‘Stop Urban Post Office Closures’

Demonstration outside Mill Hill Post Office in north London last February
Demonstration outside Mill Hill Post Office in north London last February

A new report, The last post, released on Monday, provides new evidence of the vital social and economic role of urban sub post offices. 

The report, commissioned by Manchester City Council after 20 post offices were closed in the Manchester metropolitan area last year, says that they play a particularly valuable role in deprived urban areas.

It also outlines the new threats that they now face from changes to the post office network.

Much attention has been focused on rural areas, yet the contribution post offices make to urban areas has been overlooked. In fact, post offices in urban areas have borne the brunt of recent closures:

• Over the past two years, more than eight urban post offices have closed for every rural post office closure.

• More worryingly still, more than one in six of the urban post office closures took place in deprived areas.

Evidence from the Trade and Industry Select Committee released last month showed that subpostmasters in urban areas are also under greatest threat from withdrawal of the Post Office Card Account in 2010.

The Account is currently worth £403 a month to subpostmasters in urban deprived areas compared with a national average of £249.

Report author, the New Economics Foundation (NEF) believes that this lost income could prove to be the ‘tipping point’ at which many post offices in urban deprived areas are simply no longer viable.

New analysis from NEF of post offices in the Manchester metropolitan area shows the significant knock-on impacts of post office closures for local businesses, service providers (such as schools), community groups, the local economy, and for local people – particularly the most vulnerable.

Councillor Jim Battle, deputy leader of Manchester City Council says: ‘This report shows quite clearly the huge contribution post offices make to the local economy as well as the social fabric of some of our most disadvantaged communities.

‘It also proves the devastating impact post office closures are having on the local businesses in their vicinity and on the most vulnerable groups in our community.’

NEF’s Local Multiplier analysis applied to post offices in Manchester reveals that:

• For every £10 earned in income, the post office generates £16.20 for its local economy – including £6.20 in direct spending on local goods and services.

• Based on in-depth analysis of Manchester post offices, this means that each post office contributes in the region of £310,000 to the local economy each year, of which £120,000 is direct spending on local goods and services.

• In addition, nef’s analysis reveals that each post office saves small businesses in their direct vicinity in the region of £270,000 each year. 

Further in-depth analysis of the impact of Post Office closures in Manchester on small businesses reveals:

• Sixty per cent of local businesses witnessed significant impacts, either to their business, to their clients and/or customers, or to the area in general following the closure of the local post office.

• Local businesses also reported difficulties in making cash deposits and other banking issues; extra costs in staff time to visit post offices further away; and longer queues at alternative post offices resulting from customer displacement.

• Local trade associations noted the knock-on impact of reduced footfall on shops located in the vicinity of the closed post office, with the businesses themselves reporting significant loss of custom.

nef senior researcher Guy Rubin says: ‘In urban areas post office closures deal a double blow as they are not only an anchor for the local community, but also for local enterprise.

‘Their closure can trigger a “tipping point” leading to a downward cycle that leaves ghost communities with very few shops and services left.’

NEF warns: ‘The danger is that when amenities like the post office or banking facilities disappear from a community, the financially mobile are more likely to leave, leaving higher concentrations of deprivation, which can in turn lead to further loss of amenities.’

The last post highlights the unique social value of post offices – the sheer diversity and range of services provided distinguishes them from other retailers.

The post office is also highly valued and trusted compared to other retailers in disadvantaged communities.

nef’s analysis of the social value of urban post offices reveals:

• Seventy-six per cent of people surveyed by nef and Manchester City Council said that they would be affected by the closure of their local post office.

• Groups affected by post office closures also included schools, the University, credit unions and community groups.

• Fifty-three per cent of post office users said that it was difficult logistically and financially to travel to post offices further away.

l Fifty per cent of local people surveyed in the vicinity of just one of the closed post offices in Manchester (Gladeside) buy groceries elsewhere as a direct result of the Post Office closure – with significant implications for local traders.

• Qualitative evidence from nef’s survey emphasises the vital and overlooked social services role played by Post Offices. This evidence supports previous research which found that half of the subpostmasters in disadvantaged areas keep an eye out for between 20 and 50 vulnerable customers.

nef’s analysis of the social and economic value of post offices in Manchester adds to growing calls for a full economic and social analysis of the network as a whole.  The report also suggests ways in which local authorities can provide a leadership role by:

• Analysing the impact of their own spending on the sustainability of Post Offices – for example payments of benefits, receipt of council tax and bulk mailing contracts.

• Taking a leading role in working with the Postal Services industry and engaging other key stakeholders such as Primary Care Trusts, to examine how to sustain postal services for residents in deprived communities.

• Taking full account of the value of Post Offices to their neighbourhoods when developing regeneration plans.

But, the report says, local authorities alone cannot safeguard the future of the post office network.

The government must take significant steps to safeguard the vital role that both rural and urban post offices play at the heart of communities across the UK.

Critically, the decision to withdraw the Post Office Card Account should be reviewed in the light of new findings of the potentially devastating impact its withdrawal will have for post offices in urban deprived areas.

It is clear, the research concludes, that any decision on the future of the post office network must take an integrated approached to the survival of the network in both rural and urban areas.