Royal Mail must deliver or die, as it faces serious competition for the first time. From tomorrow, the European postal services directive will reduce the part of the postal market that can be reserved to national monopoly operators.
Read MoreRoyal Mail faces multi-million-pound fines unless it dramatically improves two business mail services, it emerged yesterday. The industry regulator Postcomm placed an enforcement order on Royal Mail, requiring it to improve the two services by the end of March or face a fine of around pounds 8m.
Read MoreA £15 million fund to help keep post offices open in England’s most deprived urban areas, was launched by Regeneration Minister Tony McNulty. Up to £50,000 will be available to sub-postmasters to maintain, modernise and expand their branches, as part of the Government’s long-term drive to regenerate impoverished urban communities. The grant can be spent on new retail facilities, such as bakeries or greengrocers, better security, updated IT equipment, or shop alterations.
Read MoreRoyal Mail Group has called for greater flexibility to increase postage stamp prices after warning that it may face extra costs of at least Pounds 1bn over the next three years. Postcomm, the postal regulator, has already agreed to a 1p increase in the price of first class and second class stamps from April to help stem Royal Mail’s Pounds 1.1m-a-day losses, as long as average prices are then frozen until 2006. But Royal Mail claims this could be swamped by a potential Pounds 330m black hole in its pension funds and a further Pounds 280m to cover possible rises in interest payments on government loans.
Read MoreThe Royal Mail faces a pensions black hole of pounds 330m following the collapse in the stock market. To make good the substantial deficit, it has asked the regulator, Postcomm, for the flexibility to make further increases in the price of a stamp on top of a planned 1p rise from next April. The loss-making postal group is warning that it also faces an extra pounds 120m bill to cover National Insurance Contributions following NIC increases announced in the budget. Royal Mail may require a further pounds 280m to cover potential increases in interest payments on Government loans. Royal Mail last valued its pounds 15bn pension fund three years ago, before the bear market in equities set in with a vengeance. It is planning a new actuarial valuation in the spring, but has already estimated this will show a deficit of pounds 330m.
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