Victory for Post Office card users

THE Government last night bowed to pressure and allowed the Post Office to continue running the card account which distributes benefits to thousands in Oldham.

Pensions secretary, Mossley MP James Purnell, told the Commons that ministers had decided to close the bidding process on who should run the Post Office Card Account (POCA) and awarded it to the Post Office until 2015.

The Post Office had faced private competition for running the POCA including from PayPoint, which operates in newsagents and petrol stations.

Mr Purnell told MPs he would do “nothing to put the network at risk”. It was feared another 3,000 post offices across the country could close if the contract were lost.

The POCA is used by four million people as a way of receiving benefits and pensions. The account earns the Post Office £200 million each year. Government figures show there are some 18,000 POCAs in Oldham and a further 9,000 in Ashton.

Oldham East and Saddleworth MP Phil Woolas said: “I am delighted and relieved. I promised my electorate that the post office card account would be saved. I have received more communication on this than ever on any other issue.

“I have written to thousands of constituents. There was always going to be a POCA, this confirms that it will remain in-house.”

Mr Purnell told the Commons the contract would run initially from April 2010 until March 2015 with “the possibility of an extension beyond that”.

He said that, in a time of financial turbulence, the Post Office was a “trusted brand” seen as a reliable provider of financial services.

The move would help ensure a viable future for post offices left in place after the current modernisation programme, he said.

But the Tories accused the Government of a “humiliating climbdown”.

Alan Duncan, shadow secretary of state for business, said: “Post offices, communities and many of the country’s most needy people will today be breathing a sigh of relief that the Card Account has been re-awarded to the post office. But this is a decision that the Government has been shamed into making, from a mixture of internal weakness and division in their own ranks.”