The people who run post offices could “walk away” from their jobs as government cuts mean they won’t earn a liveable wage, it has been claimed.
The UK Government has given the contract for the benefits cheque service, known as green giros or the exceptions service, to rival firm PayPoint, a move that has caused outrage among sub-postmasters.
The National Federation of Sub Postmasters executive council officer for Scotland Andrew Gilhooly said some members were giving up their jobs, as withdrawing the service means too little cash coming in.
Now Dundee’s depute lord provost has said he is anxious about the future of smaller outlets in the city.
Ian Borthwick, also a Strathmartine area councillor, said, “I’ve had expressions of concern about how this will impact on smaller post offices. I’ve got three post offices in the area and I am obviously concerned about the protection of smaller post offices.
“It’s not just that they lose the money (from the contract), it’s the footfall of people coming into the shop.”
The green giro contract, which allows 350,000 people to receive pensions and benefit payments by cashing a cheque at their local post office each week, has been with the Post Office since it started 43 years ago.
It is worth £20 million a year and Mr Gilhooly said more contracts needed to come the company’s way if outlets are to survive. He also disputed a government claim there won’t be a reduction in the Post Office network, currently made up of 11,500 outlets.
“A lot of sub-postmasters can’t afford to survive because salaries are dropping,” said Mr Gilhooly.
“Footfall drops when you lose services and that affects the retail side of things.
“There will be closures on a natural basis as post masters walk away. It’s all very well saying there will be no closures but actions speak louder than words and they have to give us the work.”
A spokeswoman for the DWP said, “The government remains committed to a sustainable future for the Post Office network and has allocated £1.34 billion of funding to the network over the next four years.
“Maintaining a network of at least 11,500 branches, and continuing to meet the existing access criteria, is a condition of this funding.”
A Post Office spokeswoman said, “Whilst Post Office is disappointed not to have been awarded the ‘Simple Money Transmission Services’ (SMoTS) contract, we are pleased that the Department for Work and Pensions has outlined new plans for working closely with us in the future, including three pilot schemes, universal credit reforms and strengthening links with credit unions.”