer in the region of £260,000 to £300,000 a year.

Let’ put that saving into context, it would cost £180,000 to keep around 10 rural branches open at a cost of £18,000 per branch. Think of the difference that would make to those communities.

In March 2008, Pat McFadden said “the average cost to Post Office Ltd of post offices that are scheduled for closure is £18,000 per branch per year. If one is saved, therefore, the Post Office must find that saving somewhere else.”[1]

Pat McFadden was at the time the Minister of State for Employment Relations and Postal Affairs.[2]

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