Post Office announces remuneration improvements and a one-off cost of living payment to help support Postmasters

• Post Office Chief Executive announced a one-off payment and a package of remuneration improvements to help support Postmasters during the cost of living crisis at a Postmaster conference held last night
• Postmasters were also briefed by Post Office Chief Executive Nick Read and Chief Operating Officer Martin Roberts on practical support for Postmasters during first Royal Mail strikes in over a decade
• Announcement follows Postmaster conference earlier this year where branch profitability was confirmed as the number one priority for Post Office and comes after significant support package provided during Covid-19 period

Post Office Chief Executive Nick Read has announced a one-off payment and a package of remuneration improvements to help support Postmasters during the cost of living crisis.

At a Postmaster conference held last night (23 August), Nick Read announced that Post Office will:

• Pay Postmasters a one-off lump sum in September worth 7% of their Mails and Travel Money remuneration based on the five months of trading already this financial year.
• Double the per transaction payment for banking deposits; and will also pay Postmasters for balance enquiries and failed banking transactions.
• Double the payment Postmasters receive for all Payout transactions for the rest of the financial year, backdated to 1 April 2022, meaning Postmasters receive a full year’s worth of this 100% uplift.

These changes, in addition to other improvements in Banking and Mails outlined at the conference, take effect from September trading. This follows a commitment from Post Office at its last conference in May to prioritize improving branch profitability.

The conference last night also provided Post Office with an opportunity to set out what practical support will be available to Postmasters ahead of the first Royal Mail strikes in over a decade. The first strike date is Friday 26 August.

Nick Read, Chief Executive at the Post Office, said:

“Over the last few months, we have been working hard on a package of costed measures to boost Postmaster remuneration. Everyone is facing very real challenges in this trading environment. No sector is immune. Inflation, business rates, rises in the national minimum wage and national insurance are all contributing to a cost spike that is unprecedented - and most of these costs are outside our immediate control. We have developed a package of remuneration improvements and some operational changes based on issues that Postmasters have asked us to address - and get more money to them as quickly as possible.”

At the conference, Nick Read reaffirmed Post Office’s commitment to usher in a new culture of genuine partnership with Postmasters, with some form of shared monetary incentive underpinning it, first outlined in a speech in April 2021 to Postmasters.

Nick Read said last night:

“When I arrived a little under three years ago, I found a business in need of significant and urgent repair. From needing to make redress for the failings of the past, to securing much needed investment. In particular to improve our systems and processes to support Postmasters, our most important asset, as well as to open up new commercial opportunities if we are to succeed together in the short, medium and longer term.”

During the Covid-19 period, Post Office provided significant financial support package for Postmasters. This included:

• All independent postmasters receiving 100% of their remuneration in April 2020 and 90% in May 2020. The guarantee covered both their fixed and variable remuneration.
• Postmasters benefitting from a 15% top-up of their variable remuneration in June 2020.
• The establishment of a hardship payment application for Postmasters that struggled or were unable to open during the Covid-19 pandemic.
• A Travel Support Scheme in summer 2021 for branches that were impacted by the then travel uncertainty as a result of the Covid-19 pandemic.

Since the start of the financial year, Post Office has already introduced other measures to improve branch profitability, including:

• With the second Mails Distribution Agreement, volume-based payments such as home shopping returns have increased by 5.4%;
• Royal Mail price increases are flowing to Postmasters on 80% of our mails volumes;
• And passport rates have increased to £5 for simple transactions and £7 for others.