Post Office's guilty secrets

Updated: 17:18 EST, 12 September 2009

When Labour came to power in 1997 it promised to end financial exclusion and bring banking services to everyone. Then it presided over the biggest ever closure of Post Office branches.

Now, as majority shareholder in Lloyds Banking Group, the Government seems content to allow it to shut hundreds of Halifax agencies, to the detriment of many communities, as revealed in The Mail on Sunday this month.

Banks have consistently refused to consider sharing initiatives where several different banks cut costs by operating from one place in a town or village. This is the solution proposed by Derek French, of the Campaign for Community Banking Services, which lobbies for banks to maintain a widespread branch presence.

Christine Simpson, 71,  visiting the mobile branch with grandson, Sam Clowsley, 16

Instead, banks - in common with the Post Office - have often opted for watered-down 'outreach' services, using temporary premises or mobile vans and offering limited facilities.

The Post Office seems almost embarrassed by its makeshift services and does little to publicise them. Earlier this year, watchdog Consumer Focus ordered the network to shake up its outreach operations to soften the blow of the 2,500 branches that have closed since 2007.

Financial Mail visited two rural Lincolnshire communities to ask users what they thought of these services, if they had found them:

BARKSTON

Even Miss Marple might struggle to uncover the outreach service in Barkston. For a start, the official Post Office website tells customers that it is open Monday to Friday from 9am to 3pm. In fact, it is open on Monday and Thursday from 9am to 3pm.

If that didn't put would-be customers off the scent, there is the top-secret location - past the derelict front of the former post office branch and down a culdesac. There are no signposts. The only clue is a 'Post Office Open' board in front of what looks like a Seventies semi-detached home.

But open the door and there is a community hall inside with a post office counter in the far corner.

Visiting postmistress Elaine Woods, 41, is chatting with retired postmaster and blacksmith Harry Jordan, 86, who has come in to collect his pension.

He says: 'If you didn't live here, you would never know about the post office, but this is a close-knit community and we share information by word of mouth.'

Another customer, Barbara Banks, 85, says: 'When the post office closed it was a desperately sad day and we will never recover the loss - it was the community's hub. But although I miss a proper post office, this visiting service provides a lifeline that means the elderly and disabled can still enjoy some independence.'

Farmer Julian Watson, 39, out with his dog, Poppy, says: 'This new limited service is OK if you remember when it is open, but it is not open enough. The real problem is the loss of post offices and this cannot be fixed without bringing them back.'

LITTLE STEEPING

Winding 40 miles north-east through beautiful countryside, passing East Kirkby - 'Home of the Lancaster Bomber' - we visit the village of Little Steeping, ten miles from Skegness. It is just past midday when a Post Office van comes down the lane and parks in front of the village shop. Until a year ago, the shop was also the post office.

The Coningsby subpostmaster, Martin Rich, who visits seven such communities by van a week, throws open the back door to reveal a miniature branch.

He says there was animosity when he first arrived, as the village felt betrayed by the closure. However, the anger has abated and he serves about half-a-dozen customers during each of the hourlong visits he makes twice a week.

Martin says: 'The main gripe I get now is why the van cannot stop in other villages where branches have closed down. They have a good point. I wish the Post Office would let us serve them, too.'

Barbara House, 68, the former village subpostmistress who still runs a small shop, accepts the mobile is better than nothing, but cannot understand why she lost her job. She also says the service does not always run smoothly and occasionally there are technical glitches when satellite links fail, halting payments.

Christine Simpson, 71, was visiting with grandson, Sam Clowsley, 16, to pick up her pension. He was posting a parcel.

She says: 'It is no substitute for having your own post office, but the van provides for most of our needs.'

Retired bank manager David Swann, 60, was using the service to deposit a cheque into his bank account. He says the post office's banking service - catering for customers of Lloyds TSB, Barclays, Alliance & Leicester, Nationwide and The Co-operative - means he does not have to drive miles to the nearest branch.

'We all value the visiting van for basic postal needs, but far too many people do not know about all the other services on offer,' he says. 'If the Post Office advertised these extras better, maybe it would make enough money not to be in its present mess.'

While the visiting services are welcome, there are not enough of them and David says: 'If this sticking-plaster solution for the collapse of the network is to succeed, why are not more communities being served by an outreach plan?'

WITH just 168 vans and about 600 'hosted services' such as in Barkston, the Post Office's outreach service has not compensated for the 2,500 branch closures since 2007.

Derek French, of the Campaign for Community Banking Services, which lobbies for the retention of banking services in small communities, wants the Government to bring the banks and the Post Office together.

French believes that the solution is to share branches where 'basic counter and related services are delivered to agreed standards on behalf of participating banks'.

The Post Office would also be involved.

He says the Government should use its ownership of banks (it owns 43 per cent of Lloyds Banking Group) to force the piloting of these shared facilities.

And French says: 'The Government should require the Post Office to engage with these pilots, as the Post Office is increasingly nudging into the banking sector.'