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Last Updated: Wednesday, 18 October 2006, 13:58 GMT 14:58 UK
PM challenged over post offices
Postmasters rally in London
Postmasters gathered in central London for a rally
Conservative leader David Cameron has challenged the prime minister to do more to protect post offices.

He spoke as subpostmasters held a London rally and handed in a petition signed by four million people, calling for rural post offices to be saved.

Mr Cameron said the plan to scrap Post Office card accounts could deal a "fatal blow" to the rural network.

Tony Blair said people were changing the way they used post offices, and there could be no extra subsidies.

There are more than 14,000 post office branches in the UK, roughly divided between rural and urban areas and down from more than 18,000 in 1999.

Campaigners say a further 6,000 are under threat, with the current 150m-a-year subsidy for the rural network due to be withdrawn in 2008.

The government says the 800 smallest post offices are used by an average of 16 people a week.

The government is effectively not listening to the wishes of some of the most deprived people in the country
Roy Brooks, Doncaster subpostmaster

At Prime Minister's Questions, Mr Cameron said ministers could do more for post offices by protecting the Post Office card accounts, which are used to access pensions and benefits but set to be withdrawn.

But Mr Blair said: "The reason there is a problem is that more and more people are using bank accounts rather than the post office.

"It is important therefore to realise there is a process of change that any government would have to handle.

"So yes of course we will look at all the options, but what we won't be able to do is say there is even more subsidy available than the money we're already putting in."

'Crunch time'

Trade and Industry Secretary Alistair Darling, who is due to make a statement to Parliament in the next few weeks, said doing nothing was not "sustainable" and the Post Office needed to adapt.

Despite subsidies of 150m, post offices lost 111m in 2005
Postcomm estimates 1,500 of 8,000 rural post offices make money
72% of subpostmasters are uncertain about the future, says Postcomm
Revenue from services withdrawn from post offices fell 168m in past year

He said many of the services once offered exclusively could now be done elsewhere - for example, people were now able to buy road tax online, 98% of new pensions were paid straight into people's bank accounts, and TV licences could no longer be bought at post offices.

It was "inconceivable" there would be no subsidy of post offices, but the amount would depend on the final decision on the future shape and size of the network, he said.

The National Federation of Subpostmasters, which was handing in the petition, says it is the biggest domestic petition to be handed to Downing Street.

After handing in the petition, general secretary Colin Baker said the prime minister had said he knew the issue was "urgent".

I want to maintain a national network, but I want to do it in a way that will last
Alistair Darling

"Certainly four million signatures on a petition has attracted the prime minister's attention," he said. "I think that's something that you can't really ignore."

He said it was "crunch time" for post offices, and called on the government to build on Post Office card accounts, rather than reduce services.

"The 28 million customers who use the Post Office every week are confused as to what the government wants of the network and of the people who run it," he said.

"We believe that the time is now overdue for ministers to decide."

Almost 400 MPs have signed an early day motion calling for the decision to withdraw the Post Office card account to be reversed.

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