Author: Archive

Expensive living costs strangle the UK’s savings

Posted by | Mar 28, 2008 | |

The rise in day-to-day living costs is leaving people with no spare cash to put away in savings, according to a new study by the Post Office, and those that are able to save are withdrawing their money shortly after depositing it.

Increases in council tax and energy bills have hit the UK’s wallets hard with 4.8 million people saying they simply cannot afford to make regular savings contributions because of rises in living costs**. Almost half (49 per cent) of those not saving (17 per cent of the UK) said they simply have no surplus cash at the end of each month to save.

The Post Office has also discovered the emergence of savings ’bouncers’, where people who have been making savings contributions to their savings account then find that they have to withdraw the money before the month is over. The study shows that in the past 12 months, half (50 per cent) of those who made a contribution at the beginning of the month had to withdraw it before the end. One in five (19 per cent) admitted to ’bouncing’ every month.

Four in 10 (43 per cent) of those who save said they stop or reduce the amount they save leading up to the Christmas period. Some are still feeling the effects into the new year, with one in five (21 per cent) savers saying that it would be at least March before they could return to saving.

Many people that are actually saving are becoming more wary of where they put their money. Due to the media attention given to the world’s current economic situation, one in 10 said they are now wary of savings accounts (10 per cent) and products linked to the stock market (11 per cent).

However, almost half (47 per cent) of the respondents said that their savings behaviour had not changed. Over half (57 per cent) said instant access accounts are now the best home for their cash. Four in 10 (43 per cent) felt that cash ISAs were now the safest place for their savings.

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New Zealand Post introduces new pricing in proportion system

Posted by | Mar 28, 2008 | |

On 28 March 2008, New Zealand Post introduced a new pricing in proportion system for all standard domestic mail. Similar to the system recently introduced in the UK this means letters and parcels sent within New Zealand are now priced in direct proportion to their size and weight. Previously parcels have been priced mainly on weight.

Motivations behind the change are very similar to that of the UK and reflect the worldwide drive for cost reflective pricing among incumbent postal operators. Previously some larger sized items of mail have been the same price to send as smaller items and this has not reflected the cost of handling them. As most of the mail that passes through our network is of a smaller size, it is fair that the postage price is in proportion to the size and weight of the item.

• larger items require manual processing (not machine processing)
• larger items require double handling by both Mail Sorters and Posties
• larger items are more costly to transport due to size

A further parallel with the UK can be seen with many standard items remaining the same price although New Zealand has not introduced a grace period for surcharging it will consider the change when assessing under paid items. The postage price for most of the standard domestic letters that go through the network remains unchanged at NZD 0.50 (USD 0.39)because most of these letters are of a smaller size.

However, a more selective brand of PiP is employed in New Zealand with the more lucrative bulk mail products escaping the new system. Bulk mail products (VolumePost, GoFlexible and PrintPost) and international products are not changing.

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An Post achieves sustained improvement in quality

Posted by | Mar 28, 2008 | |

An Post’s next-day delivery service improved by five per cent in 2007 (to 77 pct) over the previous year, according to quality monitor figures announced by ComReg today (March 27, 2008).

Most significant is the seven per cent improvement (to 73 pct) achieved in the busy October to December period, over the same quarter in 2006 (66 pct). This quarter includes the pre-Christmas and year-end rush during which An Post’s recorded a processing peak of almost eight million items in one 24 hour period across its four automated mails hubs.

An Post Chief Executive, Donal Connell says that quality improvement is the company’s primary focus for 2008:

International quality monitors also show steady and sustained improvement in An Post’s delivery of international letters and parcels over the past 18 months. Incoming parcel traffic directly generated by on-line and home shopping activity is growing by approximately 14 per cent year on year.

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UK Mail Operators likely to see Uniform VAT rates

Posted by | Mar 28, 2008 | |

Postcomm has hinted at the introduction of a uniform VAT rate (possibly 5 pct) that could be applied to all mail services in the UK.

In it’s ‘Forward Work Plan 2008-11’ Postcomm said it recognised the complexity of the UK mail market and was looking at the constraints that have been holding back the development of end-to-end competition in the UK:

Postcomm said that one barrier to entry was the uneven VAT regime. Royal Mail is currently exempt from VAT, whereas other operators have to charge customers VAT at 17.5 pct. Postcomm said it continued to support a level playing field on VAT for all postal operators, with no significant price rises for customers.

More significantly, it believed that a reduced rate of VAT (of say 5 pct) should be applied to all mail services. It said that in light of the European Commission’s ongoing infringement proceedings against the UK, Germany and Sweden on the interpretation of the VAT exemption for postal services, Postcomm has modelled the effect that different VAT exemption scenarios might have on the UK postal services market.

The result of this modelling has shown that the imposition of the full rate of VAT on all mail services (17.5 pct) could result in around a 5 pct decline in Royal Mail volumes, while the imposition of the reduced rate should only result in a 1 pct decline.

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ComReg reports on An Post quality of service performance for 2007

Posted by | Mar 28, 2008 | |

The Commission for Communications Regulation (ComReg), the National
Regulatory Authority (NRA) for the postal industry in Ireland, today published
the results of the 2007 annual report on the Quality of Service performance of An
Post.
The report for the calendar year of 2007 shows that:
• Overall 77% of single piece priority mail – i.e. standard correspondence – was
delivered within one working day throughout the State. This represents an
improvement of five percentage points in service quality performance over the
annual result in 2006. However, 77% next day delivery compares with a target
of 94% set by ComReg.
• 77% of mail posted in Dublin for nationwide delivery is reported as delivered
the next working day, an improvement of 7 percentage points over the annual
result for 2006, while 77% of mail posted outside Dublin for delivery
throughout the State is delivered within one working day of posting, an
improvement of 2 points over the annual result for 2006. These results indicate
that the level of performance improvement in Dublin in 2007 has not been
replicated in the provinces.
• Mail posted outside of Dublin for next day delivery in Dublin was the lowest
performing regional flow of mail, recording a 75% success rate.
• Traditionally mail posted locally for delivery within the county of posting has
outperformed the national figure. However in 2007 this mail flow performed
poorly and the results indicate no real difference in the performance of local
and long distance domestic mail. For example mail posted in Dublin for
delivery within the county recorded a 78% success rate while in the provincial
counties mail posted for delivery within the county recorded a success rate of
just 79%.
• 97% of all mail was delivered within 3 working days, a performance which
continues to fall short of the 99.5% target set by ComReg

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DHL becomes the main supplier to Sweden's booksellers

Posted by | Mar 28, 2008 | |

DHL Express (Sweden) and the service company for the Swedish Booksellers’ Association, Bopako Service AB, have entered into a long-term cooperation agreement covering 360 bookstores in Sweden. The agreement means that the booksellers can check where their shipments are in the transport chain and that delivery times are significantly reduced.

Swedish people are buying more books than ever before. According to the Swedish Retail Institute, HUI, 80 million books were sold in Sweden in 2007, an increase of 4.1 percent over the previous year.

The Swedish Booksellers’ Association, SBF, was established on August 14, 1993, and now has around 360 booksellers as corporate members. Now DHL Express (Sweden) and the SBF’s service company have signed an exclusive framework agreement for the SBF’s member companies.

Initially, the framework agreement is expected to cover 375,000 shipments and a total of 550,000 parcels per year, making it one of the most important parcels service agreements for DHL in Sweden. And there is every indication that the volumes may be much greater than 550,000 parcels per year. This is because the total sales of books are increasing all the time and this agreement will produce spin-off effects for other types of goods.

DHL Express hopes that the agreement will have a ripple effect on smaller companies, printers and others. Altogether, more than 300 companies are directly or indirectly linked to Sweden’s booksellers.

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Singapore Post Limited and Prudential Asset Management (Singapore) Limited launch Asian property securities fund

Posted by | Mar 28, 2008 | |

Singapore Post Limited (“SingPost”) and Prudential Asset Management (Singapore) Limited (“PAM Singapore”) today announced that they have launched a new fund, International Opportunities Funds (“IOF”) – Asian Property Securities. The fund aims to make 1 pct payout every quarter1,2 for Class Fd Shares. The offer period starts today, 28 March 2008. The fund is exclusive to SingPost customers and is available at selected post offices. This initiative is the result of the growing partnership between SingPost which took root in November 2006. With the latest addition, the range of investment products under SingPost’s “Care for Life” portfolio has grown even more comprehensive. IOF – Asian Property Securities invests primarily in listed closed-ended Real Estate Investment Trusts (REITs) and property related securities of companies, which are incorporated, listed in or have their areas of primary activities in Asia Pacific, which includes Japan, Australia and New Zealand. The fund may also invest in depository receipts [including American Depository Receipts (ADRs) and Global Depositary Receipts (GDRs)], debt securities convertible into common shares, preference shares and warrants.

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Postcomm highlights many Royal Mail failures

Posted by | Mar 28, 2008 | |

Royal Mail is failing to invest properly, is too inefficient and is not developing sufficient new products, the industry regulator has said in a sweeping indictment of the business.
The criticisms by Postcomm are in response to a government review of the impact that competition has had on the state postal group.

The postal group recently warned unions that its pension fund trustees could be forced to liquidate the business or force through huge alterations of the pension scheme unless changes were made.

The warning over the GBP 3.4 billion pension deficit comes as Royal Mail is facing another major industrial showdown with unions over planned pension changes, just months after the end of the last national strikes, which were triggered by pay. A clash moved nearer yesterday when the pension fund trustees approved the changes, which include ending the final salary scheme to all members and raising the retirement age from 60 to 65.

Postcomm highlighted the benefits of competition, such as lower prices and greater innovation for large business customers and record levels of service quality for residential customers.

Royal Mail said that competition was now far ahead of the forecasts from the regulator when the market formally opened to competition four years ago. The business part of the market, which is the only area properly active at present, opened four years ago when Royal Mail finally agreed access terms for its infrastructure.

Royal Mail said that Postcomm’s criticisms had failed to recognised the postal group’s universal service obligation (USO) – its duty to provide a flat-rate service anywhere in the country for domestic customers.

Postcomm argued that the USO was not under discussion for the part of the review it responded to.

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