CWU Submission to Consumer Futures Annual Plan 2014-15

[TrueBlueTerrier]

Letter to Branches




No. 215/2014
Ref : BT/SW
Date: 03 April 2014


To: All Branches


Dear Colleague,

CWU Submission to Consumer Futures Annual Plan 2014-15

The union has made the attached submission to the Consumer Futures Draft Work Plan for 2014-15.

The submission raises concerns about unchecked end-to-end competition in the mail market which is threatening the universal postal service by enabling companies like TNT to cherry pick the most profitable areas for delivery. The document calls on Consumer Futures to engage with Ofcom in order to maintain standards and protect the universal service on behalf of the public.

The submission also expresses the CWU’s concerns about the transformation plans that will bring fundamental changes to the way Post Offices operate and the level of service provided. We call on Consumer Futures to reflect the public’s opposition to plans to franchise seventy and close a further six Crown Post Offices. Consumer Futures own research – Are you being served? – highlighted that customer service has been materially worse in the branches franchised to WH Smith in 2008 than in Crown Post Offices; yet despite this it has expressed no opposition to the Post Office’s proposals to franchise further branches by April 2015.

On 1st April 2014, Consumer Futures became part of the Citizens Advice service, Citizens Advice Scotland and the General Consumer Council for Northern Ireland. The submission calls on Consumer Futures and its successor bodies to continue to provide a strong consumer voice in the postal market to defend the universal postal service and the Post Office network.


Yours sincerely,


Bill Taylor
Head of Research (a)

[TrueBlueTerrier]

CWU submission to Consumer Futures Annual Plan 2014/15



Overview



1. The Communication Workers Union (CWU) is the largest union in the
communications sector in the UK, representing over 200,000 employees in
the postal, telecommunications and financial services industries. It is the
recognised union for all non-management employee grades in the Royal Mail
Group and the Post Office.




2. The CWU welcomes the opportunity to comment on the Draft Work Plan for
Consumer Futures before the prospective changes to the organisation in April
2014. While the CWU differs from Consumer Futures on a number of issues
we believe it plays an important role in the postal sector.




3. Over the past decade we believe that the policy agenda on postal issues has
been set by stakeholders with significant commercial interests, delivering little
in the way of benefits for individual consumers and small businesses. With a
majority of Royal Mail itself now being privately owned, a strong consumer
body is particularly important at the current time to make sure the public are
represented and the universal service is protected.




4. In relation to Post Office issues, as the consultation document notes, the Post
Office network is undergoing an unprecedented period of transformation. This
means significant change for the public and small businesses, who have had
no input into the formulation of the Post Office’s strategy. Again, it is clear that
a strong consumer voice is needed in this area.




5. On both issues we would therefore stress the need for the bodies Consumer
Futures is being merged into – Citizens Advice, Citizens Advice Scotland and
the General Consumer Council for Northern Ireland – to continue to prioritise
work on these issues and we have outlined the matters we believe are
particularly important for them to focus on below.




The mail market



6. In relation to the mail market, the privatisation of Royal Mail raises important
concerns for consumers in terms of service standards, the provision of the
universal service and pricing, as the consultation document recognises.
Equally, however, we believe Consumer Futures needs to monitor
developments in the wider postal market.




7. In particular we have concerns over the unchecked development of end-to-
end competition. As Consumer Futures will be aware, TNT Post is currently
conducting end-to-end delivery operations in London and Manchester and
has seen a threefold increase in volumes in just over a year.




8. The expansion of competition in this area raises two important issues for
Consumer Futures. Firstly, we believe there is a growing need to monitor
standards for consumers here, particularly given the disparity in the regulatory
burden faced by Royal Mail and its competitors.




9. And secondly, there is a clear need to ensure that the universal service is
protected in the face of competition. Competitors to Royal Mail like TNT are
able to cherry-pick the most profitable areas for delivery and have a platform



into the market from downstream access, which is widely recognised to have
subsidised competition at the expense of the USO.




10. The overhaul of the regulatory regime under Ofcom which was necessary to
protect the universal service demonstrates the risk that competition poses for
individual consumers who have seen little in the way of benefits from
deregulation. End-to-end competition has the potential to have just as
significant consequences as downstream access to the future of the service if
it goes unchecked and we would therefore urge Consumer Futures to take a
pro-active approach in engaging with Ofcom on these issues on behalf of the
public.




Post Offices



11. As we wrote in our submission to Consumer Future’s draft plan for 2013, it
has expertise and knowledge that other organisations lack for holding the
Post Office to account and it has published more information on the new
Locals and Mains models being rolled out across the Post Office network than
Parliament, the media, the government and the Post Office combined, which
underlines the importance of its work in this area.




12. The Post Office’s transformation plan runs until 2017 and will bring in new
operating models and ways of working for virtually every branch in the 11,500
strong network. These involve fundamental changes to the way Post Offices
operate and the level of service that will be provided.




13. The announcement made by the Post Office and the government in
November 2013 that this programme is being extended, and will effectively be
compulsory for postmasters, shows a desire to go further and faster on the
part of the Post Office, which raises challenges for Consumer Futures’
oversight of the programme and highlights the need for it to dedicate resource
to this.




14. In relation to these transformation plans, we welcome the statement in the
consultation that ‘consumer needs and priorities’ should drive the
transformation of the Post Office. However, as Consumer Futures is aware,
we believe it needs to take a stronger line on the new models being adopted,
if this is to be the case.




15. The CWU has campaigned strongly against the Post Office’s plans to
franchise seventy, and close a further six, Crown Post Offices; we have held
sixty public meetings across the country and collected tens of thousands of
signatures on petitions against these changes. However, while there is
significant public opposition to the proposals, we do not believe this has been
reflected by Consumer Futures in its work to date.




16. As we stated in our submission last year, Consumer Futures should not be
agnostic on the operating models the Post Office adopts for its branches and
should respond to the public’s views. Consumer Futures own research – Are
you being served? – highlighted that customer service has been materially
worse in the last tranch of branches to be franchised to WH Smith in 2008
than in Crown Post Offices; yet despite this it has expressed no opposition to
the Post Office’s proposals to franchise a further seventy branches by April
2015.





17. Consumer Futures is also aware that the CWU does not believe that the
Code of Practice for the Post Office to consult on changes to branches is
strong enough or gives consumers a genuine opportunity to influence the
plans because it specifically excludes feedback on the principle of the change
being proposed. Indeed, we note that WH Smiths has advertised for jobs in
franchise offices it is planning to take on before the consultation period is
over, which reflects a perception that the consultation is merely a formality.




18. We would therefore urge Consumer Futures and its successor bodies to
review the Post Office’s proposals for franchising and network transformation,
and the provisions of the Code of Practice, as a matter of urgency.








For further information on the views of the CWU contact:



Billy Hayes

General Secretary

Communication Workers Union

150 The Broadway

London

SW19 1RX



Tel: 020 8971 7251

Email: bhayes@cwu.org





21 February 2014