Country sheet: Ireland – Main Developments in the Postal Sector (2006-2008)
Country sheet: Ireland – Main Developments in the Postal Sector (2006-2008)
Read MoreTag: ComReg
ComReg Quarter 2 Postal Quality Results
ComReg’s postal quality of service monitor recorded an 80 per cent next-day delivery rate for the April to June period, a two per cent increase on the first quarter, and up three per cent on the overall 2007 figure.
The particular type of mail checked by ComReg’s monitor accounts for 33 per cent of all mail handled, but doesn’t include large mailings posted by business customers, a segment which accounts for almost 45 per cent of An Post’s daily volumes. Registered and international mail makes up the balance. Ongoing quality monitoring by the International Postal Corporation (IPC) continues to show An Post reaching or exceeding the targets laid down for handling incoming and outgoing international mail.
Read MoreAn Post to seek EUR 30m in subsidies to meet cost of universal role
An Post will seek annual subsidies of some EUR 30 million to meet the cost of its universal service obligations (USOs) once the Irish postal market has been liberalised in 2011.
In its response to the “Public Consultation Process on the Decision to Fully Liberalise the Postal Sector EU-wide”, the postal provider argued that post-liberalisation, it will still be expected to carry out its universal role and should therefore receive subsidies in order to do so.
Otherwise, the postal provider will be at a disadvantage to competing new entrants who will be able to “cherry pick” the more lucrative parts of the postal service.
Although over 60 per cent of the Irish market is currently open to competition, the small letter market has not yet been liberalised, but is due to do so in accordance with EU law by 2011.
It is this section of the market in which An Post fulfils its USO by delivering post at a uniform tariff to every address in the State, regardless of whether it is economical or not.
The postal provider currently estimates that the cost of fulfilling this is between 0.3 per cent to 5.4 per cent of postal turnover, which would represent an annual cost of potentially in excess of EUR 30 million for An Post. In order to determine exactly what the rate should be, An Post has commissioned an independent study to determine the net benefit or cost of the USO, which is due to be published during the summer of 2008.
It is not yet clear how the cost of the USO will be funded. However, it may be that post-liberalisation, An Post will no longer have full responsibility for fulfilling USO, as in its submission to the consultation process, postal regulator ComReg said that the designation of a single universal service provider may not be appropriate.
Read MoreImproved postal service depends on open market, says ComReg
postal service and the provision of better value will only be achieved if An Post’s dominant position “does not foreclose” on the emergence of a fully competitive market.
The regulator’s chairman, John Doherty, said in a paper on the opening of the postal market to full competition in 2011 the challenge for postal operators is to “open the door and grasp the great opportunities” that exist.
Stating that the legal obligations on postal operators must be precise and unambiguous, he said monitoring and enforcement procedures in the market must ensure compliance on a timely basis by all operators.
Mr Doherty was commenting on the forthcoming transposition into Irish law of EU directives which will facilitate the full opening of competition in the mail market. While commercial users of the postal service can use operators other than An Post, this will in theory open the market.
ComReg wants the new legislation to set out a broad definition of the scope of the universal postal service – ie the service available to all parts of the State at all times. In that context, it said that the designation of a single universal service provider may not be appropriate in a liberalised market.
“The alternatives to designation are ‘market provision’ and ‘public procurement’. The two methods can be used in combination, with public procurement being used to fill in any gaps in market provision,” the paper said. It said licencing will be important to control entry to the market and exit from it and give assurance to users of the integrity of the operators.
“The directive continues the existing requirement that the tariffs for each universal service comply with the principles of ‘affordability’, ‘cost-orientation’, ‘nondiscrimination’ and ‘transparency’. A new requirement is that prices ‘give incentives for an efficient universal service provision’,” the paper said.
Read MoreAn Post response to ComReg quality figures
An Post will be examining the detail of the results closely. Improving our next day delivery service remains our key focus and is at the very heart of An Post’s national quality improvement programme.
An intensive national change and modernisation programme centring on how mail is collected and organised for local delivery is being implemented by An Post staff across the country. New ways of working were still being bedded down in a number of the larger Dublin Postal Districts during the early part of this year, and impacted on next-day delivery performance in Dublin.
An Post continues to invest heavily in improving the quality and reliability of its collection services. All postboxes and other posting facilities now display better, easy-to-read information panels on which the latest time of posting is clearly visible. New electronic scanning equipment will be introduced shortly to verify collection times, and to assist in process planning by capturing data on the volume and type of mail being posted. This will enable An Post to drive quality improvement and next day delivery performance throughout its processing and delivery operations.
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