Tag: UK

Royal Mail loses bid to bring in zonal pricing

Posted by | Jul 24, 2007 | |

Royal Mail’s hopes of boosting flagging profits by shaking up its charging structure were dealt a blow yesterday, when the regulator threw out its plans for zonal pricing.

Postcomm said it would reject Royal Mail’s proposal to charge according to the costs of delivering in certain areas because it would be “discriminatory”.

Rivals to the postal group complained that the plan would enable it to price them out of the market because it could lead prices down in lucrative, city centre locations. Consumers also feared that services to rural areas would suffer as Royal Mail charged more for going there.

Only business customers would have been affected by a switch to zonal pricing.

This was the cornerstone of its moves to increase competitiveness as it faces more rivals and a declining postal market. The group has also asked for rises in the price of stamps for domestic mail.

Nigel Stapleton, Postcomm chairman, said: “We are proposing to reject Royal Mail’s application mainly because it has put forward a pricing structure that appears to have a number of discriminatory features and would have been introduced in a way that would lead to unreasonable changes for customers.”

A Royal Mail spokesman said: “We are disappointed at the decision. This was a proposal that only affected large business users.”

Postcomm will next month publish a report setting out its objections to zonal pricing, after which there has to be a two-month consultation. But the rejection will be backed by Royal Mail’s customers so is unlikely to be reversed.

The regulator will also soon adjudicate in a row between Royal Mail and its rivals over the amount the state operator can charge competitors to use its infrastructure for the last mile delivery. Rivals say it is charging too much so they cannot make a sufficient margin, while it says it does not make enough profit on the arrangement.

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UK postal workers fury over pensions stitch up

Posted by | Jul 24, 2007 | |

Unions have accused the Royal Mail of a “stitch up” over leaked proposals to cut workers’ pensions.

The Daily Mirror reports it has seen a 24-page document on plans to tackle a GBP 6 billion shortfall in the pension fund.

Under the shake-up the final salary pension scheme could be closed to new members from next year and the age at which staff can retire with a full pension will be raised from 60 to 65 in 2010.

Union leaders vowed to fight the proposals, which would affect workers at Royal Mail, Post Office and Parcelforce Worldwide.

Dave Ward, deputy general secretary of the Communication Workers Union, told the Mirror the plan was a “stitch up”.

He said: “This is a savage attack on pay and conditions. Our members aren’t going to roll over and accept this.

“It will only galvanise support for strike action. It’s a stitch up. They may say they’re consulting but that’s a charade.

“It’s clear from the work in producing these plans that they’re determined to drive them through.”

The leaked document stresses no formal decision has been made and the proposals are designed to form a consultation basis.

According to the newspaper, the document says: “These changes would gradually reduce the Royal Mail’s overall pension costs and therefore reduce the future risk to our business, jobs and existing pensions.”

Future rises in pensionable pay for the company’s 167,000 workers would be capped at the inflation rate and lump sum payments on retirement would also be hit.

A Royal Mail spokesman said no decision has been made on the future of the pension scheme.

He said: “Royal Mail said very clearly earlier this year that it would be consulting on the future of the pension scheme for both new recruits and existing members but no decisions have yet been taken as we have not even begun the formal consultation.”

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Royal Mail may have to pay GBP 1bn for the redundancies it needs, says consumer chief

Posted by | Jul 24, 2007 | |

The government may need to come up with an extra GBP 1bn to fund a massive redundancy programme to help the Royal Mail out of its crisis, a consumer chief warned before strike action by the Communication Workers Union.

David Bland, a regional chairman of Postwatch, believes the Royal Mail has no alternative to automating its letter systems and slimming down its workforce if it wants to survive private-sector competition. He said no one in the industry would win from industrial action at a time when many users were turning to email and other alternatives to the state postal service.

Without a clear look at the Royal Mail books it was impossible to know how much money was needed, added Mr Bland, but he believed it would be hundreds of millions of pounds if not a billion.

The department of trade and industry – now business, enterprise and regulatory reform (BERR) – has already agreed to allow Royal Mail to borrow GBP 1.2 bn to help it fund modernization of its systems. It has also allowed Royal Mail to put some GBP 800 m in a special account as part of a programme to bolster its pension scheme as it fights off companies such as TNT and UK Mail that are winning more and more of its business customers.

Mr. Bland believes that Royal Mail is giving an over-gloomy picture of its pension requirements, but the company accepts revenues are falling along with an overall 2 pct annual decline in post volumes and it is not in a position to fund a large wave of redundancies.

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DHL hopes to expand airport consolidation centre in Heathrow

Posted by | Jul 24, 2007 | |

DHL- Exel is hoping to expand the scope of its Heathrow Consolidation Centre (HCC) by providing additional services. The HCC currently works with all the retailers, before and after security, at all the Heathrow terminals. This means that all the retailers deliver to the HCC and DHL takes those deliveries into the airport terminals.

Paul Durkin, business director for airport logistics and consolidation centers at DHL-Excel, says the HCC reduces commercial vehicle movements to the terminals by about 80 pct. He believes this could be cut even further if DHL is able to start delivering engineering products into the airport and take over deliveries to airlines.

Durkin says that while there are no firm plans at the moment, the company is investigating both possibilities. “Because of the increasing security requirements for the terminals, it makes sense for us to take products into the sites because we have the security screening processes at the HCC.”

DHL operates a bus-stop-type system around the airport at two-hour intervals during the day. As well as delivering into the terminals, it also removes packaging and recycling, and shifts stock from one terminal to another. DHL is also hoping to work with BAA to open consolidation centres at other airports around the UK.

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Bailey boots Palletline management team

Posted by | Jul 24, 2007 | |

Palletline plc, the UK’s most experienced palletized freight distribution network, has further strengthened the senior management team at its Birmingham hub through the appointment of Troy Bailey as General Manager – Operations.

Troy joins Palletline from another national network and will once again join forces with Operations Director Mark Pulford with whom he has previously worked.

Troy’s key role will be the day to day management of operations at Birmingham, focusing particularly on scanning, next day and economy deliveries and hub optimisation.

Troy has spent his entire career in the logistics and related sectors, staring with Caterpillar and then moving to Christian Salvesen where he was a contract manager for major customers including Land Rover, Massey Ferguson and Volvo.

He then spent eight years with Tamworth-based DFDS Transport as a divisional manager, before joining Geologistics in Birmingham where he spent two years as regional manager covering the midlands and south-west.

His most recent role saw him drive a number of key operational improvements for another national pallet distribution network.

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