Tag: UK

UK Royal Mail vows to fight against regulator’s new price controls

Postcomm is to change the way it regulates Royal Mail by establishing price controls linked to efficiency improvements and freezing average prices until 2010. The proposals, published today, toughen up existing controls on Royal Mail less than a month after it announced record profits of Pounds 537m from operations. The plans, which also include changing Royal Mail’s service standards to reflect customer needs better, are to be introduced in April 2006, three months after the market is opened up to full competition. But Royal Mail reacted angrily and vowed to fight the proposals, if necessary, through the Competition Commission. It claimed they threatened universal service, the commitment to deliver to every household, and encouraged cherry-picking by rivals. The price controls, based on an asset value for Royal Mail of Pounds 2.2bn, would allow the company to make a regulated profit of about Pounds 285m a year until 2010, although it could improve this by raising its efficiency levels and growing volumes.

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DHL corporate mail hub opens in Warrington

DHL Global Mail has opened a regional mail hub in the North West for business mail.

The launch is the first step in the expansion of the organisation’s network, which will eventually cover the UK’s key business areas, helping it to compete with Royal Mail.

Located in Warrington, the hub will serve Manchester, Liverpool, Stockport and Warrington through DHL’s service Smartmail Citispeed. This currently offers mail collection from any company in the UK with delivery to London postcodes.

The expansion marks the integration and rebranding of Speedmail International into DHL, following its acquisition in January 2004.

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UK Royal Mail hit by defection of big customers to rival operators

Royal Mail is set to lose some of its biggest and most lucrative customers with a string of government departments, high street banks and insurers preparing to defect to rival postal operators.

The Department for Work and Pensions (DWP), the Inland Revenue and several large banks are understood to be close to switching from Royal Mail to one of the new breed of competitors which have moved in after the liberalisation of the pounds 5.8bn postal market.

Losing the DWP, in particular, would be a serious blow for Royal Mail as it is the biggest postal user of any Whitehall department. The DWP has already removed about pounds 400m of business a year from Royal Mail by paying state benefits direct into bank accounts rather than through the Post Office branch network.

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Irish An Post and staff at odds over future

Arcane trade union practices are threatening An Post’s potentially profitable bulk mail business, according to company management.

Direct marketing mail increased by 22 per cent last year, as traditional postal services declined.

Last week, An Post began an investigation into the dumping of bulk mail in a ditch by postal staff in Co Meath.

The company’s commercial director, DerekKickham, said it was not an isolated incident and indicated a need for workers to undergo a mindset change’. But Sean McDonagh, of the Communication Workers’ Union (CWU), said only one postal worker had been sacked for dumping mail in the past year.

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