Tag: Royal Mail

The mail regulator faced a grilling from MPs yesterday over proposals to liberalise the mail market while curbing Royal Mail’s own prices. Graham Corbett, Postcomm regulator, told a select committee headed by Martin Stanley that his 240-page document on price controls and increases for Royal Mail was not “regulatory treacle”, as it was dubbed by Allan Leighton, Royal Mail chairman. “What monopolists think of as regulatory treacle is what most consumers think of as proper oversight,” Mr Corbett retorted.

Postcomm has stunned Royal Mail by slipping into its proposed price controls a potentially fatal condition on how competitors will get access to the company’s network of sorting and delivery offices, Royal Mail Chairman Allan Leighton said today. Mr Leighton said he was appalled at the way the regulator, without any prior warning or publicity, had buried a ruinously low assumption on access price in the detail of the 240-page document on Royal Mail’s future prices, published last Thursday. “It is now very clear that Royal Mail can expect just 14p for First Class letters if competitors collect mail and then give it to our sorting and delivery offices for the journey to customers’ letter boxes. 14p is an absurdly low price compared to the basic 27p First Class stamp.”

Royal Mail today accused Postcomm of “wreck-u-lation” and slipping “a potentially fatal condition” into its final price control proposals because it included an assumption on the cost of access by competitors to Royal Mail’s delivery network. Postcomm has stated: “Royal Mail’s price control is designed, against a reasonable range of assumptions, including on access, to ensure that the company has enough cash to cover its outgoings and implement its renewal plan. It is nonsense to suggest that this is a “bombshell” to Royal Mail. Since October last year we have been discussing the pricing of access with Royal Mail. No price has yet been set for access. “