Mr. David McRedmond:

I submitted my introductory remarks to the committee so I will highlight a number of the items in it. When I appeared before the committee last year I had just joined An Post. We had a very severe financial crisis. PwC had estimated we would lose €61 million this year. I am pleased to say that as a result of some of the actions Ms Cronin outlined and some of the actions we have taken in An Post, we expect to break even by the end of the year. We have managed to get ourselves into a position of some sustainability but we have yet to get ourselves to a position of growth. One of the essential things we did was to increase prices but that just got them up to the European average. It has been extremely important for us to take the tough decisions that allow a business and service to be viable. For years prices were suppressed and it was a tough decision. I commend the Department, the Minister and the Government for backing it. It has allowed us to get to viability. The second thing is in terms of mails and parcels we completely relaunched our parcels business. This time last year there was a project about whether An Post should probably get out of parcels. We said parcels were our future. We worked very closely with the unions, particularly the CWU. We agreed to Saturday delivery, later cut-off times and a whole range of new products so that today customers in Ireland have probably one of the best parcel services anywhere in Europe. They are able to get parcels from anywhere around the world. They can get them delivered next day and collected from their homes. It is very significant change. To date, we have about €8 million additional revenue from that parcel business. The third thing we have done is made a very significant reduction in our head count. At the end of this year, somewhere in the region of 350 people will have left. Some have left already but 316 additional people will be leaving An Post. That has been done with the agreement of the unions on a voluntary basis. That is a huge credit to the staff of An Post and shows the organisation is really grappling with the issues of the pressures of mail decline. That is what has happened on the mails and parcels side of the business. We have implemented a strategy. We brought in McKinsey. We looked at the business of An Post and we decided to split between mail and parcels and the post office network. The mails and parcels business is now moving forward like a train and I can see a whole load of developments coming there in the years ahead as we become the backbone for e-commerce in Ireland. The post office network side of the business we have done all we can centrally to be able to reform and modernise that business. It needs rapid modernisation. We have put in place a management team that has control over the business. We have identified the three areas in which the business has to succeed and grow. The first is in financial services.

We launched the smart account, but we have far more to do. We have to investigate again where An Post can go with banking, community banking and making services available throughout the State. We are exploring that right now while we continue to develop financial products. We have proven that we can do it. We have proven with our smart account and foreign exchange services that we have the capability. We need to extend our range of services. We have also proven our capability with State savings. Through An Post, the State has built up savings of over €20 billion. We believe we can build something very big on the back of this significant business and significant level of activity.

The second area of interest is Government services. This probably relates somewhat to the earlier conversation about the television licence fee. I was unaware of this proposal until I read about it in the Sunday newspapers. When I think about the real meaning of the post office, it strikes me that it should be the State's office in every town and community. We have committed to ensuring there is a post office in every community of over 500 people. We want the harp to be above the door. We want citizens to know they can get every service through the post office. We want all of those services to be available through An Post online. That is a major piece of activity for the post office network. Financial services is the first leg of our activity and Government services are the second leg. It is right that Deputies and Senators are concerned about whether post offices will remain open, but it is wholly unrealistic of them to want to keep every post office open while moving Government services away from the post office. It is very important that we do our job to deliver that efficiently, well and in a modern way so that consumers can absolutely rely on the service they get from the post office and can see the post office as a one-stop shop. If we make Government services available, we can add real value to communities throughout the State. It is a very important piece of what we do.

The third area I would like to highlight is our mail and parcels business, which is the backbone of e-commerce in Ireland. We want to strengthen the important part the post office network plays in that supply chain and make sure it is known. The post office has a viable and strong future. We have completely restructured ourselves internally. We have built a machine that can deliver what we are seeking to deliver. We need to be able to move on with the actual footprint of the network so it can work in a way that involves modern and properly broadband-connected post offices that can deliver a range of services. The attention and focus of the post office side of the business will be on providing those services, which will be replicated online, in the months and years ahead.