Tag: Domestic

Royal Mail strikes deal with managers

Posted by | Oct 5, 2007 | |

Royal Mail has reached an agreement with its managerial staff on pensions and pay, although the battle with postal workers, which will disrupt postal services well into next week, is still dragging on.

The deal, which was secured by the Unite union on behalf of its 12,000 members and covers a 27-month period, gives managerial staff a 2.5 pct pay rise, backdated to April.

Under the agreement, Royal Mail’s existing pension scheme will be closed to new members from 31 January 2008 and replaced by a defined contribution scheme for subsequent joiners. The retirement age will increase from 60 to 65 from April 1 2010.

Paul Reuter, Unite’s national officer, said: “Unite has secured a deal with Royal Mail which we believe will protect GBP 1.5bn worth of pension benefits for Royal Mail staff. We now have a pension package that we can take to our members.”

A Royal Mail spokesman said the 2.5 pct basic pay rise recognized “the positive role that managers will play in the modernization of Royal Mail, essential to enable the company to compete in a market open to full competition”.

Managers’ bonuses – which range from 5 pct-9 pct of their annual salaries – will also become pensionable, a detail that helped persuade Unite to accept the terms.

While Royal Mail managed to avert strike action by Unite, postal workers continued to form picket lines in the second day of a 48-hour postal strike.

They are protesting against pension cuts, pay and a modernization program that the Communication Workers Union believes could cut up to 40,000 jobs.

The Royal Mail said in a statement that there were 50 pct more people working today than during previous national strikes, indicating “support for the CWU strike amongst its members [was] weakening”.

A second wave of strikes is scheduled to begin on Monday and last until Wednesday. The CWU has pledged a rolling series of strikes starting October 15 if they fail to reach an agreement with Royal Mail.

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Will strikes signal last post for the Royal Mail?

Posted by | Oct 5, 2007 | |

The postal strike which will freeze all mail delivery until next Thursday is “potentially disastrous”, Welsh business leaders warned last night.

Members of the Communication Workers Union walked out on a 48-hour strike at noon yesterday in an escalation of a bitter dispute with Royal Mail over pay, jobs and pensions, saying another UK-wide two-day strike would follow from 3am on Monday.

Firms were warned there will be no deliveries until late next week and it is estimated the row will cost industry millions of pounds.

The Federation of Small Businesses Wales last night warned of the potentially serious damage to businesses while the Confederation of British Industry Wales said the strike would have “a far greater impact than previous ones”.

But both groups added that the advent of e-commerce meant the strikes would be less damaging than they would have been 20 years ago, and that the more likely effect would be to hasten the demise of Royal Mail as companies looked to bypass its services.

The first signs of this were evident last night, when Royal Mail lost a GBP 100,000 contract with Warranty Direct, which said it would stop using the postal organization to deliver 12,000 letters a month.

A rolling program of strikes will start on October 15 and will continue every week until the dispute is resolved, union leaders warned.

But this could be a case of the union “shooting itself in the foot” as businesses look for alternative ways of doing business, said the FSB and CBI.

David Rosser, director of CBI Wales, said the strike, though disruptive, was still “more annoying than disastrous”.

“Twenty years ago, the impact on business would have been much greater, but the use of e-mail and e-commerce means the effect is much less than it would have been otherwise,” he said.

“The Royal Mail has significant competition in terms of business mail from other businesses and other technologies and a prolonged period without Royal Mail services will encourage companies to look elsewhere.”

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Business Post extends share of UK postal market

Posted by | Oct 4, 2007 | |

Guy Buswell, chief executive of Business Post, the private parcel and mail delivery group, said the postal strike beginning on Thursday could endanger the future of the mail industry if the dispute was not resolved soon.

During the strike, he said, the 6m to 8m pieces of mail which Business Post’s UK Mail subsidiary collects every night would continue to be delivered into Royal Mail depots and wait there for final delivery once the postmen and women were back at work.

Mr Buswell also said the group’s parcels business had seen a sudden slump in deliveries to consumers in the days following the Northern Rock crisis. He said there had been “a huge reduction in volumes” of parcel deliveries from companies which sell electronic goods, such as computers, over the internet.

He said the business had picked up again since, but that it showed that consumer confidence could be hit by such events.

In a trading update covering the group’s half year to the end of September, the group said the UK Mail business “continues to achieve strong growth with revenues in the period up by some 60 per cent.” The mail market in the UK was fully opened to competition in 2006 and UK Mail now has a 7½ per cent market share.

Group revenues in the half year were affected by the loss of a contract with Federal Express. That contract, worth GBP 20m a year in revenues and GBP 2m in operating profits, ended on April 30 after FedEx acquired a UK parcels business.

Mr Buswell said that the group was having success in winning new contracts, however, the loss of the FedEx contract meant that group revenues had increased in the first half by 9 per cent rather than an underlying 15 per cent.

Revenues from the group’s parcels operation were in-line with the same period of last year, as “good growth” in the business-to-business parcels operation had been offset by a decline in deliveries to consumers.

The group’s shares, which have fallen from around 480p in recent weeks ahead of the postal strike, slipped another 6p to 394p in morning trading.

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Postal service given two-year extension to fix up its act

Posted by | Oct 4, 2007 | |

The Cyprus Postal Service could face EU fines reaching the millions if it doesn’t get its act together, Telecommunications Regulator Vasos Pyrgos has warned.

In its 2005 report, the Office of the Commissioner of Electronic Communications and Postal Regulation (OCECPR) said that while there is sufficient competition in postal services, mainly due to express courier services, the government service has failed to meet requisite quality levels.

In 2004, the OCECPR fined the postal service GBP 10,000 for delays in delivering letters; in 2005 the fine was GBP 20,000, and in 2006 it reached GBP 50,000.

Officials claim that Cyprus has fallen short of EU delivery targets because it is the only country in the EU where the postal services are not permitted to take independent decisions to upgrade their department.

Brussels has given Cyprus and Malta a two-year extension (2013) to open up their postal services sectors, but Pyrgos said that drastic steps were needed if the Cyprus Postal Service was to become competitive by that deadline.

Lack of flexibility and poor efficiency are said to be the post’s chronic weaknesses, with some saying that key managerial and operational posts are left vacant.

Parliament has drafted a bill proposing to make the postal service a semi-governmental organization that will be able to run its own day-to-day affairs. But any sweeping changes to the regime are almost sure to provoke reaction from civil servants.

The Cyprus Postal Service still has a virtual monopoly on the market. As a state service, it is obliged to provide services to remote and hard-to-reach regions that may even be unprofitable to serve.

However, if it is able to prove that by providing service to hard-to-reach areas it runs a loss, then it will be eligible for reimbursement from a special fund.

Moreover, current regulations give the government service an edge over private couriers.

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Postcomm welcomes appointment of Ulf Dahlsten as commissioner

Posted by | Oct 4, 2007 | |

The Secretary of State for Business Enterprise and Regulatory Reform has confirmed the appointment of Ulf Dahlsten as a commissioner at Postcomm for a three year term with effect from 1 January 2008.

Ulf Dahlsten replaces Simone Bos who stood down as a Commissioner on 30 September 2007 at the end of her term of appointment.

For the past three years Ulf Dahlsten has been a director DG INFSO at the European Commission in Brussels. Earlier in his career he served as chief executive of Sweden Post as well as Chairman of the holding company of TNT Express Worldwide at a time when the market in Sweden was being fully opened to competition. He has also first-hand experience of the deregulations of the railways, taxi and telecom markets in Sweden.

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