Post Office 'to retain' POCA contract » Communities » 24dash.com

The Government was today set to end months of speculation over the future of a card account used by millions of people to receive benefits and pensions, giving an expected boost to the Post Office.

Work and Pensions Secretary James Purnell will issue a statement to the Commons at lunchtime which is expected to signal that the Post Office will retain the contract.

Subpostmasters, union leaders and MPs had warned that thousands of branches would close if the contract was given to a rival firm.

The contract for the Post Office Card Account was put out to tender, with PayPoint and another firm expressing an interest.

The Federation of SubPostmasters said 3,000 branches would close if the contract was not renewed, while leading Labour MP John McFall warned it could be double that.

The Department for Work and Pensions refused to confirm or deny that a decision had been taken, saying only that an announcement would be made "as soon as possible".

The card account contract runs out in 2010 and an announcement had been expected in the summer. The delay fuelled speculation that a rival firm would be given the work.

Two million people signed a petition and 265 MPs from all parties signed a parliamentary motion calling for it to stay with the Post Office.

Earlier this week Mr Purnell told MPs an decision would be made "very soon", but stressed that he must first go through all the necessary procedures.

He told the House of Commons: "The decision has to be taken in due order and I cannot take a decision before all the necessary options have been completed.

"The worst possible thing would be to take a decision which then got unwound."