Pat Rabbitte (Dublin South West, Labour) | Oireachtas source

The problem is that An Post's mandate is that of a commercial State company. It is not always possible to reconcile that with a mandate to shore up the post office network. The post office network is a combination of private enterprises which are subject to EU competition and procurement law. Deputy Moynihan is correct that there is a dilemma here. The dilemma is best highlighted in the context of the point he raises about the social welfare contract, which is worth approximately €58 million to the postal network. The dilemma is how to migrate the contract to electronic transfer of funds and protect the incomes of postmasters.

While I understand fully why postmasters would want to protect their incomes, I also appreciate why there is an imperative from the point of view of the Department of Social Protection to make savings in the delivery of its services wherever possible. For example, the average income from the social welfare contract for postmasters, who might well have other business, was €37,000 per annum at the height of the boom in 2004. Last year, the average was €68,000 per annum. That is because the social welfare contract provides for a fee per transaction coupled with the explosion in unemployment since the economic crash. Clearly, incomes significantly increased on foot of the fee per transaction arrangement.

I have made the points Deputy Moynihan makes to An Post's senior management, who have pointed out to me that they had to take €70 million out of payroll costs and €30 million out of non-payroll costs in the same period that the incomes of postmasters increased significantly for the reasons I have outlined. We must reconcile the dilemma between seeking to protect the incomes of postmasters and the need for the Department of Social Protection to efficiently and most effectively deliver its service to its clients.

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