AT LAST the Government seems to be listening on post offices. Grassroots initiatives up and down the country, including this newspaper's Counter Attack campaign, appear to have made their mark, resulting in the expected announcement today of a wide-ranging rescue package.

The local post office is a keystone of a community, often providing the only point of contact in many rural areas. Offices in urban areas are important too, offering convenient services close to where people live, rather than a bus ride away in the city centre.

Fears for the national network of post offices, particularly those in rural areas, have been mounting due to the plan to switch all benefits to direct payments after 2003. Supporters of local post offices have complained bitterly that if the offices no longer handle cash payments, then a big part of their business will be lost.

The suspected proposals from the Government appear to be forward-looking, with an eye on the bright future rather than the musty past. For while post offices are so valuable to so many people, it is true that many branches appear to exist a world away from the sort of modern shops people expect nowadays.

A clever part of the proposals is the suggestion that post offices should operate as banks, partly for the estimated 2.5 million people who do not at present have a bank account. So while post offices will be able to continue in their present role, they will also be encouraged to modernise and seize new business opportunities, using the Internet for e-commerce and handling mail order goods.

Government subsidies will also be available to support struggling post offices. While this suggestion will come as a great relief to some post offices, careful consideration should be given to any harm such subsidies could have on other local businesses.

Some of the suggested changes to local post offices may well seem futuristic and alien to traditional customers, yet the future often looks odd before it arrives. If the Government can pull off this difficult revival of a much-loved British institution, it will have done us all a favour.