Author: Archive

Royal Mail faces the prospect of having to pay Pounds 800m a year to fill the hole in its pension fund that was revealed last year, the group announced yesterday. There was a contributions holiday at Royal Mail’s pension fund, the fifth biggest in the UK, from 1990 until 2003, when an actuarial report uncovered a Pounds 2.5bn deficit. The group said yesterday that current contributions of Pounds 310m a year would soon increase to Pounds 450m a year.
The trustees of the fund argue that even more than this should be contributed to clear the deficit within 12 years rather than a planned 40 years, and to reduce the reliance on equities.

The fund’s 80 per cent holdings in shares is too risky, it has said, and more cash should be invested in debt. These changes would push up the cost of covering the deficit, said Royal Mail, to about Pounds 800m a year for the next 12 years.

Stephen Agar (RM) said at the Postcomm Pricing Review meeting on 18th November 2004 that he thought it would be several years before access licence holders achieved a billion items per year, i.e. 5%.

When challenged, he also included in this 5% major customers dealing direct with Royal Mail via access.

The Royal Mail is making GBP1 million a day and delivering more than nine out of 10 first class letters on time, the organisation reported today. Chief executive Adam Crozier said the group was being “transformed” under a massive modernisation programme which had delivered profits of GBP217 million in the first half of the current financial year. Royal Mail chairman Allan Leighton, said: “No-one should doubt or under-estimate the scale of task we have tackled. We are delivering a massive modernisation programme, restoring profitability and driving up service to customers. Royal Mail is being transformed. “Recently, there have been few plaudits for postmen and women but I believe they can take pride in the progress achieved since Royal Mail’s three-year renewal plan was launched two and a half years ago. The focus on achieving consistent, high quality service – Royal Mail’s number one priority – is showing positive results.”