The annual conference of the Irish Postmasters' Union (IPU) over the weekend heard some gloomy forecasts for the future of the post office network. The IPU were told that the network's very existence is under threat especially if an increasing number of social welfare payments are lost to the banks. The Government, delegates said, is not committed to safeguarding the network.
An Post last year earned profits of €6.5 million but it is still seeking up to 1,500 redundancies. The profits, although they represent a huge improvement on the losses suffered in 2003, are still very modest for a company with annual turnover of €750 million.
The chief executive, Mr Donal Curtin, warned that the company "is not out of the woods yet". This is something of an understatement. Last year, mail volumes declined by 1.3 per cent despite the economy expanding by 5 per cent and an additional 80,000 delivery points coming on stream due mainly to the housing boom. Mail volumes were also down in 2003. People are using An Post's services less or not at all.
The increasing use of electronic funds transfer (EFT) for social welfare payments, which allows them to be sent direct to bank accounts, means that the post office network is becoming less viable. The Minister for the Communications, Mr Dempsey, told the IPU that 65 per cent of new social welfare recipients are opting for EFT. This is a development that the Department of Social Welfare is happy with because the cost per transaction is five cent compared with €1.24 for payment through the post office. On the other hand, this development alarms the network staff because social welfare payments account for nearly half of An Post's retail business.
There is, clearly, a compelling case for An Post to reduce operating costs. It is not just a question of reducing, by voluntary means, the number employed but also the amount of overtime worked. The company had some success on both fronts in 2004 but the modest profitability suggests that more needs to be done. An Post's workforce will have to accept that changes in work practices are vital if the company is to have a viable business.
The future of the network is of great consequence, especially in rural areas. EFT in post offices must be made available immediately as well as any other measure which would generate new business. Last year, yet again, the 1,350 postmasters and postmistresses - who are paid far less than the average industrial wage - had to forgo a pay increase. The company and the Government are risking mass resignations from a workforce which still brings practical as well as symbolic value to the State.