Tag: Domestic

Postcomm decide on financial relief for industrial action & future of the bulk mail compensation (UK)

Posted by | Aug 19, 2008 | |

Postcomm published decision documents about giving Royal Mail financial relief for industrial action in 2007-08, and potentially also for 2008-09, and set out the future of the bulk mail compensation scheme.

Postcomm has largely accepted Royal Mail’s application for relief from the financial consequences of transformation-related industrial action in 2007-08. This means Royal Mail will forgo GBP 21.6m of allowed revenue (due to the C-factor) because of poor quality of service performance during the year, but bulk mail customers will not receive compensation. If Postcomm had not accepted the application, Royal Mail would have had to pay around GBP 77m in bulk mail compensation to customers and would have forgone around GBP 91m in allowed revenue. If Royal Mail’s application had been accepted in full, Royal Mail would still have forgone GBP 12m because of its poor Postcode Area performance.

Postcomm has agreed, conditionally, to Royal Mail’s request to suspend the Bulk Mail Compensation Scheme and to adjust the C-factor in 2008-09 where quality of service failures are caused by transformation-related strike action. However, Postcomm will consider a wide range of factors in reaching a final decision on relief at the end of the year.

Postcomm has decided to remove the regulated bulk compensation scheme for delay from 1 April 2010. The main reasons for removing Royal Mail’s compensation scheme for delayed bulk mail are:

– In the developing competitive market it is more appropriate to move towards market driven outcomes;
– Removing the scheme will allow customers to negotiate compensation schemes to suit their own needs;
– The current scheme does not necessarily target those customers who have suffered poor performance.

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Postcomm to Amend Postal Operator Licences

Posted by | Aug 19, 2008 | |

With Postwatch soon to be absorbed into a larger multi-consumer watchdog known as the National Consumer Council on 30th September, Postcomm is making adjustments to its paperwork which includes existing postal operator licences.

To prepare for the abolition of Postwatch and the new complaint handling standards, Postcomm needs to make relevant licence modifications to postal operators’ licences to reflect the transfer of functions from Postwatch to the new NCC and the new complaint handling standards.

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Post Office Outreach Funding To Be Examined

Posted by | Aug 17, 2008 | |

Following concerns by the Business and Enterprise Committee, the National Audit Office is to begin a detailed analysis of the financial support available for UK post office outreach services. The Committee is concerned that outreach services which are already replacing many rural post offices, would ultimately fail through lack of funding.

The Committee demanded clarification on the relationship between Post Office Ltd and Royal Mail as well as Royal Mail’s service expectations from Post Office Ltd, plus a detailed breakdown of exactly how Royal Mail determines the cost of such services against the actual costs as delivered by Post Office Ltd.

Alan Cook, managing director of Post Office Ltd, told the Committee that Royal Mail paid Post Office Ltd, which then paid subpostmasters for the work they did. The arrangement is somewhat unique in that Post Office Ltd is a subsiduary of Royal Mail yet is unable to raise its prices to combat growing costs.

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Postcomm statement on Royal Mail's industry consultation on zonal access price structures (UK)

Posted by | Aug 14, 2008 | |

Postcomm welcomes Royal Mail’s industry consultation on a revised zonal access price structure. This consultation impacts on two projects which Postcomm has been undertaking over the past several months.

The first project is Postcomm’s general review of zonal access pricing (under which Royal Mail charges a zonal price for delivering mail to the “final mile” for large customers and other postal operators).

The second project concerns TNT Post UK Limited’s request to Postcomm for a direction under Condition 9 of Royal Mail’s licence for two access products, both of which it requested to be zonally priced but with a two zone pricing structure.

Postcomm hopes that Royal Mail, TNT Post and the wider industry will be able to work together to put in place appropriate terms for both zonally priced access and nationally priced access to the Royal Mail network. If agreed, these new arrangements could help to secure the provision of a strong and self financed universal service in parallel with the development and sustainability of both access and end-to-end competition.

Postcomm will aim to publish its observations on Royal Mail’s industry consultation by the end of August 2008.

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