The Government has approved the introduction of a national postal code.

The Minister for Communications said tenders for the design and implementation of the system will be issued shortly.

Minister Ryan said he expects new postal codes with digits and letters to be introduced in 2011.

A Government-commissioned report said codes would provide long-term savings and demographic details for planning as well as benefitting emergency services.

An Post said it will be playing a key role in the move to postal codes which will involve coding 1.7m addresses.

In 2005, the then Minister for Communications, Noel Dempsey, promised a new system by 2008. At the time An post questioned the need for postal codes and industry experts put the cost at €50m.

However, Mr Ryan today said the move would cost a fraction of that estimate.