Derbyshire rural postmasters may lose retirement cash in Post Office ultimatum

The Post Offices in Crich, Eyam and Hartington are among around 130 branches nationwide which are now classed as ‘hard to place’, meaning that no new postmasters have been found to take over the business from current operators who are now nearing the end of their careers.

Phil Dolby, 68, who has run the Crich branch for 38 years alongside his now ex-wife Karen Woodward, said: “Basically we’ve been carrying on for a while now just because we don’t want the village to lose its Post Office.

“In a small community that starts a domino effect. We’re one of the busiest Post Offices in the area and it would be a great loss to the village. The money we bring in goes around all the other shops, and if we were to close then they all suffer. So we’re very reluctant to walk away and we haven’t got many other options.”

More than 7,900 branches have been modernised – relocated, handed over or moved on to new contractual arrangements – under the Post Office Network Transformation Programme (NTP) in recent years, but the three postmasters in question opted out of the programme to ensure the viability of their businesses until they were ready to retire.

Phil said: “The Post Office was struggling and decided it had to cut its losses, it produced a new contract and got as many branches as possible transferred into supermarkets or other big stores.

“The old one was never going to make us rich, but it was good and fair. The new contract would pay slightly more for every transaction we carried out, but there would be no contribution at all to the running of our buildings.

“I chose not to take it on as it would have meant a huge drop in salary. I opted out of the process and stuck with the original contract, even though they applied considerable pressure.”

As part of a deal agreed in 2015, with Government involvement, the postmasters were due to receive compensation worth 26 months’ of their usual remuneration if they signed a conditional resignation form, enabling them to leave the network once a new subpostmaster was found – a search which has yielded no positive results.

Sue Bruce, 69, who has been running the Hartington branch from her tea rooms for the past 20 years, said: “It wasn’t a very nice day, having someone stood over you while you signed this agreement.

“They came and looked around the other village businesses, asking if anyone was interested in taking on the Post Office. The money they were offering at first was disgusting. For what you have to do, it was not very fair.”

Left in that state of limbo, and with the NTP officially ending in the Post Office has now written to the 130 postmasters, changing the terms of the offer and giving them six months to make up their minds.

The company has offered three choices: to continue trading on their existing contracts, leave the network now or switch to the new contract – with the last two options coming with a lump sum compensation of 12 months’ remuneration.

Only those postmasters able to find a replacement to take on the business before September will now receive the 26-month exit payment, an unlikely outcome given the situation so far.

Sue said: “They put money away to pay us all compensation, and I don’t know where that’s gone now. Some colleagues in the programme received considerably more than we’re now being offered. To close the door like this seems immoral.

“In September, I’ll probably stay on my old contract and lose what’s owed to me. I’ve been thinking about retirement for a few years but I think so much of my village neighbours, I don’t want to let them down by shutting the Post Office.”

She added: “It’s a horrible position to be in. I’ve lived here all my life, it’s a big commitment but I am getting older. I’m alright for the moment, but there will come a time to finish up.”

While neither Phil nor Sue was completely reliant on the compensation for their costs in retirement, both say it would be the difference between a comfortable lifestyle and more challenging years ahead.

Phil said: “We invested a lot to buy the business in the first place and you always hope you’ll get that back when you sell up, but anyone who took over now would go on to the new contract, which makes it impossible to sell. With stamp sales down, National Savings pulling out and things like online tax discs, the salary is decreasing all the time. It’s an unattractive proposition for buyers.

“A couple of years ago they said ‘hard to replace’ Post Offices could retain the old contract, but in my case they don’t want to honour that. They gave us the option of selling the building to them, but this is also our house and we don’t want to move.

“We had talks with someone willing to move the branch to his shop using my contract, but because the business isn’t worth a great deal, I would get nothing like the compensation the Post Office was going to pay. It basically means writing off the value of the business when we retire.

He added: “Postmasters are all self-employed business owners so there’s no company pension. The 26-month payment was a nice nest egg, and was meant to be recognition for our years of service.

“The Post Office says it doesn’t close branches and, in one sense, that’s true. We could keep working until we drop, but would like a bit of spare time while we’re fit and healthy.”

That National Federation of Subpostmasters (NFSP) – an organisation representing the profession but which is funded by the Post Office – has called a meeting of all those affected on Tuesday, April 25, to discuss the situation and move towards a collective response.

NFSP chief executive Calum Greenhow has said: “Post Office are willing to treat postmasters today in the same manner in which they treated them throughout the Horizon scandal.”

“Government consistently state that they have provided funding to the Post Office of £2.4billion via the NT process, which should have included ring-fenced funds to allow all those colleagues from 2015 to exit the network with 26 months Leavers Payment. Our question remains, what has happened to that ring-fenced money?” 

A Post Office spokesperson said: “Following a programme that first started over a decade ago, there are around 130 Post Offices, out of a network of over 11,500 branches today, that constitute a hard to place branch.

“Under the programme’s arrangements, agreed with the Government of the time, Postmasters who wanted to leave the network were only entitled to an exit payment if and when a replacement branch was found.

“We have provided these postmasters with three different options to consider and they have six months to tell us how they would like to proceed. We have dedicated colleagues able to support and provide advice on their options.

“We fully recognise that for these postmasters this is a difficult time, but with limited funds we need to ensure we prioritise maintaining access in the areas our communities and customers need it most.”

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