A month and a half ago, I blogged about the importance to the future of the Post Office network of the Government decision on the award of a contract to run a successor product to the current Post Office Card Account - the so-called POCA 2. The Government announced its decision yesterday and the contract has been retained by the Post Office. This is the right decision and good news for consumers - especially vulnerable consumers.
But it's surprising how little publicity this decision has obtained. For instance, the "Guardian" has a shortish piece on page 6. The "Daily Mirror" - which has campaigned on the subject - puts the story on pages 8-9. Why am I surprised by this?
First, the decision is of enormous importance to the future of the post office network. The closure of some 2,500 offices has attracted enormous amounts of publicity and protest, but the 'saving' of a similar number seems to be regarded as a relatively minor matter. I suppose the media prefer bad news to good news.
Second, the decision should have been made months ago, certainly before Parliament went into its summer recess. For months, Ministers have allowed stories to run suggesting that the contract would go to PayPoint. The long delay and uncertainty has been very damaging to the business prospects of sub-postmasters and to the political standing of the Government.
Third, the decision has finally been made by abandoning the tendering process that has been running for two years which begs the question of why Ministers started this process in the first place. We are told that the legal advice to Government has changed but this raises other questions about whether the original legal advice was sound and whether political decisions should be so beholden to changing legal advice.
This is not the end of the story.
First, the Government's decision might be challenged. PayPoint may seek judicial review and the two sets of legal advice to Government may have to be made public. Even if there is no legal challenge, one presumes that rival bidders will be entitled to compensation and the taxpayer is entitled to know the costs of this whole process.
Second, the award of the POCA 2 contract to the Post Office does not guarantee the maintenance of the present network of some 11,500. It merely avoids another major swath of closures. Post Office Limited and Government have to develop new profitable revenue streams and not simply save current ones. A couple of years ago, the Government set up an inter-departmental Cabinet Committee called Misc 33 to look at the right size of a sustainable network and a new, more far-reaching effort of that kind is now needed.
