Anyone just see sky news? RM To Get New Price Freedom

[feduppostie]

didn't catch it all but the jist was Ofcomm putting forward plans to allow RM to decide how much they charge for stamps and for others to use their pipeline

will post a link when one becomes available

Royal Mail To Get New Price Freedom

[feduppostie]

http://blogs.news.sky.com/kleinman/Post ... 7214e06ca3" onclick="window.open(this.href);return false;

I have learned that Royal Mail will be handed unprecedented power to set prices for stamps and rivals’ access to its network under proposals to be outlined in the coming days.

Ofcom, the media regulator, will say in a consultation document setting out potential reforms of the way Britain’s postal market is regulated that Royal Mail should be given greater freedom over what it charges to consumers of its services and to competitors who use its infrastructure.

Such an overhaul would represent one of the most radical changes in the long history of Royal Mail, and would provide the company with some of the commercial autonomy it has been demanding ahead of its likely privatisation.

The proposals are expected to be unveiled later this week, although the timing might yet slip into next week, I’m told.

I understand that the plans to be outlined by Ofcom would transform the UK’s postal industry into one more akin to fully-privatised sectors in which conventional competition laws apply.

If ultimately approved, it would represent a boost for Royal Mail, which has historically had to seek approval from its regulator for stamp price increases and which has been told how much it can charge its competitors for using its network.

Approximately 80 per cent of Royal Mail’s revenues are subject to price controls, a proportion that would shrink sharply if the proposed reforms were adopted.

Moya Greene, Royal Mail’s chief executive, has argued since she took the job last year that the company might not survive unless the regulatory shackles restricting its ability to set prices while forcing it to maintain the Universal Service Obligation (USO) are removed.

The USO is the six-day-a-week, one-price-goes-anywhere postal service that is enshrined in law and which is unique to Britain.

Greene, the former chief executive of Canada Post, has lobbied for many of the changes that Ofcom is expected to unveil in the next week.

Royal Mail is struggling because of the sharp decline in physical mail volumes as customers switch to electronic media such as emails and text messages. The company now handles 62m items each day, as opposed to the 80m items a day it delivered five years ago.

Greene is planning to cut tens of thousands of jobs as she shakes up the way Royal Mail is run. The company’s privatisation is contingent upon its massive historic pension liabilities being taken on by the Government, a move for which it is seeking state aid approval from Brussels.

Ofcom’s proposals will, nevertheless, provoke controversy among Royal Mail’s private sector rivals such as TNT Post and UK Mail, which have been given mandated access to Royal Mail’s network for the last decade.

The plan to give Royal Mail greater autonomy over stamp prices is also likely to alarm consumer groups, although the company would still be expected by Ofcom under a new regime to charge reasonable prices, not least because Ofcom and competition authorities would have wide-ranging powers to intervene in the market if Royal Mail was judged to be abusing its dominant position.

Ofcom assumed responsibility for regulating Royal Mail from Postcomm earlier this month. The transfer of responsibilities was designed to reflect Royal Mail’s status as a company operating in a broader media industry.

As I understand it, many of Ofcom’s proposals will be based on issues highlighted by Richard Hooper, who wrote a widely-praised report on postal regulation in 2008 and updated it last year. Ofcom’s document will effectively be a recognition that the USO is unsustainable without an overhaul of the way the industry is regulated.

They are likely to provide qualified reassurance to prospective investors in Royal Mail, whose traditional letters arm lost more than £100m last year.

The last Labour government attempted to sell a stake in Royal Mail in 2009 when Lord Mandelson, the former business secretary, held talks with investors including TNT, the Dutch postal group, and CVC Capital Partners, the private equity firm which controls Formula One motor racing. The sale process was pulled because of a lukewarm response from bidders.

Under the Coalition’s plans, the Post Office network is to be transformed into a mutually-owned organisation, with Royal Mail seeking an injection of capital from the private sector. It’s unclear whether CVC would be interested this time round, although other large buyout firms have been examining the company.

Barclays Capital has been hired to advise Royal Mail, while UBS is advising ministers on the company’s future.

Ofcom and Royal Mail both declined to comment this evening.

[POSTMAN]

It's all bollox,in the sense that it is a lot too late,wonder what's around the corner.

[rockypostie]

So does this mean they Mayb able to scrap saturdays now?

[tomangoe]

How come whenever they mention Richard Hooper's "fantastic" reports into Royal Mail , they always fail to mention the bit about "Rubbish Management" !

[Wessex]

Nothing really of surprise there to be honest , however the finer details when released will be fascinating.Just cant understand why it didn't happen before the Privatisation Bill lol :vcfo :ncfo

[feduppostie]

it has happened now to ripen us up for privatisation

mind you does this mean we may all finally get colleague share payouts ( runs away and hides)

[Wessex]

it has happened now to ripen us up for privatisation

mind you does this mean we may all finally get colleague share payouts ( runs away and hides)

Hope the cwu make sure its backdated as I'm leaving the business

[knackeredneedadayoff]

all it means is more money for management to squander on stupid ideas and bigger bonuses while get shut of more postman and making us ready for the sell off.we wont see any of it thanks cwu for the crap service you provide.

[Biker Mouse]

So does this mean they Mayb able to scrap saturdays now?

And why would we want to do this?
If this happens then 16% of the workforce would be made redundant.

[DGP1]

So does this mean they Mayb able to scrap saturdays now?

And why would we want to do this?
If this happens then 16% of the workforce would be made redundant.

Not in my office, the OT kings wouldn't get all their OT but staff levels would remain the same.