POL00448488
POL00448488
POL/NFSP/DBIT Working Group Meeting
Date: 17° January 2024
Time: 10.00 - 11.00
Location: Microsoft Teams
External attendees: e Kevin Hollinrake MP, Postal Affairs Minister
Ed Baird — DBT Policy Lead
Calum Greenhow, CEO, NFSP
Tim Boothman, NFSP
Susan Edgar, NFSP
Ruth Buckley Salmon - Public Affairs Manager, NFSP
teeta cue e =©Martin Roberts, Group Chief Retail Officer
© Tracy Marshall, Retail Engagement Director
Lauren Brogden, Retail Business Manager
© Jamie Park, Policy and Communications Manager
Agenda:
ow
ITV Drama
Christmas Trading Update
Banking Framework 4
NBIT
DVLA
Key Themes:
Postmaster frustrations that POL revenue is being ‘used up’ to deal with the past, putting a
strain on PO’s finances and PMs feel they are the ones suffering. Current position in media is
all about ‘retribution’ and we need to steer away from that. Instead, we need to concentrate
on what we’re doing for Postmasters now to re-store reputation and drive the business
forward.
NFSP stated that drastic measures are needed from the government is the way PO is
governed. Consideration of an ‘oversight committee’ was discussed. Minister suggested a
proposal is put together, but it must work alongside the board and not undermine them.
Putting consumer needs first was a key theme, ensuring POL identifies the best
opportunities that align with consumer trends and needs.
Finding ways to drive down central costs, to give more money to reinvest remains
imperative.
Need assurance that Horizon is fit for purpose today.
It was raised why Banking Hubs are separate businesses and not inside of existing large
Postmaster sites. Minister agrees that Banking Hubs should be inside existing PM premises
where there is space and offered to PMs where possible. Minister also believes criteria for
what is required for a Banking Hub is too tight. NFSP & POL agree that we need help from
the Minister to influence Cash Action UK on best practice.
Actions:
POL00448488
POL00448488
POL 1. Re-consider publishing Christmas trading statement — Jamie / Alice
2. Ensure multi-carrier strategy is included on our next agenda and ensure Nick
Read is equipped to share breakdown of non-RM propositions / branch coverage
with Minister Hollinrake as part of his meeting next week — Lauren / Jack D
3. Send KPMG Horizon review to DBT & NFSP and check if it has been made public —
Tracy / Shaun / Simon O
4. Strategise how to put consumer needs front & centre and aligning the Board to
this thinking by better sharing consumer trends etc — Laura/David
5. As part of Nick’s notes back to the Select Committee, need to include anticipated
NBIT roll-out and how we will ensure it is fit for purpose — Jamie / Jack F
NFSP 6. Oversight committee proposal
7. Share stats with DBT RE PMs have:
DBT 8. Ensure every Government department knows the value of the PO network.
Reiterate to fellow ministers so POL is front and centre of consideration for any
contracts
9. Banking Hubs — help to influence Cash Action UK on best practice / loosen criteria
10. Look into Bank Statement opportunity
Detailed Meeting Minutes:
Topic Notes
* Martin expressed empathy towards the current situation and thanked
Minister Hollinrake and the NFSP for their continued support in helping to
navigate through and ensure the best outcomes are reached for impacted
Postmasters.
* Martin mentioned he attended a restorative justice apology meeting with 5
ex postmasters — he noted the harrowing experience and explained that Post
Office has attended 40+ of these meetings so far and will continue.
Introduction
/ Backdrop * Martin noted that he attended the inquiry this week and our legal team are
encouraging more colleagues to do so.
*® Martin made reference to the PM livestream last night with the purpose of
giving PMs freedom to ask questions/topics that were on their mind. He
mentioned there was a good attendance and feedback has been encouraging
that we faced into questions, with a transparent and open manner. Minister
thanked POL for doing this and mentioned how important this is.
® Calum mentioned he was grateful for the ‘Westminster machine’ in
responding responded to the tv programme. He noted that the NFSP do not
NFSP’s refer to it as a ‘drama’ as it is an accurate representation and a harrowing
Reflections watch.
Past Couple
of Weeks e He expressed concern that since the Justice Fraser’s Ruling, people still
haven't convictions over-turned. It’s good to see the government response for
justice to finally be brought to these people.
POL00448488
POL00448488
Network support — NFSP are continuing to support and campaign for the
support of the public to support their local branches.
PM sentiment — NFSP explained that a lot of PMs feel they are footing the
bill, POL revenue being used up to deal with the past, strain on PO’s finance
and PMs feel they are the ones suffering. Many PMs are worried about their
PO investment. NFSP have explained how they’ve been talking with lots of
PMs who were going to retire, but their businesses are now ‘worthless’, in
some instances, they are now given them away for free.
Brand Perception — Martin explained POL is tracking branch perception and
the trust metric has dropped over the past couple of weeks.
Trading - Although there’s been no changes to income, trading patterns,
sessions etc. POL are performing well on our targets - positive position to
show consumers are still supporting.
NTL/Churn — POL continue to monitor and we’re not seeing a decline at
present against 5-year average but we’re not complacent and will continue to
track.
Retribution — NFSP expressed views that 90% of the press is about retribution
and we need to steer away from that. Need to start concentrating on what
we're doing for Postmasters now to re-store reputation. Otherwise, PMs of
today are going to be the next victims. All the wrongs of the past do need to
be addressed, but we need to find a way to drive the business forward.
Shareholder Support — NFSP stated that drastic measures are needed from
the government as well as the way PO is governed.
Oversight Committee — NFSP suggested the idea of an ‘oversight committee’
to collectively take responsibility about what we can do better. Bring in
different voices e.g DBT, CWU, NFSP. Martin said he would be open to
considering it, but it’s important not to over engineer or repeat, keep things
simple, need the right decision makers, with the right purpose/objectives.
Minister suggested a proposal for an ‘oversight committee’ is put together,
but it must work alongside the board and not undermine them. He suggested
incremental improvement rather than radical. Evolution is better than
revolution. Martin was in agreement and explained that POL is listening. We
work in partnership with NFSP, we talk with other people, working groups,
change forums etc. 5 new board members out of 9 - very experienced.
Refreshed board are going make the right decisions.
Attracting New PMs — NFSP mentioned no newcomers are coming forward.
Martin explained how we're still seeing enthusiasm for new Post masters,
but doesn’t disagree with the concern and we’re not complacent and will
continue to monitor. Setting the framework properly for the future is
imperative, ensuring it’s more lucrative to run a PO and attract new people
Minister's
Priorities
Minister Hollinrake has 3 priorities regarding the scandal:
1. Compensation
POL00448488
POL00448488
2. Ensure compensation is fair
3. Holding people to account
= Doing the right thing for the network and postmasters.
In terms of footing the bill, clearly resource is going to be needed to help
resolve. Government have been expediting resolutions over the past few
weeks. E.g Providing info to inquiry, turbo charging compensation
These things are having a profound affect, we are moving forward.
Martin stated that he is here to make a difference / make a change. He will
continue to do that and is committed to that (e.g any benefits from BF4
should go straight to the network)
Christmas
Trading
Martin shared some key trading headlines to indicate a strong trading period.
There were 52.5 million total customer sessions during the trading period, up
11% on the same period in 2022, and up 2% on 2019 (pre Covid-19).
Remuneration expected to be £40.6m which is £5.2m (14.8%) higher than
same period last year.
This makes it the highest paying month since Jan 2021 (£46.0m) when Covid
drove Christmas volumes up and the second highest paying month since Jan
2016 (£40.9m)
This sizeable increase is largely down to the poor performance this time last
year which was primarily driven by the Royal Mail strikes as well as the
addition of our multi-carrier approach — now at 37,000 non RM access points
NFSP feel a lot more branches should be offering multi-carriers — it’s creating
disparity across the network. Martin explained that following the successful
introduction and strong performance over Christmas, we continue to ramp up
our roll-out strategy. However, we are dictated by the carriers geographically,
but more are becoming available.
Minister & NFSP have requested POL to share the latest stats of how many
branches are offering non RM propositions.
Minister reiterated that we need to be realistic, we live in a demand-led
world and will be led by carriers. Ultimately it’s up to then but government
are happy to help where possible
Martin gave an example of a PM who has attracted 50 new customers a
month as a result of offering multi-carrier
Minister encouraged that POL’s Christmas Trading Statement is released to
press, to show that customers are still using Post Office. A small window and
timely opportunity to publish.
Consumer
Needs
Minister made it clear that we can’t stand in the way of progress (e.v DVLA
renewals online example).
POL needs to identify the best opportunities that align with consumer trends
Minister stated that we need to put consumers first, not PMs, and we need
POL00448488
POL00448488
to ensure decisions at a board level align with what consumers want.
Board needs to understand consumer trends.
NFSP explained that they aren’t against ‘online’ but that the government
have a role to play as they give work out of the network E.g Paypoint
Minister offered to send note to reiterate to fellow ministers, so they
understand the value of the PO network and ensure POL is front and centre
of consideration for any contracts
Agreed that we're all keen to get every possible opportunity if it aligns with
the consumer
Minister will take away the bank statements opportunity
Banking
Hubs
NFSP raised why Banking Hubs are separate businesses and not inside of
existing large Postmaster sites
Minister agrees that Banking Hubs should be inside existing PM premises
where there is space and offered to PMs where possible
Minister also believes criteria for what is required for a banking hub is too
tight. NFSP & POL agree that we need help from the Minister to influence on
best practice
Martin explained that we're trialling a Banking Hub internal to a branch at
Royal Wotton Bassett
Driving
Down POL’s
Central Costs
Calum shared some stats that {__
reiterated importance of driving down PO’s costs
He mentioned the back-office payments incentive scheme which NFSP are
helping to build with POL whereby PMs could earn potentially additional
more worth of rem, whilst helping to drive down POL’s central costs
If we can drive down central costs, it gives us more money to reinvest.
Minister mentioned board is aligned to this thinking.
Martin reinforced that the NFSP should be under no illusion that we’re not
looking at costs day in and day out. He assured them that POL has been given
a challenge by DBT to reduce costs and that is our aim and objective to
demonstrate we can do that. We’re working hard on what that means in
terms of s possible re-structure etc and that they will see output of that over
the next few months as we work forward.
NBIT
Martin reinforced that it is imperative that POL replaces Horizon in the right
way and we are progressing with final testing with a view of expanding the
pilot from through the coming year.
Assurance review with Accenture has been completed
200 people working party — although NFSP flagged not all are regularly
engaged
NFSP feel they have small pieces of the jigsaw, but not the big picture. They
want more confidence that each stage is going right.
Calum met with Chris B POL’s Chief Transformation Officer who is happy to
meet again. Minister was complimentary of Chris B to give confidence that
the project will be successful
NFSP to have further conversations with the NBIT team
They also flagged that all parties need assurance that Horizon is fit for
purpose today. KPMG have completed a review NFSP & DBT have asked for
the outcomes. Need to check if it’s been made public