Royal Mail “manipulation” findings presented by Postcomm

UK regulator Postcomm has issued a preliminary ‘minded to’ finding on its investigation into the alleged manipulation of quality of service performance monitoring by some staff at Royal Mail. Locations under scrutiny include the west of Scotland,  Glasgow, and also Belfast.

The regulator, responsible for issuing and enforcing all postal operators’ licence conditions, is ‘minded to’ conclude that Royal Mail has failed and is failing to comply since July 2006 with two parts of a condition of its licence  relating to quality of service.

The preliminary findings from a 10-month inquiry reveal that Royal Mail’s processes for monitoring  the measurement of its performance have been flawed resulting in the company failing to discover the problem for itself. Instead the issue came to light as a result of an informant approaching Postcomm.

However, Postcomm’s findings did not reveal any material difference to Royal Mail’s published quality of service figures over the same period.

Postcomm chief executive Tim Brown said: “This ‘minded to’ stage is an important part of our investigation process because it gives Royal Mail, or any other party, the chance to consider and respond to the detail of our findings before we make a final decision.”

The final decision is unlikely to be made before May. Following this stage, if Royal Mail is found to be in breach of its licence conditions, if appropriate, Postcomm would consider potential sanctions.

Royal Mail has co-operated fully and openly throughout the investigation.

To comply with one aspect of condition 4 of its licence (requiring an independent assessment of its performance monitoring), Royal Mail has contracted with a market research company called Research International to monitor its quality of service performance.

Another aspect of condition 4 requires Royal Mail to ensure that ‘panellists’ working for Research International should be anonymous. These members of the public/businesses send and receive ‘test’ letters through the post in order to record time and day of sending/delivery.

Detailed allegations of wrongdoing came to light in February 2009 when Postcomm was given evidence by an ‘informant’ who was an employee of Royal Mail.

The informant alleged Royal Mail staff, including senior managers, had managed to identify panellists working for Research International within Scotland’s Motherwell and other postcode areas and had put together a spreadsheet of their names and addresses.

The informant alleged these spreadsheets were used to ensure panellists received their letters in good time to ensure performance targets were met.

Postcomm’s investigation included gathering information from Royal Mail and Research International and assessing any impact on Royal Mail’s quality of service results in order to identify the extent of any breach of Royal Mail’s licence.

Areas of concern for Postcomm include the following:

  • Spreadsheets with panellists’ names and addresses were circulated among Royal Mail staff for a number of years. Employees, at various levels and in locations across Scotland and Belfast, were familiar with the system to identify panellists.
  • The ‘test’ items sent to panellists were designed to be easily identifiable by panellists but had also become recognisable to Royal Mail staff
  • Royal Mail’s corporate governance mechanisms did not identify these failings over a number of years

The relevant clauses of condition 4, of which we are ‘minded to’ find Royal Mail in breach, are as follows:

  • Condition 4.8 (a) (ii): to monitor its performance of each of the scheduled services and standardised measures, in relation to the scheduled standards using a testing methodology that is applied independently of the licensee
  • Condition 4.8 (a) (iii): to monitor its performance of each of the scheduled services and standardised measures, in relation to the scheduled standards using a testing methodology that is compliant with Article 16 of the Postal Services Directive (requiring anonymity of panellists).

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