ČTÚ wants to propose to the government a reduction in the number of post offices by 300 to 2,900

ČTÚ wants to propose to the government a reduction in the number of post offices by 300 to 2,900

ČT&Uacute wants to propose to the government to reduce the number of new branches by 300 to 2900

Czech Post branch. Illustration photo

Prague – The Czech Telecommunications Authority wants to propose to the government a reduction in the number of Czech Post branches from the existing 3,200 by 300 to 2,900. The reduction should concern municipalities with more than 2,500 inhabitants, and conversely should not affect rural areas. The reason is the declining interest in basic postal services, which was further accelerated by the coronavirus pandemic, and the associated unprofitability of the branch network. This follows from the proposal that the office sent to the interdepartmental comment procedure. The minimum number of branches is determined by the government by its regulation.

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The proposal is based on a market review carried out by the regulator in 2021. It showed that due to ongoing digitalization, the volume of letter shipments continues to decrease, and at the same time, the pandemic caused the rapid development of e-commerce and, with it, new forms of delivery, for example to self-service delivery boxes. Alternative operators of postal services began to assert themselves in the market with increased intensity and came up with an offer of commercial services that better corresponded to the changed requirements of users.

According to the proposal, the cancellation of 300 branches will mean a reduction in the net costs of providing basic services that the post office requests from the state every year. The postal service regularly calculates costs at around 1.8 billion crowns, but according to the law, it can receive a maximum of 1.5 billion crowns from the state.

According to post spokesman Matyáš Vitík, the unprofitability of the branches is due to the fact that the capacity and scope of the postal infrastructure, which correspond to the parameters of the applicable legislation, do not correspond to the demand for the services that the Czech Post is required to provide by law. It is about delivering letters, paying vouchers and the like. These products have been in extreme decline in recent years, mainly due to digitization, covid and other legislative changes, such as the DEPO Act. Specifically, by 40 percent over the last four years. The number of transactions at all post offices was a total of 215 million in 2018, compared to 147 million last year.

“There are two solutions. Either additional financial resources will be spent, or the capacity will be adapted to needs. And the CTÚ together with the Czech Post chose the second method, which will continue to ensure sufficient availability of services in a comfortable quality even with a reduced number of branches,” said Vitík.

According to Vitík, the Post Office is able to ensure the availability of postal services even with a reduced number of branches. “It is valid that the possible cancellation of branches will not affect small towns, rural areas and municipalities where there is currently one post office in operation. The possible cancellation of branches would have an impact on the number of Czech Post employees,” he added. Of the 3,200 currently operating branches, 800 are Partner post offices, which are served by municipalities or private individuals. These would not be affected by any interference.

In recent years, Czech Post has been operating in the red. Last year, it reduced its loss by half to 681 million crowns. In the previous year, it reported a drop of 1.37 billion crowns.