SUPPORTING YOUR RURAL POST OFFICE

As from April 1^st 2003 a practice that has lasted for over fifty years came to an end. From that date the delivery of all benefits started to be paid through a bank account. The habit of going once a week to the post office to collect one’s pension or child benefit, in fact any benefit, will be phased out over two years. The ending of what has been a core business for your local post office brings fears of perhaps more closures across rural Somerset. However there are opportunities within the scheme for you to help increase business for your local postmaster, thus making your local office more viable.

 

You now have three options available in order to receive your benefits. 

Commercial bank account. At present there are five commercial banks whose current accounts can be accessed at the post office.

Basic Bank account. A basic bank account is one that does not provide a chequebook or overdraft facilities but allows for direct debits to be paid and money to be accessed at your local post office. At present ten banks have agreed to provide this facility: - Abbey National; Alliance and Leicester; Barclays; Co-Operative Bank; Halifax Bank of Scotland; HSBC; Lloyds TSB; National Australia Group comprising Yorkshire Bank, Clydesdale Bank and Northern Bank; Nationwide Building Society; Royal Bank of Scotland including NatWest and the Ulster Bank.

Post Office card account. A Post Office card account receives the benefit weekly. This money can only be drawn at the post office. You will need to remember a PIN number to access the money and you cannot overdraw.

So what must you do to help rural post offices?  If you wish to have the money paid into a bank account make sure it is one that can be used at the post office, and draw money out at that office as regularly as you are able. Each time you withdraw money a payment is made to the postmaster. 

If you feel that a simple Post Office card account is the answer for you there is another way income can be increased for the office. At present all benefit payments by order book are paid on a certain day and the total amount is paid, the postmaster only receiving one payment for the transaction. With the card account the full amount is paid in to you each week, however you do not have to draw all the money out. 

On Friday 21^st November 2003 a questionnaire was sent to all of Somerset’s 149 rural post offices. Part of my project as Social Inclusion Worker for the Community Council for Somerset is to monitor the changes the Government is making to the Benefits payment system and the move to Direct Payment. Of particular interest is the effect it has had on vulnerable benefit recipients living in rural Somerset and on the continuing viability for the Post Offices situated in these villages.

Within a week there was a 70% response, very high for a survey, reflecting the concern that sub postmaster’s have regarding their future and the treatment of their valued customers. The following is a brief analysis of the findings.

46% had traded for over ten years.

Over 80% reported that they had lost business due to the introduction of Direct Payment. For those who had been in business for longer than five years this rises to 88%.

More than 60% were critical of the role played by the Department of Work and Pensions (DWP) in the changeover many of the criticisms were quite scathing. The following quotes are just a few of those from the sub postmasters;

“ The DWP’s role has left many worried and confused and the more vulnerable have been grateful for my help.”

“Most have been utterly confused by unnecessary procedure of DWP. One thing is certain the most elderly and vulnerable will suffer from losing local contact and advice from their Post Office staff if they elect to transfer to their bank.”

“The role of the DWP has been very misleading to my customers”

“The role of the DWP has had a negative effect. I believe the viability of many rural sub Post Offices to be under threat. In my opinion within the next ten years many will be increasingly non viable and will disappear.”

“The DWP is confusing them and giving the impression that they must use a bank”

“With regards to the DWP absolute bullies particularly of the elderly. They have embarked on sending people out to waverers in order to convert them to the Bank. They still do not cover Post Office Card Account during initial telephone conversation.” 

“DWP are being quite dishonest in that they claim to be impartial while trying their hardest to push people away from the Post Office Card Account.”

In excess of 60% report that less than half of their customers who have changed have done so to a Post Office Card Account.

Three quarters of those who responded felt they had received positive help from their own industry over the change to Direct Payment with reference to training and so forth.

Under 30% considered that further banking services would be of use to their business. Those who had been in business for less than five years were the group that had most confidence in this being a way forward for their offices.

Contrast this with the 83% who felt that installing computer facilities in rural offices to encourage people to see the Post Office as a source of information and advice would be a positive move.

The majority of those who replied had heard of the Government’s £450 million fund for rural Post Offices but fewer than 30% thought that it would be of any help to them.

The most distressing answer for the sustainability of the rural Post Office network in rural Somerset was that nearly two thirds had no confidence in the future viability of their businesses. The sub postmasters who had been trading for less than five years had slightly more confidence. Generally the longer they had traded the less confidence they had.

Against this worrying scenario hopefully by regularly highlighting this problem and increasing awareness, more people will be able to insist on their rights and open a suitable account through which their money can be accessed in their local post office, which will help this vital community resource to remain open.

See our Community Projects page about Rescuing Village Post Offices  Click Here

The following are the existing high street bank accounts that can be accessed at post offices.

CURRENT ACCOUNTS:

Alliance and Leicester
Barclays
Cahoot
Co-Operative
First Direct
Lloyds TSB

BASIC BANK ACCOUNTS:

Abbey National
Alliance and Leicester
Barclays
Co-Operative
Halifax Bank of Scotland
HSBC
Lloyds TSB
National Australia Group - Yorkshire Bank, Clydesdale Bank and Northern Bank
Nationwide Building Society
Royal Bank of Scotland – NatWest and Ulster Bank

If you need any advice on the options you have or have a comment to make concerning this article do not hesitate to contact info@somersetrcc.org.uk

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