Government wants children to save with Post Office (From This Is Wiltshire)

Government wants children to save with Post Office

11:10am Wednesday 31st March 2010 in Latest News

CHILDREN in Swindon will be encouraged to save their pocket money in Post Office accounts under a Government plan to transform the network into a neighbourhood banking service.

Ministers hope the Children’s Savings Account, which will be introduced over the next 12 months, will help bring more customers to sub-post offices in the wake of the national closure programme that culled several Swindon branches.

Business Secretary Peter Mandelson yesterday announced £180m of new Government funding for the Post Office in 2011/12 to maintain the network around its current size.

The cash will go beyond the £1.7bn that is already being invested between 2007 and 2011.

Unveiling his rescue plan, Lord Mandelson announced that the Post Office would offer first-time buyers mortgages for a deposit of just 10 per cent and would double the amount it lent to customers over the next year.

The Post Office would also offer customers access to accounts with other banks, and a new account would be launched – known as a Saving Gateway– to encourage workers on lower incomes to start saving, with the Government adding 50p for every £1 deposited.

The push to expand financial services follows pressure on the Government to secure the network’s future after 2,500 branches, including 36 in Wiltshire and West Berkshire, were earmarked for closure by the Network Change programme, launched in 2007.

Nationally, about 11,500 branches survived the programme.

Lord Mandelson said: “Since the global banking crisis we have set about re-inventing the financial services industry piece by piece, building a system that is fairer, trusted and more responsible.

“Today is the next step in that process. The Post Office is a well-loved community institution and this move will bring more banking services back to the heart of those communities.”

George Thomson, the general secretary of the National Federation of sub postmasters, said: “While the Government’s proposals for financial services at the Post Office are a potential significant next step, we repeat our concern that more needs to be done to safeguard the future viability of the post office network.”

Shadow Business Secretary Ken Clarke said: “We welcome any plans to offer new services through the Post Office but this is all too little, too late.

“Labour have had 13 years to reform the Post Office, but have allowed it fall into decline with more than 6,000 closures as a result.

“Conservatives will prevent the closure of any profitable post office, reform the Post Office Card Account to help with utility bills, free up sub-postmasters and allow branches to offer a wide range of business services.”