Post Office chiefs have put corporatisation plans on the backburner to focus on commercial challenges, after it was revealed mail volumes had halved in a decade.

Julie Edge, the Post Office chairman, has dropped a planned consultation on corporatisation and admitted there are other priorities.

The concept of turning the Post Office from a statutory board to a company, wholly owned by the government, has been on the agenda for years.

Tynwald rejected many of the recommendations in the report submitted by the then board of the Post Office, but agreed to a key one, which was for articles of association to be brought forward for approval.

Ms Edge said: ’As the core services of the Post Office continue to decline - mail volumes have halved in the past 10 years - the challenge for the business is to ensure it remains profitable and is able to continue to provide a dividend back to Treasury.

’I believe it is essential that the Post Office focuses on its commercial activities in order to continue to support its important social services in the community, in order to ensure it does not require a subsidy from government in the future.’

It was those issues, along with impending pension scheme changes, that were the key challenges, she said.

Further discussion on corporatisation and proposed public consultation be ’postponed for the foreseeable future in order to allow the Post Office to focus on these key challenges and its future strategy’.

The Post Office is preparing a five-year strategy that would ’more accurately reflect our current challenges with a vision to develop a sustainable and modern Post Office in the long term, and for it to remain self-funding’.

David Ashford (Douglas North) welcomed the news after Ms Edge gave a statement to Tynwald last week.

He asked her to conform that ’for the foreseeable future, it means corporatisation is dead in the water’.

Ms Edge (Onchan) did not answer the point directly, but said: ’We have already arranged a meeting with our sponsoring department (Treasury) in February, to bring forward the strategy so that they can review it, and then we are seeking to have a review with CoMin to present the strategy at that.’

She admitted the Post Office had lost some ’major commercial clients’ in the past year.

In November, Ms Edge revealed the island’s sub-post office network made a £1.5m loss last year.