Post Office says Treasury threatens profit

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The Independent Online
THE Post Office made record profits last year but warned that it could go into decline unless the Government gives it more commercial freedom, writes Mary Fagan.

Bill Cockburn, chief executive, gave no figures for the year to March 1994, to be announced in June. But he said that the Government's spiralling demands for cash are in danger of milking the organisation dry.

The Post Office, which is awaiting the outcome of a two-year government review, made a pre-tax profit of pounds 283m in the year to 31 March 1993 and paid the Treasury pounds 80m. It must pay pounds 181m to the Exchequer this year and pounds 226m in 1994/95.

Mr Cockburn said more letters were posted last year than ever before. But pillar box posting is flat with the overall growth attributable to bulk posting by business - an area where the group is most vulnerable to competition.

He has repeatedly called for more freedom for the Post Office to raise private-sector finance, to form joint ventures and to expand overseas. He also wants more freedom for the 20,000 post office counters around the country to be allowed to diversify into activities including travel and ticket sales.