Postcomm to be axed

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http://www.precisionmarketing.co.uk/Art ... +axed.html

Postcomm could soon cease to exist if it cedes responsibility of regulating the postal market to Ofcom as proposed in a report.

The study by Richard Hooper, the former deputy chairman of media watchdog Ofcom, proposes that Ofcom should maintain the Universal Service in the wider context of the other changes taking place in communication markets.

The proposal to give the responsibility to Ofcom is due to lack of trust and disagreements about basic information between Royal Mail and Postcomm, diverting energy from the postal operators chief challenge, which is to modernise the business.
However, the decision is yet to be approved by Parliament. A decision will be made in January.

The Communications Workers Union (CWU) supports the move to Ofcom. Billy Hayes, general secretary, CWU says: “We welcome the move to Ofcom which recognises both changes in the communications sector and the failings of Postcomm to manage the mail market effectively, however we look forward to receiving more information on future regulation.”

A Postcomm spokesperson says: "We are talking to the Department of Business, Enterprise and Regulatory Reform and Ofcom to ensure a smooth transition process pending approval by Parliament. Postal services will continue to be regulated by Postcomm.”

Describing the current Royal Mail situation as ‘untenable’, the report also suggests Royal Mail should be part-privatised in a bid to modernise the service. Lord Mandelson has backed the proposal, saying ‘It will bring the Royal Mail fresh investment, new opportunities to grow in Europe and internationally’.

Dutch postal company, TNT, has already expressed an interest in the minority stake. However, the Government is also encouraging other expressions of interest from credible partners.

The Hooper review, commissioned by the BERR follows a £500m loss of profits at Royal Mail in the past year due to the impact of changes in technology and consumer choices.