WATCHDOG TO DELIVER FRESH BLOW TO ROYAL MAIL.

[donut]

http://news.sky.com/story/1383934/watch ... royal-mail" onclick="window.open(this.href);return false;

Royal Mail will be dealt a fresh blow on Tuesday when the media regulator says it sees no reason to overhaul rules for rivals competing with it in the end-to-end postal delivery market.

Sky News understands that Ofcom has concluded following an assessment that Royal Mail's ability to meet its universal service obligation (USO) is not being impeded by competition in the end-to-end delivery market.

The regulator will set out its views after months of complaints from Moya Greene, Royal Mail's chief executive, that competitors such as Whistl - formerly known as TNT Post - are able to "cherry-pick" the most lucrative parts of the privatised company's former monopoly, leaving it to cover more expensive rural areas.

The USO, which is enshrined in law, means that Royal Mail must deliver to all 29 million UK addresses for the price of a stamp.

Under postal market reforms, rivals can apply for a licence to carry out the entire process of collecting, sorting and delivering mail, while others pay Royal Mail an access fee for it to deliver to customers.

Ms Greene told a parliamentary committee last week that she believed the competitive framework of the UK market now meant that the USO was becoming uneconomic.

"In a detailed submission in June we highlighted to Ofcom our concern that unfettered direct delivery competition, which means cherry picking easier-to-deliver routes, will undermine the economics of the Universal Service without bringing clear benefits to consumers and businesses," Royal Mail said in a statement.

"We are asking the regulator to bring forward the planned review of direct delivery it has already committed to commence in late 2015, and put in place measures to address the threat it poses to the financial sustainability of the Universal Service."

However, insiders said that Ofcom had concluded that direct delivery competition was not the principal issue facing Royal Mail, and that other issues such as the company's efficiency and the structure of the parcel delivery sector were more relevant.

Ofcom is expected to address these areas through further work during 2015.

Vince Cable, the Business Secretary who ordered Royal Mail's controversial privatisation last year, accused Ms Greene of "scaremongering" and said there was no risk of the USO disappearing.

Since the Government sold a 60% stake in Royal Mail in October 2013, with a further 10% in the hands of the company's workforce, the shares have been on a rollercoaster ride.

An initial surge in their value saw them almost double during the three months after the £3.3bn flotation, but a combination of the UK regulatory framework, an investigation by French authorities and the growing impact of greater competition have weighed on Royal Mail during the second half of the year.

Ms Greene has demanded that Ofcom bring forward a review of the USO from the end of next year on several occasions since Royal Mail's privatisation.

The company's shares closed on Monday at 418.1p, down almost 25% during the last 12 months, although still just over 25% higher than the price at which they floated.

Taxpayers continue to own 30% of Royal Mail, but Mr Cable has said that shareholding will not be sold ahead of next year's General Election.

Ofcom and Royal Mail declined to comment on Monday.

[POSTMAN]

[donut]

So they won`t attack us from the (USO) side ......so it will be terms , conditions and pay that we`ll be hit on next year !!

[Budfrog]

It is not all gloom and doom as Ofcom are introducing new rules on the pricing of access mail:

"The new rules would allow Royal Mail to set fair prices for access services in different parts of the country based on the costs of delivery in those areas, allowing Royal Mail to make a fair profit on all ‘access’ letters regardless of where they are being delivered. The proposals would enable Royal Mail to vary its prices between different geographic areas, but would also ensure that these variations reflect differences in its underlying costs."

[rhino49]

It is not all gloom and doom as Ofcom are introducing new rules on the pricing of access mail:

"The new rules would allow Royal Mail to set fair prices for access services in different parts of the country based on the costs of delivery in those areas, allowing Royal Mail to make a fair profit on all ‘access’ letters regardless of where they are being delivered. The proposals would enable Royal Mail to vary its prices between different geographic areas, but would also ensure that these variations reflect differences in its underlying costs."

I like that ....
Dear Whistl, you can deliver to all the city centre areas that you can manage, but send anything via RM to an outlying or rural area and we will charge YOU what it costs, regardless of what cheap rate you have promised your customers at point of collection ! Then maybe you will understand the costs of running a proper mail delivery service.

[TrueBlueTerrier]

It is not all gloom and doom as Ofcom are introducing new rules on the pricing of access mail:

"The new rules would allow Royal Mail to set fair prices for access services in different parts of the country based on the costs of delivery in those areas, allowing Royal Mail to make a fair profit on all ‘access’ letters regardless of where they are being delivered. The proposals would enable Royal Mail to vary its prices between different geographic areas, but would also ensure that these variations reflect differences in its underlying costs."

Zonal Pricing for DSA.
http://images.lowes.com/product/converted/010254/010254209210lg.jpg<<<<Zonal Pricing for B2B AND B2C , surely followed by Zonal For Social Mail.

[wacko74]

Ofcom have really shown their true colours now, all their really interested in is enabling the race to the bottom for the T&C's of all workers across the sector.

Royal Mail and CWU need to join forces and come out fighting, enough of the meek and mild limp wristed attempts we've seen so far.

Didn't I read somewhere that technically, for the most part, the USO is just something that we voluntarily adhere to? And there's nothing to actually stop us from telling them where to shove it?

[SW17]

Its about time we stopped delivering mail for TNT outside the cherry picked areas while we still cover the bulk of the country because once they grow to a certain size we are knackered - sadly we are slowly contributing to our on demise delivering there crap, even though Royal Mail could never ask us to do this i'm sure it could be an effective way of hurting TNT, this way we also carry on working, yes Royal Mail would probably be hit with some big fines but over time companys would have to use us if they want there mail delivered, a new way of fighting back needs to be found if Ofcom wont help or we will end up seeing our terms and conditions deteriorate and come under attack year on year.
Use us for the whole country or don't use us at all.

[Chitchat]

Its about time we stopped delivering mail for TNT outside the cherry picked areas while we still cover the bulk of the country because once they grow to a certain size we are knackered - sadly we are slowly contributing to our on demise delivering there crap, even though Royal Mail could never ask us to do this i'm sure it could be an effective way of hurting TNT, this way we also carry on working, yes Royal Mail would probably be hit with some big fines but over time companys would have to use us if they want there mail delivered, a new way of fighting back needs to be found if Ofcom wont help or we will end up seeing our terms and conditions deteriorate and come under attack year on year.
Use us for the whole country or don't use us at all.

I completely agree with you, its time us postman/woman fight for our jobs! Its gotta be a TNT/Whistl boycott. They deliver one letter then they deliver all their letters. No more piggybacking of us! They are growing their DSA mail massively you only have to look in your daily mail bag.

[Spedley]

I don't see what parcels have to do with the equation? Surely the USO should apply to letters only because there has always been parcel companies. You need a license to handle posted mail but anyone can deliver parcels. If it is posted in the postbox then the USO applies, otherwise we should compete like for like with other parcel companies.

[El-Bandito]

I don't see what parcels have to do with the equation? Surely the USO should apply to letters only because there has always been parcel companies. You need a license to handle posted mail but anyone can deliver parcels. If it is posted in the postbox then the USO applies, otherwise we should compete like for like with other parcel companies.

Exfeckingxactly. Well said.
As for attacking our terms and conditions. This HAS to be agreed by shareholders, if I am not mistaken, WE are owners of a minimum 15% of Royal Mail.