A £1.3 billion boost to protect the Post Office network has been unveiled by ministers as plans to sell off the Royal Mail cleared their first Commons hurdle.
The money, which will be made available over the next four years, would be used to reverse years of decline in the network, Business Secretary Vince Cable said.
But unions warned the extra funding could be wasted if the Royal Mail was separated from the Post Office under the coalition's plan and Labour said privatisation was not in the "national interest".
The Postal Services Bill was given a second reading by 321 votes to 238, Government majority 83.
Business Secretary Vince Cable said the £1.34 billion over the course of the spending review period "will be used to reform the current network, to change the underlying economics and so reverse the years of decline and secure its long-term future."
He added: "There will be no programme of closures under this Government and the Post Office will be able to invest, improve its offer and win new revenue streams."
The Government was looking at options for a cooperative structure for the Post Office network, which had around 11,500 branches across the UK. However, "no firm decision" had been taken on possible mutualisation but the Government had asked Co-operative UK to look at the options.
Mr Cable said the Royal Mail was facing "structural decline" with a huge fall in letter volumes and stiff commercial pressures, adding: "The Government is the wrong shareholder for this company.
"Given the Government's financial constraints we cannot invest enough, quickly enough, we can't invest flexibly enough and every investment we now make has to be cleared by the European Commission under state aid rules."
Mike O'Connor, chief executive of Consumer Focus, said: "Government support for our Post Office network is very welcome but its long term future can only be secured if Post Offices provide the services consumers need at a high standard in places people can access. At the moment, we love our Post Offices more than we use them."