€30m Government loan boosts An Post

€30m Government loan boosts An Post
Communications Minister Denis Naughten

Rural post offices have been given a lifeline after the Government gave An Post a €30m loan to “protect the continuation of a five-day postal delivery service” to every address in the country.

The future of rural post offices have been in question in the past number of years as An Post struggled with the transition of more people moving online.

Communications Minister Denis Naughten said the €30m loan came with strict conditions including monthly performance reports on a monthly basis, and is long-term.

He said the loan would “inject the financial support urgently required to protect the future of the post office network” and would substantially change and modernise the business model.

The Irish Postmasters Union (IPU) welcomed the €30m package but said reforms had to be implemented “immediately”.

The union said the loan follows more than two years of negotiations which have involved two reports from Bobby Kerr, intensive talks between postmasters and An Post and ongoing Governmental engagements.

In 2015 the IPU presented a half a million public signatures to Government calling for investment in the post office network.

IPU General Secretary Ned O’Hara said: “The IPU is now keen to see the specific details of the investment and the timeline for its implementation. What is important is that a significant portion of this money goes to protecting and securing the Post Office Network and does not get consumed in addressing other problems faced by An Post.”

An Post said it had incurred a loss of €15.6m in 2016 and that this time last year, PWC forecast a loss of €61m in 2017 if no action was taken. “However decisive initiatives have been undertaken and the company is on course to break even this year,” An Post said.

It said its implementation of mail pricing in line with European averages, as well as a re-launch of its parcels business with evening and Saturday deliveries and later cut-off times for next-day delivery, had contributed an additional €8m profit this year. It added that a reduction of 316 full-time workers had been agreed with unions, and that the breaking into two businesses of post offices and mails plus parcels had allowed significant downsizing.

An Post CEO, David McRedmond said the company is facing into extraordinary challenges and that much work remained to be done.

The loan has been criticised by opposition parties as “nothing more than a job loss announcement”, with FF TD Timmy Dooley claiming it will be used for redundancy packages.

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