Tag: Royal Mail

Government department snubs Royal Mail over GBP12m postal contract

Posted by | Jan 9, 2007 | |

The Communication Workers Union (UK) yesterday attacked the decision by the Department for Work and Pensions to award a GBP12m contract for post services to UK Mail, a leading rival to Royal Mail.
The union said it was disappointed that, at a time when the Department of Trade and Industry was finalising plans for investment in Royal Mail’s postal services business, other departments were giving work traditionally done by the state-owned former monopoly to private sector rivals.
The union’s general secretary, Billy Hayes, said: “This is a prime example of how disjointed departments in government are. Instead of using private postal services it is essential that the government understand they have a moral and social responsibility to the network and by not using the service themselves it does not exude confidence to the British public in a government-controlled institution.”
At a time when the DTI was conducting a review of the postal service, it was vital other departments did not make rash decisions which could affect its future, the union said.
A DWP spokesman said it had been urged by the government’s spending watchdog, the National Audit Office, to look at the way it bought postal services to see if it could achieve efficiency savings. The decision to award the contract to UK Mail, a subsidiary of Business Post, followed that review and would save the department about GBP2m over the 13-month life of the agreement.

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Postal union urges halt in Whitehall switch to private sector

Posted by | Jan 9, 2007 | |

The UK government has been urged to stop Whitehall departments switching to Royal Mail competitors for their postal services, after the Department for Work and Pensions signed a deal with a private operator to handle its bulk mailings. The Communications Workers’ Union said it was disappointed that government departments were considering using private contractors at a time when the Department of Trade and Industry was still mulling its investment plans for the state-owned postal service. The DWP said the decision to put the work to tender reflected its need to make savings and followed the recommendations of the National Audit Office.

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Business Post delivers key deal

Posted by | Jan 9, 2007 | |

Business Post shares gained more than 4pc yesterday after the mail and parcel delivery group won the first postal services contract the Government has put out to tender.

The shares closed 18 higher at 439p following the pounds 12m deal with the Department for Work and Pensions (DWP). Guy Buswell, chief executive, said: “We expect other departments to follow suit.”

The DWP’s decision will come as a blow to Royal Mail as private sector competitors make further inroads into its market. Business Post is its largest rival with more than 4pc of the market, delivering over 100m items a month.

Including the 14 other licence holders, Royal Mail has lost 10pc of its business since the process of deregulation began almost three years ago. A recent National Audit Office report estimated that the Government could save pounds 31m annually from more efficient postal services.

UK Mail, Business Post’s mail division, started delivering letters in May 2004. It now has revenues of pounds 40.4m – about 15pc of group turnover – and profits of pounds 3.2m.

DWP will be UK Mail’s largest contract by revenue. By volume, the biggest is NatWest owner Royal Bank of Scotland – the largest mailer in the country.

Business Post competes with Royal Mail on price and service. It does not offer an overnight delivery but guarantees a two-day service cheaper than second class.

It also picks up mail as late as 8pm and tracks all packages. It does not offer end-to-end delivery, but pays Royal Mail about 13p an item as the “access price” for final mile delivery by postmen.

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Royal Mail accused of misleading over price rises

Posted by | Jan 8, 2007 | |

Royal Mail has been accused of misleading the UK public over the scale of its price prices, according to one rival.

Hamilton House Mailings claims that while the Royal Mail’s price rises have been presented by the company as being a simple just above inflation price adjustment, analysis it has done show that the rises are in fact much steeper.

Hamilton House analysed the outcome for a series of typical mailings to 5,000 addresses with a standard 50/50 direct/residue split.

At low weights, it said it found increases in the 3% to 4% range. However, with packet mail the price increases it said were typically between 6% and 7%. When it looked at the heavier packages it found price decreases with the mailing of 5,000 1.4kg packets, resulting in a price decrease of 24%.

Tony Attwood, chairman of Hamilton House, said: “Once again creative teams and mailing teams are going to have to get together to work out the best approach for their customers — and the answers from April are going to be very different from the answers that exist today.

“It really is a great shame that the structure was not sorted out once and for all last August, so that we all knew where we were going.”

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Parcelforce introduces carbon neutral delivery scheme

Posted by | Jan 8, 2007 | |

Royal Mail’s Parcelforce Worldwide business has started an initiative to give its customers the option of offsetting the carbon footprint emitted in the delivery of their parcels.

Parcelforce has calculated the cost of the average amount of carbon emitted per parcel as 10p for UK deliveries and 20p for international deliveries.

Customers booking online have the option to donate half that amount, with Parcelforce contibuting the other half. The money will be invested in a programme run by woodland protection charity The Woodland Trust.

Parcelforce is also working with a number of its account customers who want to achieve carbon-neutral status for their deliveries.

Vanessa Leeson, Parcelforce managing director, said the move is a first in the UK express parcels market, and part of a wider approach by the company to carbon management.

She said: “Our business uses renewable energy in our buildings, bio-diesel in our vehicle fleet and proactively seeks to increase energy efficiency where practical.

“While we’d never force carbon offset onto our customers, many of them are telling us that they will choose the commitment.”

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