Tentative steps towards (UK) competition

Postwatch, the watchdog for postal services, notes that Postcomm has published further details of its postal market licensing system.

From 1 January 2006, licensed operators will be able to collect, sort and deliver mail to customers. Postcomm, the postal services regulator, today set out in three decision documents details of:

· The licensing framework that will apply to postal operators other than Royal Mail;
· A code of practice protecting ‘mail integrity’, for example security of post, and staff recruitment; and
· Common operating procedures, such as how competing companies should work together on a number of issues, such as misdirected mail.

Of particular importance is the mail integrity code of practice. The recent Channel 4 Dispatches programme showed security breaches e.g unvetted, untrained agency staff being told to sort a delivery round without sufficient training or supervision.

Theft of mail and staff recruitment policies remain issues of concern for customers.

Commenting on the announcement today, Peter Carr, Chairman of Postwatch, said:

“Opening up the UK postal market to competition will bring benefits to customers, including increased choice, improved quality of service and the possibility of lower prices. Essential to consumer confidence is that all postal operators – including Royal Mail – are reliable, with rigorous employment policies, taking all necessary steps to safeguard against theft and loss of mail.

“Postcomm has failed to include in the mail integrity code of practice an obligation on postal operators to advise customers when mail is stolen. This is a missed opportunity. If a postal operator fails to provide the service which has been paid for, the postal operator must inform the customer. Failure to do so will do nothing to help build confidence in the postal service.

“Despite such shortcomings, the code of practice represents a solid foundation for customer protection and gives clarity to what is demanded of postal operators. It remains to be seen if the existing licensed operators find these proposals acceptable – their agreement is required.”

Notes to Editors

1. Domestic customers are unlikely to be able to post mail using another operator in the near future. Business customers are expected to be earlier beneficiaries of a liberalised postal market.

2. Since January 2003, private companies have been able to compete with Royal Mail in the bulk mail market (over 4,000 items). This represents 30 percent of the market currently already being open to competition. Royal Mail still has over 99 per cent market share.

3. Postwatch’s response to each of the three Postcomm documents can be found at
www.postwatch.co.uk under Policy section