The National Federation of Sub-Postmasters estimated at least 3,000 post offices would have been forced to close within 16 months if the contract was lost.
The decision was a triumph for the campaigners who have fought to save the Post Office Card Account, and a humiliating U-turn for the Government.
I received masses of post cards from constituents worried about this risk to their local post office, hard on the heels of the closure programme earlier this year. I have campaigned actively on their behalf for this result, both in the constituency and in Parliament through my position as Secretary of the cross-party Post Offices group.
The whole tender process for the Post Office Card Account has been a waste of time and money, and has been extremely destabilising for post offices which are struggling to survive. If the Government is cancelling the tender, why on earth did it set up a competition in the first place?
The Irish government recently awarded a similar contract without a contest, so there was a clear EU competition rules compliant precedent.
The whole process has been yet another example of dither, delay and turf battles within and between Government departments.
I hope now the Government will concentrate at last on helping post offices by providing more Government services and opportunities for customers to use their card through the remaining post office network.
