UK Regulator rebuffs Royal Mail attacks
The postal services regulator has rebuffed Royal Mail’s attacks on its proposed price controls, dismissing the company’s warning it would be sent into a spiral of decline as “only to be expected”.
Sarah Chambers, the chief executive of Postcomm, told a London conference the regulator did not intend to relax its proposals simply because of the Royal Mail’s intense lobbying. Ms Chambers said the watch-dog was prepared to listen to new evidence during
the consultation on the proposals, which are due to be finalised in November. But she added that Postcomm’s financial analysis of Royal Mail was based on “evidence we’ve extracted – and it does feel like extraction sometimes – from Royal Mail”.
Royal Mail has condemned the proposals as a “kick in the teeth” after its success in turning round the company from losing Pounds 1m a day in 2002-03 to an operating profit of Pounds 537m in the last financial year. Stephen Agar, director of regulatory affairs and wholesale at the Royal Mail, told last week’s conference the message the watchdog was sending his company was “quite clear: we think you should be making half the profits you’re making”.
Alan Johnson, the trade and industry secretary, is due to appoint a special committee to review Royal Mail’s future before parliament rises for the summer recess on July 21.
