Ministers are investigating proposals to transfer ownership of the Post Office to thousands of sub-postmasters throughout the UK in a groundbreaking transformation of the 364-year-old establishment.
Sky News has learned that the Department for Business and Trade (DBT) has instructed BCG, a management consulting firm, to assess potential options for mutualising the Post Office.
This initiative is reportedly in its preliminary stages, with an expectation of delivering a report to Jonathan Reynolds, the Business Secretary, in the upcoming months, according to a government source.
BCG’s analysis is anticipated to involve evaluating the feasibility of converting the Post Office into an employee-owned mutual, akin to the model utilized by the John Lewis Partnership, a Whitehall source indicated.
Individuals familiar with the developments warned this weekend that no definitive choices have been made, emphasizing that the mutualisation of the Post Office may be a protracted and intricate endeavor.
The Post Office serves as the largest retail network in Britain, boasting approximately 11,500 branches, yet it remains financially viable primarily due to an annual subsidy allocated by the government.
In April, Kevin Hollinrake, the then-Conservative minister accountable for postal issues, convened with trade union leaders and representatives from the cooperative sector to explore the potential for mutualising the Post Office.
The current minister overseeing the Post Office, Gareth Thomas, has chaired the Co-operative Party for nearly two decades.
Both Mr. Thomas and Mr. Reynolds are scheduled to provide testimony for the public inquiry into the Horizon IT crisis next month, where they might be questioned regarding the project being conducted by BCG during their testimonies.
The Post Office is entirely state-owned, with public shareholding supervised by UK Government Investments (UKGI).
In recent months, there has been an increased demand for a reassessment of the company’s ownership structure, fueled by public outrage over the wrongful convictions of numerous sub-postmasters accused of theft from their branches.
Highlighted by the ITV drama “Mr Bates vs The Post Office,” which brought the scandal to a broader audience, it has been dubbed Britain’s most significant miscarriage of justice.
Many individuals impacted endured severe health issues, relationship breakdowns, or passed away prior to their exoneration.
This week, Sir Alan suggested that the government should contemplate legal action against former directors of the organization.
Sir Alan, who was knighted during the King’s birthday honors in June, has yet to settle on a compensation agreement with the government.
The Post Office’s difficulties have intensified this year, marked by internal governance disputes and public clashes between the company’s board and its governing body.
In January, Henry Staunton, the chairman, was dismissed by Kemi Badenoch, the then-business secretary, for what she claimed were significant governance shortcomings.
Mr. Staunton later revealed an investigation into allegations of bullying against Nick Read, the Post Office’s CEO, which the organization reported in April had cleared him of wrongdoing.
Mr. Read faced accusations of persistent efforts to secure salary increases, even as sub-postmasters dealt with extensive delays in their compensation entitlement following wrongful convictions.
As part of their measures to rehabilitate the Post Office’s tarnished finances and reputation, the government appointed Nigel Railton, a former head of the National Lottery operator Camelot, as its chairman.
One of Mr. Railton’s primary responsibilities will be to appoint a new chief executive, as Mr. Read confirmed last month that he would be stepping down after five and a half years in the position.
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Any endeavor to mutualise the organization would also need to consider the ongoing financial implications of the compensation liabilities related to the Horizon IT scandal, in addition to the fact that a replacement system has yet to be effectively established.
Following his meeting with Mr. Hollinrake in April, Andy Furey, a national officer at the CWU Union, remarked: “There must be a completely new operational framework for the Post Office moving forward to stay pertinent to society.
“[The] individuals on the front lines delivering the service to communities every day merit a considerably larger role in the administration of the Post Office.”
This weekend, a spokesperson for the Department for Business and Trade declined to provide comments.
