The Post Office (PO) has announced a further £53m increase in postmaster remuneration to be paid by the end of the year. This will form part of its ongoing pledge to boost branches’ pay by “up to £120m”.

In an update on the remuneration target sent to branches today and seen by Better Retailing, PO chair Nigel Railton said he could “confirm the additional remuneration for the remainder of the year”, equalling £53m.

This includes £18m generated from “rate increases since April and the full year impact of the Operational Excellence Incentive are forecast to deliver £18m in additional remuneration this year”. A further £17m is forecast to come from increased marketing investments, with the message to branches saying: “We will be making a step change in marketing investment in the coming months that is projected to drive a £17m remuneration increase”.

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Another tranche of £18m will come from PO’s recent new banking framework, which will be paid out evenly over the remaining ten months of the current financial year.

The news comes as Better Retailing understands PO held a town hall meeting in Chesterfield today.

“We recently landed our new deal with the banks, and we have improved our terms with other providers too. That means we can afford £18m of further top-ups, which will be paid evenly over the remaining ten months of this financial year.” Railton’s update said, adding: “This equates to a total of £33m in top-ups already paid and a further £53m of additional remuneration”.

The news comes on the same day that PO announced the signing of an exclusive partnership with Western Union to provide money transfer services in branches.

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In the message, Nigel Railton said that by the end of the 2025/2026 financial year, remuneration will equal £86m, a 21% increase. The £33m already paid out includes £20m paid in December, and “top-ups” in April and May of £6m and £7m respectively.

Referring to the backdrop of this pledge, Railton said: “In the last financial year, postmaster remuneration totalled £405m. That was unsustainable for [postmasters]. At the launch of our Transformation Plan I said we wanted to improve postmaster remuneration by up to £120m this year, which is a 30% increase year-on-year”.

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