Referral of the proposed Post Office Transformation Subsidy Scheme by the Department for Business and Trade
The Subsidy Advice Unit (SAU) has accepted a request for a report providing advice to the Department for Business and Trade (DBT) concerning its proposed Post Office Transformation Subsidy Scheme.
Administrative timetable
| Date | Action |
|---|---|
| 13 April 2026 | SAU’s report to be published |
| 11 March 2026 | Deadline for receipt of any third-party submissions |
| 26 February 2026 | Beginning of reporting period |
Request from the Department for Business and Trade
26 February 2026: The SAU has accepted a request for a report from DBT concerning the proposed Post Office Transformation Subsidy Scheme. This request relates to a Subsidy Scheme of Particular Interest.
The SAU will prepare a report, which will provide an evaluation of DBT’s assessment of whether the subsidy scheme complies with the subsidy control requirements (Assessment of Compliance). The SAU will complete its report within 30 working days.
Information about the subsidy scheme provided by the Department for Business and Trade
DBT is proposing to set up a new subsidy scheme which will fund Post Office’s Transformation Plan. This subsidy scheme will cover 2 areas of funding:
- Strategic Transformation Plan: initiatives include ensuring the network is fit for purpose, improving the company’s commercial offer, delivering a new operating model, resetting stakeholder relationships
- Future Technology Portfolio: transforming the company’s technology and data, which includes moving away from the outdated Horizon IT system and contract with Fujitsu
Via the Transformation Plan, Post Office aims to deliver a ‘New Deal for postmasters’, addressing sustained challenges faced by postmasters and equipping them with the tools they need to run a branch successfully, as well as improving remuneration.
DBT (also the sole shareholder of Post Office Limited) will continue to provide oversight of the company to ensure that these activities, and associated costs, are well managed. The subsidy scheme will be ringfenced for the purposes outlined above and may not be used for supporting other activities undertaken by the Post Office.
This subsidy scheme will cover financial years 2026 to 2027, 2027 to 2028 and 2028 to 2029. Spending approval of £483.4 million has been secured for financial years 2026 to 2027 and 2027 to 2028, and a provisional allocation of £125.9 million has been allocated for financial year 2028 to 2029, bringing the total size of the subsidy scheme to £609.2 million. Grant payments will be released monthly and will be subject to regular reporting from Post Office.
The subsidy scheme is being made in the context of a wider programme of funding. Previously, transformation activities and Horizon IT matters have been funded through separate subsidy awards, on which the SAU published reports in December 2023, April 2025 and July 2025. These 2 strands are now combined.
Information for third parties
If you wish to comment on matters relevant to the SAU’s evaluation of the Assessment of Compliance concerning the proposed Post Office Transformation Subsidy Scheme, please send your comments on the date stipulated in the timetable above. For guidance on representations relevant to the Assessment of Compliance, see the section on reporting period and transparency in the Operation of the subsidy control functions of the Subsidy Advice Unit.
Please send your submissions to us at sau-poltransformationscheme2026@cma.gov.uk, copying the public authority: postofficepolicyandfunding@businessandtrade.gov.uk
Please also provide a contact address and explain in what capacity you are making the submission (for example, as an individual or a representative of a business or organisation).
Notes to third parties wishing to make a submission
The SAU will only take your submission into account if it can be shared with DBT. The SAU will send a copy of your submission to DBT together with its report. This is to allow the public authority to take account of the submission in its decision as to whether to make or modify the scheme or its assessment. We therefore ask that you provide express consent for your full and unredacted submission to be shared. We also encourage you to share your submission directly with DBT using the email address provided above.
The SAU may use the information you provide in its published report. Therefore, you should indicate in your submission whether any specified parts of it are commercially confidential. If the SAU wishes to refer in its published report to material identified as confidential, it will contact you in advance.
For further details on confidentiality of third party submissions, see identifying confidential information in the Operation of the subsidy control functions of the Subsidy Advice Unit.
Contacts
- SAU project team: sau-poltransformationscheme2026@cma.gov.uk
- CMA press team: 020 3738 6460 or press@cma.gov.uk