Israel cuts some postal rates
The Knesset Economics Committee today authorized an average 1.2% lowering of the Israel Postal Authority’s rates. The new rates will become effective on September 1. The NIS 1.20 rate for ordinary letters in Israel, which account for a third of the Postal Authority’s revenue, will not be changed.
On the other hand, bulk mail rates will be reduced by 5.2 while rates for most other services will be raised 1.2%. The cost of an ordinary telegram sent through a postal branch or by telephone will rise from NIS 31.20 to NIS 36. At the request of committee chair MK Avraham Poraz (Shinui), the rate for illustrated greeting cards will not be raised.
The committee also approved a gradual rise in the rate for packages by NIS 2 per year for the next three years, except for packages sent to soldiers, for which the rate will not be changed. This decision is intended to facilitate competition with private businessmen and prevent cross-subsidization of prices.
In addition, the committee approved the elimination of the arbitrary and artificial distinction since the beginning of the previous decade between advertising and bulk mail. The committee reduced the maximum discount bracket for bulk mail from two million units per year to 400,000 units, so that medium-sized competitors can also benefit from the minimum price of NIS 0.84 per unit, a 30% discount on the NIS 1.20 rate.
At the end of the committee session, Poraz announced that the committee would hold a discussion at the beginning of next month on the opening of postal services to competition. Minister of Communications Reuven Rivlin announced he would begin issuing permits to private operators to facilitate the reform only after the committee held its discussion. He said he would ask the committee’s approval for further average 4% postal rate reduction in January 2003.
