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27 March 2024
Dear all,
Last year, we committed to providing you with an
annual update on remuneration increases before the
financial year starts in April. Through these annual
reviews our aim is to increase, over time, the share of
Post Office income going to Postmasters.
We understand that the current economic
environment remains challenging, and we are acutely
aware of the significant impact that minimum wage
increases will have on your costs. Against that
backdrop and within the constraints of our overall
financial position, we have developed remuneration
increases which will have a sustainable benefit to your
branch profitability.
Today we are announcing the following improvements
which are collectively worth £30 million for
Postmasters:
Additional payment for 2023/24 performance
Post Office's online business has performed strongly
this year, and we want to share this success given your
hard work helping to build the brand and delivering
fantastic customer service. You will therefore receive
an additional one-off payment, equal to 15% of your
variable remuneration for March 2024 trading, which
will be paid in April 2024. Across the network, this
equates to a nearly £5 million investment by Post
Office.
Operational Excellence Incentive
We know that back-office activities, such as cash
processing and accounting, take a significant and
increasing amount of time for Postmasters. In
recognition of this, in August 2022, we doubled the per
transaction remuneration rate for banking deposits,
and last April we increased all banking deposit
remuneration by a further 20%.
To build on this, we are launching an Operational
Excellence Incentive to give you the opportunity to
boost your total variable remuneration by up to 5%
each month, by meeting existing operational
requirements for the running of your branch. These
payments will be based on meeting the specific
requirements for daily cash declarations, cash pouch
remittances, cash holdings and monthly trading period
accounting.
The first remuneration payment for the incentive will
be made on 30" September 2024. This will be based
on activity in the August trading period (5" August - 1¢
September). Information about your branch
performance will be available on Branch Hub from late
April.
We have worked extensively with the Postmaster
NEDs, Postmaster Regional Forums, the Postmaster
Experience Director and the NFSP to get their feedback
and to ensure the scheme works for Postmasters. We
will continue to adapt and evolve the incentive based
on Postmaster feedback.
Supporting information and training
We will be sharing more information and support on
the incentive over the coming months. We have put
together an information pack including FAQs to
support you which you can access here.
We are also in the process of updating the Operations
Manual to make it more user friendly. The updated
online version will provide you with information on
everything you need to be able to run your branch ona
day-to-day basis, including useful information on cash
declarations, cash pouch remittances, cash holdings
and monthly trading period accounting. Look out for
further news on this in April.
Note counters investment
Today's announcement is complemented by a
£3.5million investment, by the Post Office, to roll-out
high-grade note counters for our 2,800 largest banking
branches. This will help automate this process by
streamlining the accurate processing of cash deposits.
Further details of the roll-out schedule will be
communicated to these branches in the coming
months.
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Other Remuneration Increases
Earlier this month we confirmed that Royal Mail
volume-based products such as pre-paid parcels and
returns will be increased by 4.0% in line with CPI. This
is applicable from April trading for May remuneration.
Alongside the Royal Mail tariff increases (which take
effect from 2" April), this is expected to increase mails
remuneration by around £12m or 6.7% based on the
same volumes and product mix from the last 12
months.
We are also pleased to confirm the following increases:
© DVLArates will be increased by 21% following our
successful negotiations to extend the contract for a
further year
© There will be an average increase of 9.4% on
outreach payments to take into account the
national living wage increase and changes in fuel
prices
© Mailwork payments will increase by 4.6% from
April remuneration
° The remuneration for Moneygram and Western
Union Cash to Account services will increase to
the same level as the Send product
¢ Wewill also continue for a further year the
additional support announced last March for
critical town and city centre Mains branches which
have continued to benefit less in FY23/24 from
banking growth.
The specific rates for all changes can be viewed in the
remuneration rates booklets found in the
remuneration section on Branch Hub. These new rates
will apply from April trading (May remuneration)
except for Mailwork.
Over the coming months, we will be hosting two
Postmaster Listening Groups (22nd April in London &
7th May in Leeds) and our Postmaster Conference on
18" June in London. These will be an opportunity for
you to speak with me and other members of the
leadership team and tell us your thoughts. Please look
out for more details, including how to sign up, in the
weekly Postmaster email.
Thank you all your hard work this year. Its been
incredible to see the huge impact that Postmasters
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continue to make to their communities across the UK,
embracing new services like Evri and DPD and
providing customers with fantastic service, every day.
Best wishes,
Nick Read
CEO, Post Office
Post Office Limited
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