The Post Office has dished out almost £10m to postmasters in extra remuneration under its new work incentive scheme.
The initiative, called Operational Excellence Incentive (OEI), which kicked off in August, is an opportunity for postmasters to earn up to 5% more of their monthly paycheque by hitting operational requirements such as daily cash declarations and cash pouch remittances.
September marked the first time postmasters received a boost in their pay, based on August’s trading activity, with 83% of branches qualifying. The average payout was 3.5% of their monthly earnings, while 2,960 branches, of the 11,500 overall, received the full 5% payment.
The Post Office has continued to reward postmasters every month since, with £9.6m paid out overall.
March has marked the most successful month so far, with 93.6% of postmasters qualifying and the average payout exceeding 4% for the first time. April’s performance saw 92.9% of postmasters receive a cash boost, with the average payout working out at 4.04% of their monthly earnings.
In comparison to their performance in April 2024, before the work incentive scheme was introduced, it would have seen just 86.8% of branches qualify.
“We are pleased that the average payment to postmasters our partners has risen steadily since the OEI was first introduced late last year,” Post Office head of postmaster remuneration Paul Liddiard told The Grocer.
“It rewards postmasters for completing essential back-office tasks, whilst at the same time reducing the amount of excess cash being held out in our network. The incentive has also reduced cash discrepancies, thereby saving postmasters time and helping them to continue focusing their time on serving customers.”
Transformation Plan
While the OEI was introduced before the Transformation Plan was announced in November, which is expected to give postmasters up to £120m in additional pay by March 2026, the Post Office said the OEI still formed part of its strategy to boost postmaster remuneration.
The Transformation Plan, which will deliver a ‘New Deal for Postmasters’, includes the new banking arrangement for postmasters, which will extend essential cash services in branches nationwide from January 2026 to December 2030, as well as cutting costs and restructuring to sustainably finance the business long term.
“Improving postmasters’ remuneration is a critical focus for the Post Office as we deliver a ‘New Deal for Postmasters’,” added Liddiard.
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