Royal Mail losing 6p on every stamped letter

[TrueBlueTerrier]

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Royal Mail is losing more than 6p for every stamped letter and parcel which it carries through the post, new figures show

Royal Mail processes and delivers 71million letters and packages to 28 million addresses across the UK every day.
According to Royal Mail’s regulatory financial statements, posted on the organisation’s website, it lost 6.4p for every stamped item sent in 2009/10.

The figures from the accounts are an improvement on previous years, when it lost more than 8p for every stamped letter and parcel sent through the post.

Overall the organisation lost £163million on all the stamped mail it carried in the 12 months to the end of March, compared with £244million and £259million in previous years.

A Royal Mail spokesman said: “The loss has reduced as a result of Royal Mail's modernisation programme - but pressures remain as volumes fall. This underlines the need for modernisation to continue.”

Separately The Daily Telegraph has learned that the Government has brought forward Royal Mail’s privatisation.

An update of a review into Royal Mail's future by Richard Hooper is now expected to be published early next month, with a new Postal Services Bill published on or around 15 September.

The Department for Business has already asked UBS, a City investment bank, to advise on the sale.

Ministers are hoping that the legislation – which would allow ministers to sell off up to 100 per cent of Royal Mail’s shares raising £4bilion to £5billion – will be on the statute books by next summer.

There is still a question over whether any receipts from the privatisation will be used to invest in Royal Mail, or pay down some of its £10.3billion pension deficit, or whether they will be retained by the Treasury.

A Department for Business spokesman said: “We hope to introduce the Bill in the autumn, which would enable private sector investment in Royal Mail.

“The timing of any injection of private sector capital would depend on the progress of the Bill, as well as other considerations - including achieving value for the taxpayer and the state of the market.”

Writing in today’s Telegraph, George Thomson, the leader of the UK’s sub-postmaters, blamed Royal Mail’s regulator for the company’s problems.

He said: “Royal Mail is being strangled by the determination of its regulator, Postcomm, to boost competition from rival firms.”
Mr Thomson complained that foreign rival mail firms were able to “inflict significant damage on Royal Mail while enjoying protected markets at home”.

He added that Royal Mail was “a vital part of the glue that holds Britain’s economy and society together.
A spokesman for Postcomm said: "The market has changed since the current regulation was introduced and mail volumes have been dropping.

"We announced in January 2010 a root and branch review to introduce regulation more appropriate for the current market and went out in May with our initial consultation.”

Earlier this year Ed Davey, the postal affairs minister, told The Daily Telegraph said it was vital that Royal Mail's financial sitiation had to be addressed.

He said in June: "If we don’t transform Royal Mail, it will be dragged down by a lethal combination of falling mail volumes, low investment and potentially one of the worst pension crises for employees in UK history."

He added that if nothing was done "significantly the pensions of past employees, current employees and their families would be at risk".

[oypostie]

"There is still a question over whether any receipts from the privatisation will be used to invest in Royal Mail, or pay down some of its £10.3billion pension deficit, or whether they will be retained by the Treasury."

Think i can guess which one it will be

[guvenor]

then we sue royal mail for failing to pay in , invest properly in our pension fund and properly maintaining it etc
oh and the loss of 6p on mail etc may be something to do with the fact we subsidise big business ie banking and all our competition mail at cut prices not rocket science is it

[Wessex]

At the end of the day we are being screwed by a system where we can never win and its designed to be that way.Our Union bosses must know what the scenario is and have decided to play ball to protect jobs,lets hope that they are smart enough as has been the case in the past to use the available systems to protect us.To be honest if I had the chance I would leave tomorrow.i dread the Brave New World of RM but at my age I think Im stuck.I am scared of ill health or failing to meet standards-what a shambles we have become,it appears we are eager to adopt to these new horizons but what then ?Another set of demands Frankly I am brassed off with it all. :mfo :cfo :lfo

[bexhil palace]

I still have a question that has never been honestly answered.
Why doesn't the CWU come out publicly, and let people know the true reason that RM are slashing there service?

DSA, the cancer that is eating away from the inside.

[not me]

well 2p down
how much do we need to cut for that 6p?

[Wessex]

I think all the portents are there for the privatisation to go ahead.Whilst all the poor posties are worrying about revisions and changes I think the Bill will sail thru'.I cant see any campaign to save Royal Mail. By separating the Post Office from the argument a large swathe of public support goes.What postie after the past 2 national strikes would have the appetite for IA about none is about the answer.One of the posters on this board hinted at a deal on pensions.I reckon thats about right that will be the carrot from government,the only concession in return for a smooth transition.What leverage does the CWU have now .None.