Post Office closures: Union backlash over proposed job cuts – as ‘transformation plan’ revealed

Published

9 months ago

November 13, 2024

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A union representing Post Office staff has lashed out at proposals that could result in 115 branch closures and significantly more than 1,000 workers losing their jobs, by describing them as “immoral”.

The Communication Workers Union (CWU) signalled a fight ahead as the Post Office confirmed details of its transformation plan – first revealed by Sky News on Tuesday – that aims to boost postmaster pay by £250m over five years.

The embattled firm’s initial statement failed to mention threats to employment at its head office and within 115 larger “crown” branches.

While its wider proposals aim to place postmasters at the heart of the government-owned business in the wake of the Horizon IT scandal, it was later confirmed that 1,000 roles at the crown sites were at risk.

These large branches are owned by the Post Office.

Revealed: The full list of 115 Post Offices at risk of closure

A franchise model was being considered as an alternative.

The potential closure of these sites is another option. While such a move would cut costs, it would also spread business to nearby branches run by sub-postmasters.

A cost-cutting drive would also see hundreds of head office roles go.

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But the CWU boss, Dave Ward suggested the business, and the government, would have a fight on its hands, describing the decision as “tone deaf as it is immoral” in the wake of the IT scandal that saw hundreds of sub-postmasters wrongly jailed and struggle in their fight to secure redress and compensation.

“CWU members are victims of the Horizon scandal – and for them to now fear for their jobs ahead of Christmas is yet another cruel attack”, he said.

“While we are in the middle of a government review of the Post Office’s future, the employer has embarked on its own strategic review.

“It seems the Post Office has learned no lessons from its chaotic and uncoordinated mistakes of the past.

“We call on the Post Office to immediately halt these planned closures and the attached consultations – which, historically, have been nothing but playing lip service – and engage with the CWU on protecting jobs and services.

“We also call on the government to intervene over this shambolic decision.”

The five-year transformation plan, which includes an effort to double revenues for postmasters over five years, was initiated in May by the Post Office’s new chairman Nigel Railton who ordered a strategic review.

He told staff on Wednesday that postmasters could expect up to £120m in additional remuneration by the end of the first year of the plan, representing a 30% increase in revenue share – tackling long-held complaints about poor rewards for postmasters’ work.

Promises of less red tape and a better voice in decision-making were also included.

Mr Railton succeeded Henry Staunton – sacked by-then business secretary Kemi Badenoch in January – and was under immediate pressure to set a new path for the scandal-hit business that served postmasters rather than itself.

Mr Railton said: “The Post Office has a 360-year history of public service and today we want to secure that service for the future by learning from past mistakes and moving forward for the benefit of all postmasters. We can, and will, restore pride in working for a business with a legacy of service, rather than one of scandal.

“The value postmasters deliver in their communities must be reflected in their pockets, and this Transformation Plan provides a route to adding more than £250m annually to total postmaster remuneration by 2030, subject to government funding.

“It begins a new phase of partnership during which we will strengthen the postmaster voice in the day-to-day running and operations of the business, so they are represented from the frontline to the boardroom.”

Further changes being considered by ministers include potentially handing ownership of the Post Office to sub-postmasters, as revealed by Sky News last month.

Such an employee-owned model, known as a mutual, would be comparable in the private sector to that of the John Lewis Partnership – the owner of Waitrose supermarkets and the eponymous department store chain.

Chris Head, once the youngest sub-postmaster in the UK but who lost everything when he was wrongly accused of theft as part of the Horizon scandal, welcomed the prospect of a widespread shake-up.

He said of the plan to deliver more revenue: “We must ensure that a large proportion of that ends up with postmasters to bolster their poor remuneration levels whilst at the same time innovating for the future to develop more products and services for customers in order to drive footfall into branches.

“There must be a commitment from government to help deliver this and the end goal being mutualisation for a successful future.”

Mr Head added that the prospect of head office job cuts in the months ahead was good news, saying: “Post Office has always been a top heavy organisation and that needs to change going forward to make it more efficient.”

Business

Tesla approves $29bn share award to Elon Musk

Published

16 hours ago

August 4, 2025

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Tesla approves bn share award to Elon Musk

Tesla’s board has signed off a $29bn (£21.8bn) share award to Elon Musk after a court blocked an earlier package worth almost double that sum.

The new award, which amounts to 96 million new shares, is not just about keeping the electric vehicle (EV) firm’s founder in the driving seat as chief executive.

The new stock will also bolster his voting power from a current level of 13%.

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He and other shareholders have long argued that boosting his interest in the company is key to maintaining his focus after a foray into the trappings of political power at Donald Trump‘s side – a relationship that has now turned sour.

Musk is angry at the president’s tax cut and spending plans, known as the big beautiful bill. Tesla has also suffered a sales backlash as a result of Musk’s past association with Mr Trump and role in cutting federal government spending.

The company is currently focused on the roll out of a new cheaper model in a bid to boost flagging sales and challenge steep competition, particularly from China.

The headwinds have been made stronger as the Trump administration has cut support for EVs, with Musk admitting last month that it could lead to a “few rough quarters” for the company.

Tesla is currently running trials of its self-driving software and revenues are not set to reflect the anticipated rollout until late next year.

Musk had been in line for a share award worth over $50bn back in 2018 – the biggest compensation package ever seen globally.

But the board’s decision was voided by a judge in Delaware following a protracted legal fight. There is still a continuing appeal process.

Earlier this year, Tesla said its board had formed a special committee to consider some compensation matters involving Musk, without disclosing details.

The special committee said in the filing on Monday: “While we recognize Elon’s business ventures, interests and other potential demands on his time and attention are extensive and wide-ranging… we are confident that this award will incentivize Elon to remain at Tesla”.

It added that if the Delaware courts fully reinstate the 2018 “performance award”, the new interim grant would either be forfeited or offset to ensure no “double dip”.

The new compensation package is subject to shareholder approval.

Business

Motor finance operators can breathe big sigh of relief

Published

16 hours ago

August 4, 2025

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Motor finance operators can breathe big sigh of relief

Bank stocks have enjoyed a boost as traders digest the Supreme Court’s ruling on the car finance scandal.

Some of the country’s most exposed lenders, including Lloyds and Close Brothers, saw their share prices jump by 7.55% and 21.62% respectively.

It came after the court delivered a reprieve from a possible £44bn compensation bill.

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Banks will still most likely have to fork out over discretionary commissions – a type of commission for dealers that was linked to how high an interest rate they could get from customers.

The FCA, which banned the practice in 2021, is currently consulting on a redress scheme but the final bill is unlikely to exceed £18bn. Overall, the result has been better than expected for the banks.

Lloyds, which owns the country’s largest car finance provider Black Horse, had set aside £1.2bn to cover compensation payouts.

Following the judgment, the bank said it “currently believes that if there is any change to the provision, it is unlikely to be material in the context of the group”.

The judgment released some of the anxiety that has been weighing over the Bank’s share price.

Jonathan Pierce, banking analyst at Jefferies, said the FCA’s prediction was “consistent with our estimates, and most importantly, we think it largely de-risks Lloyds’ shares from the ‘motor issue'”.

Bank stocks have responded robustly to each twist and turn in this tale, sinking after the Court of Appeal turned against them and jumping (as much as 8% in the case of Close Brothers) when the Supreme Court allowed the appeal hearing.

Concerns about this volatility motivated the Supreme Court to deliver its judgment late in the afternoon so that traders would have time to absorb the news.

Business

FCA considering compensation scheme over car finance scandal – raising hopes of payouts for motorists

Published

2 days ago

August 3, 2025

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FCA considering compensation scheme over car finance scandal - raising hopes of payouts for motorists

Thousands of motorists who bought cars on finance before 2021 could be set for payouts as the Financial Conduct Authority (FCA) has said it will consult on a compensation scheme.

In a statement released on Sunday, the FCA said its review of the past use of motor finance “has shown that many firms were not complying with the law or our disclosure rules that were in force when they sold loans to consumers”.

“Where consumers have lost out, they should be appropriately compensated in an orderly, consistent and efficient way,” the statement continued.

The FCA said it estimates the cost of any scheme, including compensation and administrative costs, to be no lower than £9bn – adding that a total cost of £13.5bn is “more plausible”.

It is unclear how many people could be eligible for a pay-out. The authority estimates most individuals will probably receive less than £950 in compensation.

The consultation will be published by early October and any scheme will be finalised in time for people to start receiving compensation next year.

What motorists should do next

The FCA says you may be affected if you bought a car under a finance scheme, including hire purchase agreements, before 28 January 2021.

Anyone who has already complained does not need to do anything.

The authority added: “Consumers concerned that they were not told about commission, and who think they may have paid too much for the finance, should complain now.”

Its website advises drivers to complain to their finance provider first.

If you’re unhappy with the response, you can then contact the Financial Ombudsman.

The FCA has said any compensation scheme will be easy to participate in, without drivers needing to use a claims management company or law firm.

It has warned motorists that doing so could end up costing you 30% of any compensation in fees.

The announcement comes after the Supreme Court ruled on a separate, but similar, case on Friday.

The court overturned a ruling that would have meant millions of motorists could have been due compensation over “secret” commission payments made to car dealers as part of finance arrangements.

The FCA’s case concerns discretionary commission arrangements (DCAs) – a practice banned in 2021.

Under these arrangements, brokers and dealers increased the amount of interest they earned without telling buyers and received more commission for it. This is said to have then incentivised sellers to maximise interest rates.

In light of the Supreme Court’s judgment, any compensation scheme could also cover non-discretionary commission arrangements, the FCA has said. These arrangements are ones where the buyer’s interest rate did not impact the dealer’s commission.

This is because part of the court’s ruling “makes clear that non-disclosure of other facts relating to the commission can make the relationship [between a salesperson and buyer] unfair,” it said.

It was previously estimated that about 40% of car finance deals included DCAs while 99% involved a commission payment to a broker.

Nikhil Rathi, chief executive of the FCA, said: “It is clear that some firms have broken the law and our rules. It’s fair for their customers to be compensated.

“We also want to ensure that the market, relied on by millions each year, can continue to work well and consumers can get a fair deal.”