Mr. Kieran Mulvey:

An Post has been the beneficiary of new technology but new technology can be a bit of a curse as well. We identify this in the volume of letters sent. Our letter volume, post and stamps, is decreasing 8% to 9% per year. That is not unusual as the same is occurring in other parts of Europe. People are simply not sending as many letters as before. That is a fact of life. They are using email, WhatsApp or whatever other technology or device they are linked into. This creates no income, except for the over-the-top providers, which are always international, not domestic. This is a big issue in terms of how we go about rectifying this potential decrease in our income. Reluctantly, we have had to go the price increase route for a period. That obviously has a limit to it, as I said.

In terms of the mails, we are in a competitive environment with two or three other big suppliers in Ireland. They are building facilities, warehouses and others to meet this new high volume of traffic. It is a difficult and highly competitive market. We are at the upper end of it in the sense of quality of delivery. We are also probably competing with non-unionised organisations, which has a labour cost element to it. It is not an area we are going into. We have a very well established trade union tradition with An Post. I was involved in mediating in some of the labour disputes in the past but we have a very positive, engaged workforce. They have been very co-operative with us on the changes we need to make. The mails is a big competitive environment for us. For example, one is not too worried about the Monday to Friday or even the early part of Saturday but Saturday afternoon or Sunday is premium cost. The question is how do we manage to deliver.

I always tackle our management in An Post and ask why am I seeing Amazon parcels being delivered on a Sunday and not An Post delivery. It is a bit of a rhetorical question because I know the answer. It is a sensitive issue with our trade unions but it is one that we are going to engage with them on. We have to look at that. Our employees are attuned commercially and probably more commercially at times than we are in the sense that they see the volumes and the traffic. We are looking at what will be our future next-generation mail delivery and we are actively involved in that as part of the strategy.

The Cathaoirleach identified the volume of mail delivery. In a sense, it is trying to get businesses to continue to transact postal mail. Some of those that still do bring the mail out of the jurisdiction into Northern Ireland or other jurisdictions where they can do it cheaper or, if they are part of an international company, they are mailing from abroad. That is a particular problem for us.

We had an interdepartmental committee. I do not know what happened or what the total outcome was on government services being looked at in terms of provision to An Post. I do not think anything substantially material came out of that, which is disappointing. As I said earlier, the rural policy document issued by the Government recently identified the importance of it. I hope our cris de coeur around that will be heard for our managing it. I think the statement made by the Minister, Deputy Chambers, around cash is very important. Many of our customers, particularly in vulnerable communities or who have a vulnerable profile – I do not want to go into specifics – need that cash engagement and need that ability to get cash. Of course we have the currency situation, which is very good and is increasing all the time, for foreign travel. That is a particular other end of the market on which we are succeeding.

Obviously I have to be careful commercially around how this relates to our strategy but we see ourselves as having a significant financial presence. Is that presence big enough or strong enough to attract a wider investment and a wider product delivery? We are looking at that as part of our strategy nationally and internationally. I cannot go into it for commercial reasons but we are active in that area in conversations. I cannot say more than that. However, we are also conscious that the Government’s view would be to establish another Irish-based, Irish-owned entity that produces financial services to the people of the country now that certain foreign banks have left the country in recent years. This is a sensitive area and this work needs to be done sensitively for the parties involved. It might have stock market implications for some companies. I assure the committee that we are kind of active in that area.

We had some very successful joint ventures over the years with One4All and the national lottery. We have one or two businesses in the UK that have been successful. We are looking at the possibility of selling them off now that they have reached a capacity that would help our own capital injection.

There is a limited capacity to get out of the post offices that we have for sale. We are conscious that we have a social responsibility in regard to some of them. Clearly, we have a responsible investment policy in our post offices, in particular. It is not just in the small towns and villages but, as the Cathaoirleach mentioned, the suburban areas as well. We have to watch where the footfall is going and where housing is being built. The reason the Cathaoirleach has four in his particular area is that north Dublin, as we know, is expanding exponentially, as are south Dublin and west Dublin. We have to go where the population is. In some cases, we have to bring new post offices into service that did not exist before. It is not as if we are approaching these on a group basis. They end up being done on a group basis because we accumulate decisions in regard to them. Where we have engaged locally and we are looking at options, we are ensuring we maintain the postal service in that town or village in a suitable location. That is it in many of those cases. In some cases we need to manage this better by communication. Our local authority representatives need to be made aware of these changes because we do not want controversy around them or individual post offices.

The difficulty around this, as committee members will know from their own experience, is that the narrative gets distorted sometimes as to what the reason is and so on. We have to engage sensitively with current postmasters and postmistresses who want to get out for personal, family or other business reasons. We then have to look to others to see if they are willing to come in. We publicly advertised today around that. It is a sensitive, difficult commercial experience for those factors but I would like to think we do this in a responsible way. Compared with some of the banking entities, we are still the only cash provider, which we believe is very important. When we are making decisions on closures, which are limited enough among the post offices, we look for a new location as the primary alternative. That is the best way forward and that is what we engage in. It also depends on the footfall. I am originally from a rural town, Roscommon. There was a lot of controversy around Roscommon post office. I was back there for a school reunion last weekend and I walked around the town again. It has a vibrant business community and there were a lot of people out and about. It is vital that we have a post office there for a lot of reasons. It needs to offer a multiplicity of services. I am very conscious and aware of that.

When I am travelling in rural areas, I always go into the post office to find out what is going on and to buy a stamp. They would be wondering why I am in there or who I am. They might say they have never seen me before or something like that. I am always delighted to see the parcels stacked up. The other thing is that we have to supply security for the cash that is in there. That will be a big issue in the coming months with the delivery of the budget material. There is a lot there.

You must look at who your customers are. It is difficult to make that social decision. That is where Government policy and Government support for postmasters comes into play. If your primary customer base - 60% to 80% of customers - is of a certain age, is that a viable entity? As the Cathaoirleach has quite rightly said, that has to balanced against the interests of the citizen, which is paramount in those considerations. That is where the State has a role. That role can be done by trying to maintain the viability of the postmasters’ offering.