Branches are given £1.3bn extra cash

The Post Office is to receive £1.3bn in extra government funding over the next four years, the Business Secretary, Vince Cable, announced yesterday. The money will be used to reform the Post Office network, but Mr Cable said there would be no closure programme.

"The Post Office network is a cornerstone of British life," he said. "The [funding] will ensure that there is no new closure programme – but it will also allow the Post Office to invest, improve its offer and win new revenue streams."

Earlier this month, the Government commenced plans to privatise some or all of the Royal Mail, although it promised that 10 percent of the shares will go to the company's employees.

Mr Cable said Royal Mail could not modernise and survive if it remains in public ownership. He said the Government needed to move "faster and further" because its performance is declining in a shrinking market with email rapidly replacing paper letters.