Tag: Royal Mail

Royal Mail’s plans to charge more for bulk business mail in rural areas were condemned by politicians yesterday.
The Universal Service Obligation requires the Post Office to deliver mail at the same price regardless of where you live in the UK. But now Royal Mail insists that no other country in the EU is opening its postal markets to competition in the same way as Britain. It says that its commercial rivals in the UK would handle around 2.5 billion letters this year, well ahead of expectations and equivalent to 25% of bulk business mail.
Royal Mail is seeking permission for a new zonal system of pricing which would allow it to charge more for bulk business mail in rural areas. Danny Alexander, LibDem MP for Inverness, Nairn, Badenoch and Strathspey, said: “If permission is given for this proposal to go ahead, then businesses and consumers in the Highlands will pay the price. Local businesses will pay more and it may well be that some firms will try to extra charges will be passed on to Highland consumers too.”
Dave Thompson, SNP candidate for Ross, Skye and Inverness West, said the USO was an important safeguard for rural areas.

Royal Mail’s proposals to introduce a more competitive pricing system have been attacked by mail users and postal operators after the industry regulator launched an inquiry.

The state-owned operator wants to introduce a pricing structure for bulk mail to enable it to charge different amounts depending on the destination. This, it says, would help it to cope with mounting competition from private sector operators.

The proposals would mean charging 2.5 per cent more for sending mail to anywhere in Greater London, where costs are 12 per cent higher than the national average. Mail to business districts costs 28 per cent less than average to deliver and Royal Mail is proposing to cut charges 4.9 per cent.

There was anger over the request to charge more for delivering bulk mail inside the M25, which Royal Mail said was necessary to cover higher salaries and the cost of handling congestion.

Alan Halfacre of the Mail Users’ Association said the former monopoly had failed to raise its efficiency in the capital to the level elsewhere in the country.

In its first proposals on zonal pricing, submitted nine months ago, Royal Mail had proposed a 1.7 per cent cut in charges for delivery in the capital. Now it wanted to charge 2.5 per cent more, 4.2 per cent than it had initially proposed – with even larger rises for people living outside built-up areas.

“These increases will en-courage banks, insurers and utilities to move customer billing online. Royal Mail is making itself a problem.”

Royal Mail said its proposals would be cost-neutral, with higher charges in some areas matched by lower prices elsewhere. The cost of sending two-thirds of the mail involved would fall.

But competitors said the move was an attempt to protect the former monopoly from competition by reducing its charges in areas where they could win business.