Thursday, 8 May 2008
Snail Mail shake up
Well, we have already said here that it wouldn't work.
The Independant Review Panel has pretty much decided that there is little or no benefit of mail privatisation to UK households or small businesses. In fact all it has really done is damage the universal service that everyone benefited from. Without the subsidy from the business customers the universal service cannot survive.
Royal Mail has lost or is losing its most profitable customers while being forced to keep its most unprofitable and loss making ones. Regulators already ruled out posting zones, the abolition of 2nd class and reduced collection and delivery times some while ago, but you can be sure they will all resurface soon.
Recently La Poste, France's national postal carrier has bought a controlling stake worth around £20 mil in BTB Mailflight, a British company that handles international business mail. La Poste already operates La Poste UK and this deal is an expansion to allow collection and sorting operations.
And here is the problem. La Poste has has a monopoly in France. It faces no competition in it's domestic market and is also allowed to operate in the liberalised UK mail market. It can pick the best bits from the business market here and ignore the less profitable. Meanwhile Royal Mail must take the less profitable and cannot pick up any business from France at all.
There are currently 19 licensed mail carriers in the UK, and that will only increase as there are almost no restrictions to entry and a license cost just £50.
Why did we allow this situation to develop..? erm, wasn't it to allow greater CHOICE for the consumer, cheaper postage rates and an improved service.
It wasn't a sneaky way of dumping Royal Mail,Parcel Force and Post Office Limited onto the private sector was it? Well now that the RM requires a "fundamental reform" then come on Mr Darling, you can tell us, we can keep a secret..
Posted by Bill Quango MP