An Post has confirmed that its financial position has significantly worsened in recent months and that it could face losses of as much as €50 million if radical action is not taken immediately.
The company is seeking to lay off as many 1,500 workers over the next two years as part of a restructuring and cost-cutting plan. It had previously sought 1,100 redundancies but a number of factors have led the company to seek more stringent cost-cutting measures.
An Post management met with unions and workers today to explain the worsening situation. ireland.comunderstands management are blaming the economic downturn and delays in implementing a postage stamp price rise.
It is understood other factors such as expected economies from automation and other cost-saving measures have been slow to filter through.
An Post recorded its biggest operating losses of €70.5 million in July this year, though over €50 million was an exceptional restructuring charge.
The communications regulator ComReg recently granted An Post a 7 cent increase in postage stamp prices estimated to be worth €18 million a year. However, workers and unions were told today that the company is still facing a €30 million shortfall.
The news follows the revelation in the Irish Timestoday that the Minister for Communications, Marine and Natural Resources, Mr Ahern, sent a strongly-worded letter to the chairwoman of An Post critcising the company for not keeping him informed of the worsening financial situation.
In the letter, delivered yesterday morning to Ms Margaret McGinley, Mr Ahern gave the board four weeks to produce a report outlining how the situation had deteriorated over such a short period of time.
The letter is reported to complain that the latest figures were "substantially worse than the budgetary information supplied to me and my officials".
But Labour spokesman Mr Tommy Broughan said the Minister must take some of the blame.
"The threat of redundancies at An Post has been apparent for some time, yet nothing has been done to prevent them or to make the company more efficient, " Mr Broughan said.
Fine Gael communications, marine and natural resources spokesperson Mr Simon Coveney joined Mr Broughan in expressing concern for those likely to lose their jobs.
He also called for An Post management to be brought before the Oireachtas Communications Committee to outline its restructuring proposals and how they will affect both workers and the public.