Report seeks break-up of Post Office
THE Post Office should be split into two divisions and its distribution
business privatised as soon as possible, according to a report from the Centre for Policy Studies published today. Author Stuart Lyons says the Post Office delivery business is not able to compete with big logistics businesses because of the Post Office Counters business. He claims: “Post Office Counters is less and less anything to do with the distribution business. The synergies between the two businesses are not there, and the counters business is holding back the
company’s efforts to modernise itself.” Mr Lyons says it is also vital to
privatise the Royal Mail and Parcelforce business, which is currently run as
a company with the government as the only shareholder. “Too many people are
trying to develop its strategy,” he adds. “It won’t work while the Post Office is part of the government because it is held accountable by the standards of the
Treasury, and not by the standards of business.” The Post Office, which is
changing its name to Consignia, is trying to modernise itself in an attempt
to compete with private carriers. The Government has appointed a regulator
called PostComm, and the Post Office must apply for a licence to carry out the
activities it currently undertakes. It also looks set to lose its monopoly
on delivering items under pounds 1. The Post Office has argued that it cannot
compete if that monopoly is removed completely, because of the expense of
providing a universal service across the country for one standard tariff.
However, Mr Lyons says there is no indication that this is the case. “The
Post Office simply has to provide this service,” he argues. “It’s like a company
in the china business, who may make a lot of money selling cups and saucers,
and less selling matching vegetable dishes. “If companies want to operate in a
territory they should take the rough with the smooth. Royal Mail is
currently a profitable business.” Mr Lyons was formerly chief executive of Royal
Doulton.
DAILY TELEGRAPH, 19th March 2001
