Postmasters have called for the end of an agreement which cuts their lottery profits by 20% after it emerged that the Post Office was letting new entrants to the network opt out.

The historic arrangement sees postmasters earn just 4% of every ticket or scratchcard sale – compared to the 5% earned by other retailers.

The remaining 1% goes to the Post Office in return for it handling payments with Camelot through its accounting system.

For postmasters selling £2,000 worth of lottery products per week, 1% represents £1,000 per year.
Several postmasters have told Retail Newsagent that it is time to end the 1% agreement because it no longer reflects increased revenue and the work being done at retail to help grow sales.

They say that the opt-out clause being offered to existing Camelot retailers taking on post office services through network transformation should be extended to every branch offering lottery products.

Bimal Patelia of PS News in south London said: “The Post Office has been creaming off our lottery profits for far too long. We put the tickets out and handle the PoS and upsell all the big games – not the Post Office.

“The fact that new entrants like WH Smith won’t give up 1% shows how unfair this is.”

The revenues from the lottery have grown, but the work the Post Office does is the same and it can’t justify that any longer

Saf Sathi of Singlewell Post Office in Kent said: “The revenues from the lottery have grown, but the work the Post Office does is the same and it can’t justify that any longer.”

Gravesend retailer Harry Goraya said: “It either needs to be scrapped altogether or cut to 0.5% to reflect how much work each party does.”

A Post Office spokesman said: “Post Office operators running Camelot terminals in conjunction with Post Office Ltd receive support, for example, with the supply of cash and stock, and we believe our commercial arrangements with our postmasters fairly reflect this.”

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