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Is It Time For Some Free Market Reforms In The Postal Sector

21 Nov 2018, 18:18

https://www.libdemvoice.org/is-it-time- ... 59198.html

The Royal Mail was privatised back in 2013, in common with previous privatisations the model used was to move a monopoly type industry into the private sector at the same time leaving elements of that monopoly firmly in place.

Royal Mail was given an ongoing requirement to collect and deliver throughout the UK six days a week and regulated to ensure it did so.

In addition, competitors wishing to provide an alternative letter delivery service have to apply for a license.

The regulator also has powers to control prices and access to the Royal Mail network. In the years that have followed the letter, volumes have fallen dramatically a trend that was already underway prior to privatisation.

Growth in the use of email, initiatives like online bill payment and new regulations such as GDPR are significant factors in this. We are already at a point where very few residential addresses receive mail every day of the week.

At the same time the market in parcels has grown, but in this area, competition is open and fierce. Royal Mail states it wants to transform itself into a parcels company that delivers letters. Now would be a good time to let them do that in a genuinely free market. At the same time, their competitors could also be given the right to operate freely as well.

Reforming the market in post and parcels would be assisted by taking the following measures:
An immediate reduction in the Universal Service Obligation from six days to five with a phased reduction over a period of time leading to its eventual abolition. Premium services like special delivery could then be made available seven days a week.
Complete freedom for any potential competitors who want to enter the home letter delivery field without having to get permission from the state regulator.
Royal Mail to have the freedom to fix its prices for all products including first and second-class mail.
Bulk posters to be able to access the Royal Mail network at individual delivery offices instead of being restricted to its 38 mail centres.
All the above steps would also have the benefit of reducing and eventually eliminating the regulator from the area of postal services saving the hard-pressed taxpayer money.

In the area of parcels, a free market already exists, and competition has forced Royal Mail to adapt, something they haven’t done in letters.

I firmly believe that there has never been a better time to start modernising the UK’s postal sector along free-market lines.

* David Warren worked in Royal Mail for more than 25 years. He is now a freelance business consultant specialising in this area and a liberal.

Is It Time For Some Free Market Reforms In The Postal Sector

22 Nov 2018, 21:33

The Libdems and Tories should just sod off for all I care.
Sold off RM and over £1 billion has been taken out of the company.

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