Referral of the proposed subsidy Post Office IT Interim Funding by the Department for Business and Trade
The Subsidy Advice Unit (SAU) has accepted a request for a report from Department for Business and Trade (DBT) concerning its proposed subsidy to Post Office Limited (POL).
| SAU referral type | Mandatory Referral |
|---|---|
| SAU referral State | Closed |
| Sector | Distribution and Service Industries |
| SAU referral opened | 26 October 2023 |
Administrative timetable
| Date | Action |
|---|---|
| 7 December 2023 | SAU’s report published |
| 10 November 2023 | Deadline for receipt of any third party submissions (submissions after 5pm on this date cannot be taken into account) |
| 26 October 2023 | Beginning of reporting period |
Final report
29 November 2023: The SAU has published its report providing advice to DBT concerning the proposed subsidy for Post Office IT Interim Funding. The report sets out our evaluation of the DBT’s Assessment of Compliance of its proposed subsidy with the requirements set out in the Subsidy Control Act 2022.
- (7.12.23)
Request from DBT
26 October 2023: The SAU has accepted a request for a report from DBT for its proposed subsidy to Post Office Limited (POL). This request relates to a Subsidy of Particular Interest.
The SAU will prepare a report, which will provide an evaluation of DBT’s assessment of whether the subsidy complies with the subsidy control requirements (Assessment of Compliance). The SAU will complete its report within 30 working days.
Information about the subsidy provided by DBT
Post Office Limited is a Public Non-Financial Corporation (Public Corporation). It was constituted under the 2000 and 2011 Postal Services Acts and is wholly owned by the Secretary of State for Business and Trade. Through Post Office Limited, Government ensures the provision of a network of Post Office branches, delivering essential services to customers across the UK. Government provides an annual ‘Post Office Subsidy Award’ and has periodically provided ‘Post Office Investment Funding’.
The Department for Business and Trade is proposing to award Post Office Limited a grant of up to £122.7m, including £19.7m contingency, to enable the company to continue to invest in its IT systems. Specifically, this subsidy will contribute towards enabling Post Office Limited to maintain the current IT platform (Horizon) while undertaking work to continue the development and rollout of the New Branch IT System (NBIT) that will replace Horizon.
Government considers that it is important that Post Office Limited has a reliable IT system and is therefore proposing to provide additional financial support. By extension, it is intended that this investment will also support the provision of a stable Post Office Network, providing essential services to customers across the UK.
The Department for Business and Trade, which is also the sole shareholder of Post Office Limited, will continue to provide oversight of the company to ensure that these activities, and associated costs, are well-managed. The subsidy will be ringfenced for the purposes outlined above and may not be used for supporting other activities undertaken by the Post Office. The grant funding will cover the period to the end of FY2024/25. Grant payments will be released quarterly and will be subject to regular reporting from Post Office.
Information for third parties
If you wish to comment on matters relevant to the SAU’s evaluation of the Assessment of Compliance concerning DBT’s proposed subsidy to POL, please send your comments before 5pm on the date stipulated in the timetable above. For guidance on representations relevant to the Assessment of Compliance, see the section on reporting period and transparency in the Operation of the subsidy control functions of the Subsidy Advice Unit.
Please send your submissions to us at SAU-PostOfficeITSubsidy2023@cma.gov.uk copying the public authority at glocompensation@beis.gov.uk
Please also provide a contact address and explain in what capacity you are making the submission (for example, as an individual or a representative of a business or organisation).
Notes to third parties wishing to make a submission
- The SAU will only take your submission into account if it can be shared with DBT. The SAU will send a copy of your submission to DBT together with its report. This is to allow the public authority to take account of the submission in its decision as to whether to grant or modify the subsidy or its assessment. We therefore ask that you provide express consent for your full and unredacted submission to be shared. We also encourage you to share your submission directly with DBT using the email address provided above.
- The SAU may use the information you provide in its published report. Therefore, you should indicate in your submission whether any specified parts of it are commercially confidential. If the SAU wishes to refer in its published report to material identified as confidential, it will contact you in advance.
- For further details on confidentiality of third party submissions, see identifying confidential information in the Operation of the subsidy control functions of the Subsidy Advice Unit.
Contacts
- SAU project team: SAU-PostOfficeITSubsidy2023@cma.gov.uk
- CMA press team: 020 3738 6460 or press@cma.gov.uk
Updates to this page
Published 26 October 2023Last updated 7 December 2023 + show all updates
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Final report published
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First published.