Postcomm report points to improvement in Royal Mail service

Royal Mail today welcomed the decision of the postal regulator Postcomm not to fine the company for a dip in quality of service during the autumn and winter of 2003/2004, or to impose compensation payments beyond those historically agreed.

A report issued today by Postcomm:

· says the main factors adversely affecting service were industrial action at the end of 2003 and a serious fire at a mail centre a year ago – and that Royal Mail “did all it reasonably could” to reduce the impact of those events on customers,
· applauds the “extensive and effective action” by Royal Mail to restore service quality – currently running at the best levels in a decade,
· acknowledges the operational changes made by Royal Mail were right – both for the business and its customers,
· confirms that no further compensation payments are due to customers beyond those previously agreed,
· confirms that Royal Mail has already paid £43 million in direct compensation for the dip in service to business and private customers in the year to March 2004. The bulk of the money was paid by last summer while a further £17 million is being returned through adjustments to the price control for the financial year due to end in ten days’ time.

Royal Mail’s Chief Executive Adam Crozier said: “The report from Postcomm looks back. Royal Mail is looking forward.

“While lessons have been learnt and there is still more room for improvement, Royal Mail has already transformed the quality of service for its customers. Our most recent performances are among the best in a decade. We owe that to our people and we are delighted that Postcomm recognises that achievement.

“A year ago we promised that quality of service would always be at the top of our agenda and that the dip in quality at the end of 2003 and in the early part of 2004 would be temporary. We have succeeded in meeting that promise.

“We’re absolutely confident that in the winter of 2003/2004, which is the period covered by Postcomm’s report, we did everything in our power to handle massive changes to our operations with as little disruption as possible to our customers. Our postmen and women successfully implemented changes in the transportation, sorting and delivery of the mail – changes which have been vital in Royal Mail’s return to profitability and to improving quality of service to its best levels in almost a decade,” added Mr Crozier.

Royal Mail also announced today it had decided to extend its credit terms to business customers from 21 days to 30 days in a further move to enhance its customer offering. The move underpins Royal Mail’s continued drive to put the customer at the heart of the business.

Mr Crozier added that the key issue for customers, and for Royal Mail’s people, is sustaining and further improving the already high quality of service levels the company has achieved in recent months.

“Competition has arrived and from next January the UK postal market will be fully open. We are confident our customers will stay with Royal Mail because we will demonstrate that we are the best in that market. Our postmen and women have already achieved a fantastic improvement in Royal Mail’s performance. I am certain that, working together, we can achieve much more,” he said.