Tag: Royal Mail

Postcomm today sought views on arrangements to allow UK Mail Ltd, an
independent postal company owned by Business Post Plc, to use Royal Mail to
provide final delivery of its post. Once it is in place, the arrangement will enable UK Mail to collect mail from its customers, transport it to its Birmingham hub, and from there transport it direct to Royal Mail’s 1,400 delivery offices for final delivery by postmen and postwomen along with the mail they already handle. The access arrangements, as they are called, have been proposed today in a formal Notice of a proposed direction by Postcomm after the two parties were unable to agree terms between themselves. The prices proposed by Postcomm range from 11.46p up to GBP4.06 depending on the weight of the letter or package and the work done by UK Mail Ltd. The proposed prices would allow Royal Mail to recover a 6% operating profit from this business by 2006.

The Royal Mail was considering tonight whether to mount a legal challenge to plans for it to deliver letters for rival firms for 11.5p. Chairman Allan Leighton said he was “shocked” at a proposal by the industry’s regulator Postcomm to allow Royal Mail to make a 6% operating profit by 2006 by giving competitors access to its local delivery network. The proposed price of between 11.5p for letters weighing less than 60 grams – which covers most mail – to a maximum of around GBP4 for a heavy package will apply to private operator UK Mail, but the figure will also be used by any other company entering the postal market.

Royal Mail’s Chairman Allan Leighton said today he was shocked at Postcomm’s plans to give courier firms access to Royal Mail’s delivery network. “We were alarmed at the way Postcomm was moving last autumn to an access price of 14p for Royal Mail against a full price for First and Second Class basic postage of 28p and 20p,” he said. “Postcomm’s plans today propose an access price of just 11½p so the regulator has moved the access price even lower than we feared.”