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To BIS Perm Sec
From Post Office Network Team
Date 23 September 2011
Meeting with Alice Perkins, Chair - Post Office Ltd
15:00-15:30 Tuesday 27 September 2011
Purpose
First formal meeting with Alice Perkins, the newly appointed Chairperson of Post Office Ltd
(POL), to discuss the Government's strategic goals, and to explore her initial impressions of
the company.
Attendees
Alice Perkins (POL)
Optional — Will Gibson (ShEx)
Your objectives
e To make clear the importance of POL’s separation from Royal Mail, and the role of a
strong, independent POL Board in achieving that.
e To offer reassurance that the appointment of the Senior Independent Director (SID) is
on track.
e To gain an initial impression from Alice, of how she views the challenges and
opportunities of the new role.
Alice Perkin’s objectives
e This is the first of Alice’s meeting with the BIS Executive team (Alice will be meeting
both SoS and Edward Davey in October). She will be looking to gain a clear
understanding of the Department's priorities.
Background
Alice was appointed Chair on XXX, and formally took office on XXX. She joins at a critical
time for the company, which is in the process of negotiating key contracts with Royal Mail that
will be vital to securing the future sustainability of the company. Alice will need to
demonstrate clear and strong leadership to ensure that the interests of POL, often perceived
as the junior partner to Royal Mail, are best reflected in the separation process.
As Chair, Alice has stated her intention to conduct a review of POL’s Executive team to
ensure that there is an appropriate mix of skills and experience to meet the challenges that
the business faces in transforming its network, developing new services and winning
contracts, eliminating Crown losses, and preparing the company for possible mutualisation.
CC list Cable MPST; Davey MPST; SPAD MPST; Susannah Storey; ShEx POL team; Josh
Coe.
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AGENDA FOR MEETING - ISSUES TO RAISE AND POINTS TO MAKE
y fo con of the Board and
Executive Executive team to identify what skills exist, and whether there
team are skills and knowledge gaps.
¢ Ministers are currently considering your recommendation that
Neil McCausland be appointed SID.
sID « My officials have met Neil, and were impressed with his range
of skills, and believe that he would be an asset for the
company.
¢ Separation will allow POL to focus on the challenges and
opportunities that it faces.
¢ This separation should happen as soon as possible and
certainly before the pension solution.
¢ But as Moya Greene and Donald Brydon said to Parliament,
POL and Royal Mail will remain reliant on one another. It is
therefore vital that the right commercial contracts between the
two companies are delivered. These negotiations are occurring
now.
Separation
¢ The network is entering a critical phase as new operating
models and developed, and the next year is particularly
important.
¢ In October POL will be engaging with its agents on the new
Network models, and framing these communications must be properly
and fully planned.
¢ By 2015, over half the network will have moved to new
operating models. POL has a good track record of successfully
conducting large scale network changes, but we must not be
complacent.
transformation
¢ Government services form a key part of the Commercial
Strategy that was instrumental in securing such a large and
generous Spending Review settlement.
¢ There is already a lot of scrutiny on this aspect of the
Government Commercial Strategy and this will only increase.
services ¢ It is fundamentally important that POL as an organisation
understands that it be commercial to win Government
contracts. The SMOTs experience shows that Government
cannot simply award contracts to POL.
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Key commitments contained in the Policy Statement “Securing the Post Office Network
in the Digital Age” (Nov. 2010)
e We recognise that the Post Office is more than a commercial entity and serves a
distinct social purpose.
e We-will ensure that post offices remain a valuable social and economic asset for
our communities and businesses.
e There will be no programme of post office closures under this Government.
e The Post Office is not for sale.
e We will provide £1.34 billion for the Post Office to modernise the network and to
safeguard its future, making it a stronger partner for Royal Mail.
e We want to see the Post Office become a genuine Front Office for Government at
both the national and local level.
e We will support the expansion of accessible and affordable personal financial
services available through the Post Office.
e We will support greater involvement of local authorities in planning and delivering
local post office provision.
e Weill create the opportunity for a mutually owned Post Office.
e The breakdown of payments to the Post Office will be as follows:
£180 million in the financial year 2011-12 (as we have already committed)
- £410 million in the financial year 2012-13
- £415 million in the financial year 2013-14
£330 million in the financial year 2014-15