Demographics: The changing face of customers
Demographics: The changing face of customers
Read MoreTag: Royal Mail
Post office closures in Scotland
Campaigners yesterday warned communities across Scotland will face a “devastating” blow in the New Year with the closure of hundreds of post offices.
Details of around 40 post offices likely to close in the Highlands and Islands will be announced on January 8, with the list of the 44 to be axed in Glasgow, Central Scotland and Argyll and Bute published the following day.
Announcements on further closures elsewhere in the country will be made throughout the year as part of the UK Government’s plans to shut 2500 post offices to help tackle rising losses.
Postal bosses insist “the status quo is not an option” and that the large-scale closures will guarantee the service’s long-term future.
But the decision was criticised yesterday by politicians and postal workers, who warned of the “devastating” effect it will have on local communities, especially those in rural areas.
Mike Weir, the SNP’s spokesman on business and postal affairs at Westminster, criticised the UK Government for giving communities only six weeks to fight the plans.
A spokesman for Postwatch said they believed the consultation period for the closure plans should be doubled from six to 12 weeks.
Read MoreRoyal Mail loses contract to TNT
Royal Mail has been dumped by Preston council bosses in favour of postal operator TNT. Preston Council’s postal bill was slashed by over GBP 17,500 in the move.
Preston Council is expected to approve plans to transfer all mail to TNT although Royal Mail will still deliver the bulk of the mail through what is known as ‘Downstream Access’ – this is where rivals can sort and handle mail but leave Royal Mail to deliver it.
Royal Mail has complained to Postcomm that Downstream Access allows its rivals to poach business contracts but leaving Royal Mail to do the legwork.
Read MoreSecond anniversary of the liberalisation of the UK postal market
Postcomm has found competition in its second year is starting to benefit more and more mail users, but has urged all operators to rise to the challenges posed by the digital age.
Research commissioned by Postcomm in 2007 found the benefits that large mailers have been experiencing since the market was opened have now started to slowly spread to smaller businesses. However, much more progress is needed and the challenge posed by the growing number of alternatives to mail confirms the need for mail operators to continue to pursue greater innovation.
The market research, which formed part of Postcomm’s annual Business Customer Survey, revealed that although Royal Mail remains the dominant operator, one in five small and medium mailers and more than a third of large mailers are using more than one mail provider.
Postcomm’s annual Competitive Market Review (CMR), found that mail volumes were 2 per cent down on last year, but there are indications that direct mail is growing in sectors such as building societies, charity, and health.
End-to-end competition has declined by four million items and stands at less than one per cent of total mail volume, but mail volumes collected by ‘access’ operators and delivered by Royal Mail have more than doubled and now represent 19 per cent of revenue-derived mail volumes.
The research shows that a larger number of small businesses are beginning to benefit from competition, but much more needs to be done before small firms can experience the full benefits of competition that larger mailers have seen since the market was opened.
Read MorePostEurop call Council of the European Union to resume negotiations on VAT legislation for postal services
The postal industry needs a reliable VAT legislation. The 6th VAT Directive no longer provides for legal certainty as demonstrated by the infringement procedures most recently launched by the European Commission. Moreover, taking into account the changes that the industry has undergone in the past 10 years, modernizing VAT regulations seems reasonable.
On May 5th 2003, the European Commission issued a “proposal for a directive amending directive 77/388/EEC as regards VAT on services provided in the postal sector” (COM/2003/234).
It provides for equal treatment of postal services in term of taxation. It also introduces an option to apply reduced VAT rates for certain postal services with the intention to limit any increase in postal prices due to the introduction of VAT.
On March 11th 2004, the European Parliament agreed to the introduction of VAT in public postal services. The European Parliament has proposed to make the application of a reduced rate mandatory.
The deliberations (2 July 2003 to 15 June 2004) within the Council failed in the absence of the required unanimity and negotiations have been suspended for about 3 years now.
On 23rd March 2006, the European Commission launched infringement proceedings by sending letters of formal notice to the UK, Sweden and Germany on the VAT application of postal services.
The rules governing the application of VAT should not be left to finally decisions by the ECJ based on an interpretation of the 6th VAT Directive (dating back to 1977). The decision how to apply VAT on postal services is essentially a political one and therefore needs to be agreed upon by the Council.
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