An Post raising postal rates in April
An Post has announced that the standard domestic letter rate for items up to 100g within Ireland will increase from €0.72c to €1.00 while the standard international letter rate up to 100g will rise from €1.10 to €1.35. In a statement issued on Friday (16 March), An Post said that increases of between 12% and 39% across the full range of mail services were “necessary” in order for the post operator to continue to meet its Universal Service Obligation.
An Post’s CEO David McRedmond commented: “An Post is taking action to put the correct postal prices in place now. This will ensure the sustainability of the mails service for all customers and provide certainty of cash flow while we implement a fundamental restructuring of the whole business over the next two years.
“Across the world, postal companies have already taken action to deal with the challenges of a rapidly changing market and we must do the same. An Post delivers consistently excellent service and we must charge the correct price for this service. Mail continues to be an important, effective medium and even with these increased tariffs, still represents real value.
“Where the impact is greatest – on higher volume users such as SMEs and larger businesses – An Post will do everything possible to mitigate the impact through improved volume discounts.”
The An Post statement added that the company is currently conducting a “major strategic review of the scale, scope and structure of the Group for the long-term, taking into account major ongoing technology and market shifts”. The review is scheduled to be completed by May of this year.
As Post&Parcel reported last week, it is understood that An Post is likely to see a significant pruning of its network of 1,121 post offices when the review is published. Sources have indicated that 200 or even 400 post offices could be at risk of closure.
In related news, Ireland’s Commission for Communications Regulation (ComReg) announced today (21 March) that the Communications Regulation (Postal Services) (Amendment) Act 2017 has now been enacted – and it repeals section 30 of the 2011 Act and the current five-year price cap.
As a result, ComReg will no longer have any statutory power to regulate the prices of universal postal services on an “ex ante basis” (before the prices are increased).
What this means in practice is that An Post will be able to increase prices, without requiring any advance approval from ComReg, and ComReg cannot limit the size of such price increases. However, An Post will still have to comply with the “tariff requirements”(as set out in section 28 of the 2011 Act), which specify that prices have to be affordable, cost-oriented, uniform through the state, transparent and non-discriminatory. Furthemore, ComReg will continue to monitor An Post’s compliance, on an ex post (after the event) basis.
