Bad news for Royal Mail? EU bans postal monopolies from 2011

[TrueBlueTerrier]

http://www.dailymail.co.uk/pages/live/a ... ge_id=1811

National monopolies for mail delivery in the European Union will be dismantled by 2011, with postal companies free to operate in any of the EU's 27 countries - meaning the Royal Mail could face threats by European competitors on British soil.

Nine new EU countries plus Greece and Luxembourg will get the option of an additional two years to prepare for a full opening of the delivery of letters under 50 grams (1.75 ounces) - the last category where national postal companies face no rivals.

The plan was approved by the European Parliament today.

A universal public service ensuring every European gets at least one delivery and collection a day, five days a week will still be guaranteed and can be subsidized by governments if it loses money.

Postal services in the European Union handle an estimated 135 billion items a year, with an estimated turnover of 88 billion Euros (£65billion) - around 1 per cent of the union's gross domestic product. The sector employs more than 5 million people.

Full liberalization should lead to cheaper and more reliable mail deliveries, according to EU officials.

It could also force the Royal Mail to scramble to remain competitive against European services moving to Britain - and raises the possibility of a Royal Mail service operating on the continent.

"We will have more competition, which should increase quality and decrease prices for the customers very soon," said German Christian Democratic lawmaker Markus Ferber, who steered the legislation through the assembly.

An organization representing customers and competitors of the public postal operators across the EU called on the national regulators to prevent national monopolies from unfair tactics.

"Backstage maneuvers to introduce barriers and protectionist rules that risk hampering access to new entrants in the market have to be avoided. Competition must be considered as an opportunity rather than a challenge by postal operators," said Philippe Bodson, the president of the Brussels-based Free and Fair Post Initiative.

The issue of outside competition for domestic mail-carriers is a heated one in many EU countries. While parcel and package deliveries have already been liberalized across the 27-nation union, national governments may still reserve the market for delivering letters under 50 grams (1.75 ounces) for national carriers.

As a result, a simple registered letter sent from Belgium - where the national La Poste/De Post mail operator faces no competition - to neighboring France costs a whopping 6.70 Euros (£4.95).

Many countries have been slow to open their postal market to competition. Only Sweden, Britain, Finland have scrapped all legal monopolies. Germany has also liberalized its postal deliveries, but the government has introduced fairly high minimum wages - between 8 and 9.80 Euros - for letter carriers, which critics say could deter potential competition to former monopoly Deutsche Post.

"One can ask if the minimum wage fits with the income in other similar jobs," Ferber said.

Ninety per cent of European mail is sent by businesses, and this is where most new entrants are likely to target new, lower-priced services - ignoring unprofitable consumer services in remote or rural areas.

The postal reform was first considered more than 15 years ago as part of the gradual opening of Europe's services market. In its last set of proposals, the executive European Commission wanted all monopolies to be dismantled by 2009, but was overruled by the European Parliament and apprehensive member states.

[sevenandseven]

but the government has introduced fairly high minimum wages - between 8 and 9.80 Euros - for letter carriers, which critics say could deter potential competition.

Converted this is £5.96 - £7.30.
This is a 'fairly high' minimum wage?
Like to see these Euro commissioners/ friends of big business live on this minimum wage. Wouldn't even cover their expenses which they seem to forget comes out of the taxes taken from every working person. Let's privatise the EU monopoly and put all their jobs out to tender so we can get value for money.

[plodsie]

I don't think these monopolies will ever have the same level of competition because they probably will not have the same regulator as we do to bring in crazy suicidal plans like DSA. It will certainly be interesting to see how Deutsch Post and TNT will cope if their governments ever bring in such a regulator, perhaps ship out to this country to take advantage of our "brilliant" employment laws and impotent regulator.

[gazzer]

It could also force the Royal Mail to scramble to remain competitive against European services moving to Britain - and raises the possibility of a Royal Mail service operating on the continent.


Any chance of me working on one of the Greek islands or even Spain

[DGP1]

It could also force the Royal Mail to scramble to remain competitive against European services moving to Britain - and raises the possibility of a Royal Mail service operating on the continent.


Any chance of me working on one of the Greek islands or even Spain

That's the flexibility I'm talking about

[solcat]

It could also force the Royal Mail to scramble to remain competitive against European services moving to Britain - and raises the possibility of a Royal Mail service operating on the continent.


Any chance of me working on one of the Greek islands or even Spain

Get in the queue Gazzer

[tomangoe]

Interesting that the EU says a Universal service 5 days a week.That means we could do Monday to Friday,35 hour week and Royal Mail would save a fortune ! I can dream can't I ?

[Glenno]

should have shot Ted Heath

[TrueBlueTerrier]

Interesting that the EU says a Universal service 5 days a week.That means we could do Monday to Friday,35 hour week and Royal Mail would save a fortune ! I can dream can't I ?

Well you can but throwing in a spanner would not this mean a loss of at least 1/6 of the staff on deliveries. The CWU and RM would have to handle that with more than their usual care.