Bill Cockburn, chief executive, said: 'The drive for efficiency will not in any way have an adverse effect on the services we provide to customers.'
Labour and the unions said services were bound to be impaired. Peter Hain, the Labour MP for Neath, who is sponsored by the Union of Communication Workers (UCW), said: 'These job losses will result in reduced quality of service to the public.'
The Post Office maintained that the 15,000 job losses in Royal Mail were aimed mainly at reducing overcapacity in sorting offices. London, which will bear the brunt of the cuts, has the capacity to process 6 million letters a day but is only handling 3.5 million.
The same number of postmen would still be needed for deliveries, the Post Office said, but the goal was to be able to machine-process all letters in sorting offices by 1995 as part of a pounds 1bn investment programme.
All the 1,200 jobs being shed in Post Office Counters will be among managerial and administrative staff. The restructuring would have no impact on the 20,000-strong network of post offices or staff working in them.
The Post Office added that it would be spending pounds 2m to recruit additional staff for post offices across the country.
Mr Cockburn also pledged that increased efficiency levels would help keep prices down. The cost of first and second-class stamps has been frozen since September 1991, and will not rise until March.
Mr Cockburn said there might be scope to extend the price freeze further through cost savings.
Mr Hain said the job cuts were the result of the Post Office being slimmed down for privatisation. Michael Heseltine, President of the Board of Trade, is expected to announce the go-ahead for the sale in the new year.
However, Post Office executives maintain that standards of service and the rural post office network will be under greater threat if the Post Office is kept in the public sector and prevented from expanding services.
The Post Office estimates that up to 3,000 rural outlets could be forced to close unless it is given the freedom to sell a wider range of goods and services. It has been given approval to bid for the right to manage the National Lottery and sell tickets, but it also wants to be allowed to provide other services such as insurance.