Thursday night - shock news on Post Offices

But the Federation remained unconvinced that the package announced by Trade and Industry Secretary Alistair Darling will in itself draw a line under difficulties faced by the Post Office and bring about the NFSP's goal of a sustainable national network of post offices.

Following months of campaigning, the Federation hailed Government plans to maintain the Post Office card account (POCA) '“ used by 4.3 million people '“ beyond 2010 and to develop a successor product with increased functionality as a "victory for the nation and for common sense."

This decision to allow customers to continue to claim their pensions and benefits at the Post Office follows an NFSP petition of four million names presented to 10 Downing Street in October during a major lobby of Parliament attended by thousands of subpostmasters and their customers. It signals a major reverse from original Government plans announced in January this year to end POCA by 2010 and to migrate customers from the card account to payment into bank accounts by that date.

The Government's announcement today that it will also maintain the 150 million a year Social Network Payment '“ which supports the social and economic service provided to communities by thousands of valued rural post offices across the country '“ up to 2011 also represents a major achievement for the Federation's campaign. However, the Federation expressed concern that the funding was not linked to RPI and would therefore lose value over time.

Plans for consultation on the phased closure of around 2,500 post offices were deeply regretted but are accepted by the NFSP as an unfortunately necessary part of establishing a sustainable post office network for the future, in view of the scale of withdrawal of Government business from the network in recent years and the consequent viability of some sub post offices as independent businesses.

Colin Baker, General Secretary of the NFSP spoke soon after today's announcement.

He said: "We have campaigned very hard to protect post offices but we have always made it clear that the most important goal was to establish a post office network that is viable. Our goal is for a sustainable, thriving network, rural and urban alike, which delivers modern products and services for customers and can attract new investment, both from current subpostmasters and those considering joining the network.

"The package announced by the Government today goes some way to creating the conditions which can, over time, create a viable network. We warmly welcome the decision to retain the card account and the Social Network Payment as a victory for the nation and for common sense."

"However, we need to see more details and to continue discussions with the Government and with Post Office Ltd to ensure new products and services are added to this package to deliver a truly viable and sustainable network for the future."

"The NFSP welcomes the opportunity for public consultation on the future size and shape of the network. We bitterly regret the need to accept that some post offices will close and it is a sad indictment that a programme of closures is better than the slow death of the entire network. We are however reassured that we have won the recognition for the need for compensation for those subpostmasters forced to close their offices. We will work with Post Office Ltd and with the Government to ensure that the public aren't left without access to Post Office services."

"We hope that today's proposals will allow us to draw a line under the uncertainty and difficulties experienced by the network this year. If post offices are given direction and support, the opportunity to continue to deliver Government services and to develop new products, we have the opportunity to create a truly sustainable network and to move forward towards a vibrant and viable future."

"However, our campaign is not over. Post offices touch the lives of millions of people from all walks of life across the UK. We will therefore maintain the pressure on Government and on Royal Mail Group to deliver these commitments and to make sure that the network is given the best possible chance to succeed."