Thursday 29 October 2009

Royal Mail strike update

The mail is getting through. So far.
CWU claim 50-60 million items undelivered, while Royal Mail say 5 million. Split the difference and its 30 million.
Royal Mail delivers about 85 million items a day so I expect the average delay will be 1 day extra. The 9/10 items that are posted by businesses can probably live with that. So can Royal Mail.
On strike days like today the mail actually being posted is far far less than normal as companies and people just don't post.

However this is causing damage to business. Card companies are especially hard hit as people just aren't sending what is usually an impulse item anyway. The damage is falling especially hard on small business who cannot switch to alternatives, and the 12,000 Post Offices who are paid by the stamp and are seeing a huge reduction in mail traffic. So far its manageable but if CWU continue to strike and RM is forbidden to bring in its 30,000 temps before the Christmas orders start it will be catastrophic for the economy.

The Tories feel strengthened by this dispute and have announced their plans to fully, not partly, privatise the mail. Quite how is unclear. If its anything like the trains privatisation a parcel will cost around £100 to send unless you book in advance through the national postal service. If you do it will only cost you £50 and taxpayer subsidy of £50.
But privatisation of the mail has long been a requirement of the Tories and is now virtually an EU requirement anyway. Ken Clarke would love to get rid of a government problem, a modernisation problem and a union problem and make it all a regulators problem.

CWU really must get an agreement soon. At the moment they have the support of the public sector, the fury of the business sector and a 50/50 from the public. Christmas orders traditionally begin increasing from Monday after the Halloween stock is packed away for another year and the Santa sets come out.

CWU really are bringing anything they can think of to the table. From the size of a postman's round to the time allowed for a coffee, to the weight of a bag of mail. Its exasperating for Royal Mail. But ,as we have said before, Royal Mail management aren't blameless.
Just today, in the middle of a strike, they sent out the latest round of hours reductions. Each delivery postie, deciding if they should go on strike on Saturday, will have been told today that their hours, and pay, will soon be cut and their workload increased. How did the incompetent management think the workers would respond?

Ken Clarke must be rubbing his hands in anticipation of a long,destructive and futile strike that leaves a broken union, demoralised workforce, and a bankrupt organisation ready for TNT.


Old BE said...

You say that things will cost more if the Mail is privatised, but the current service is getting to the point where it is so bad that everything has to go special delivery anyway. Just yesterday at work we received a letter in a plastic bag with a "Sorry!" label on it - the letter looked like it had been chewed by a dog. With service like that I'd almost prefer the Mail didn't exist at all.

Important documents by courier, everything else by email.

I have absolutely no faith in the Mail as currently constituted, therefore for me it is now a question of how to get rid of it in the least costly way.

Houdini said...

We have been through this before, with long analysis, so will be brief. I dislike unions, so I have no axe to grind on their behalf.

This Government has systematically destroyed RM because it could not, ideologically, privatise it. It took the profit it made, from 1997, and gave it to the treasury, money that had always been ploughed back into the business. It deliberately starved the business of real investment. RM made half a billion annual profit but now has got rid of almost 75000 workers, halved the deliveries they mke, scrapped Sunday pick ups, scrapped the mail trains...and that isn't all, but is now losing money, or was?

RM gets paid a maximum of 20p to deliver TNT and others mail, but it costs them 26p to do it, so what do we expect but destruction of the business?

It was, and is, a deliberate ploy to destroy the business for ideological reasons and make privatisation the only option, and it has been going on for years.

Budgie said...

The concept of a universal postal delivery service to every house and business lends itself to a monopoly. This is probably accomplished more safely by democratic control - government run, as now, or some form of trust with elected representatives.

It is crazy to privatise the Royal Mail whilst continuing with a government owned BBC. There is no longer any reason for the BBC to exist as a quango, if there ever was. It should be broken up and sold off. Modern technology means the parts of the BBC can support themselves by pay to view (with or without adverts).

Bill Quango MP said...

Houdini: Quite right. I have no proof, but equally no doubt, that the Forward to Eleven strategy was to be ready for sell off.
A major problem as we have discussed before was the early deregulation bought in almost exclusively in the UK. Tony Blair wanting to show his good European credentials allowed the private companies in before RM was ready to deal with them. No one has really benefited from that decision except the largest of bulk mailing companies like Amazon. In other countries, having seen the mess we have made, began pumping money into their mails services and preparing them to be leading players in a deregulated marketplace, ready to take on other Euro mail carriers. They still have 18 months to prepare and probably longer once the deadlines are moved again.

BE is badly hit by being in London where the mail has been awful for nearly a year. It isn't like that in the rest of the country, outside of the reach of the socialist workers of London's paradise.

BE: A major and simple solution is to charge a lot more for the mail, to charge competitors a rate that makes a modest profit , and to reduce the mail to a 5 day a week service, with extended collection time on fridays to 7pm let the businesses and families post in time.
Privatisation is coming. But like with the utilities and railways and telecoms we will be staggered when the real, and ever increasing costs come in.

Old BE said...

I think people will be prepared to pay for a service that actually works. Saying the prices will rise is a false threat: at current prices the service is so poor as to not be good value. When letters either don't arrive at all or arrive looking like they have been through a combine harvester then dropped in a muddy puddle are we supposed to say "ooh, well it will be worse if it's privatised"?

The plan to run down the service sounds plausible although possibly a bit too clever for the people who have been in charge for the last twelve years. I suspect cock-up rather than conspiracy give their record in other areas.

That said, what happened since 1997 is now of not much relevance. Can the service be resurrected without huge public investment? Will people stomach huge public investment in the current environment?

Bill Quango MP said...

Can the service be resurrected without huge public investment? Will people stomach huge public investment in the current environment?

No and no.

That's why your mail will cost twice as much to be delivered in exactly the same way and condition as you receive it now as it will go through the same equipment and network but under cheaper labour.

The vans will have a different colour though, as will the uniforms.
And a brand new logo too!

When it rains the mail gets wet. its made of paper. The machines damage letters as they go through them but it really is less than 0.001% of all mail.

Cheer up BE. Otherwise you'll be doing the phone ins complaining about red elastic bands!

Old BE said...

So I am supposed to "lump it" in true socialist monopoly triumph. Sorry your tiny percentage does not ring true. I get letters all the time addressed to different addresses. I find that things which have been posted to me often do not arrive. Perhaps you think that's acceptable, I don't.

Would you be happy if your phone often just cut out or connected you to the wrong person? What would you say if every now and again your taps just ran dry? Would you be saying "oh well it's only a tiny percentage"?

I would prefer to go back to how it was a few years ago. I personally think that having competing providers for the universal would be a nonsense, but in return for a public monopoly, the Mail must provide an acceptable service. It currently is not.

Marchamont Needham said...

I know the CWU is a dinosaur, but the lack of creativity about the industrial action is really disappointing.

Here's my timetable.

Monday - every postie to send three letters to Gordon Brown's home address. Let's see him find his gas bill among that lot.

Tuesday - letters to random addresses in the Outer hebrides. At 20p a time that should hurt. And presumably failure to deliver on time will hit managers' bonuses.

Wednesday - letters to Alan Johnson, because one cannot abide turncoats.

Thursday - the Queen; it is the Royal Mail after all and Gordon should get a right royal ear bashing at his next audience.

Friday - the Scilly Isles and the Channel Islands.

Saturday - indefinite strike on full strike pay by all posties who deliver to Whitehall and Westminster.

Far more fun, the posties don't lose any pay and the union pays out virtually nothing in strike pay.

Everybody wins and we get really funny items on the 6 O'Clock News. Who could want for more.

Bill Quango MP said...

BE. Capitalists at work hardly advocates a state monopoly.
The point that is trying to be made is that RM until very recently hit all of its delivery and service targets. it was one of the best mail providers in the world.
Today, that is not the case.
If the letters in your box are for another address that is a labour problem. Employing cheaper, casual, part time workers won't solve that.

All I'm saying is that it will be privatised, should be privatised, but will initially cost you more for a service that is very little better. Eventually it will cost you a lot more.

Old BE said...

I think you are saying what's wrong without proposing any solution which might return RM to a position where it can provide a good and good value service.

And instead of entering into the debate you are saying that I shouldn't complain that my letters often don't turn up or turn up having been ripped and/or soaked.

Let's have some proposals!

Anonymous said...

Even if postal services are privatised, there is no guarantee that the service will be better.
For example, look what happens with privatization of the energy providers. You have (almost) the same high prices and the same/similar bad customer service/experience from all of them. There is no competition. Sometimes, it is better to have just one provider with guaranteed quality service, than having many with bad or unsatisfactory service (because it is not economically viable).

Thud said...

I'm we BE on many I know it isn't just a matter of isolated incidents the service in my area is an unmitigated disater on all fronts.

James Higham said...

It's certainly affecting me at the moment, jobwise.

Mr Ecks said...

Privatisation simply replaces state socialism with corporate socialism. The thugs of the state still confiscate your money under threat of violence but instead of handing the money over to their own useless employees they hand it over to private crooks instead. These private "companys" have the corruption of the state as their customer not the people whose money has been stolen. The skills these companys mostly display are those of sucking up to (and bribing)political scum to get contracts, they could not care less about the public.Many of them take contracts by giving out very low bids which then mean that the more they do the less profit they keep. Hence it becomes very difficult to get them to do anything at all.For the moment the Mail must stay public until the point where the mails be thrown open to anyone to carry post with true free competition. Soon

Houdini said...

I think the problem here is that a monopoly may be the best thing for the service, and for a couple of others too, much as it pains me to say it.

Look at directory enquiries; it was a simple dial 192 and ask for a number...easy. Now it is dial this or that and be charged a bloody fortune.

Some things are better left alone, despite being unfair or undemocratic or the House of Lords, which worked before Labour fucked it up, or RM, which worked before Labour fucked it up, or Directory Enquiries and so on and so forth.

I am a committed capitalist in every sense, but that makes me feel the ideological or modernising argument for change is stupid when something, simply, works.

Bill Quango MP said...

Ok lets close this up. Looks like we will have plenty of opportunity to return to it again as its not going away.

Budgie: When government is involved logic is unwelcome. Ask the drug scientists.

Marchamont Needham:
I like all of those. There actually many things that the union could do instead of a strike but this union has a history of industrial action.

BE: response on your excellent blog. I'm not mad at you! I thought we were having a discussion.. jeezz, Its like being with Billy Hayes.

Anon, Mr Ecks, Houdini:
Quite true but too late. The EU has declared mails deregulation and it cannot be stopped in this country, without leaving the EU.
Like the ridiculous HIPS that's dreadful for a property slump it must be obeyed.

James Higham:
How do you mean, do tell.

Electro-Kevin said...

Of course the multi-millionaire Crozier can only dictate to £250 pw postmen that they must increase their workload and take a pay cut because of lax immigration policy... which the vast majority of British people did NOT want.

hovis said...

Mr Ecks has several valid points about privatisation - in itself is no panacea. I am very much a free market capitalist so theedfore belive in the market NOT the state/private corporatism that lends its elf towards the neo-corporatism we see very much of these days. Don't get fooled by the labels look at the real meat of the set up.

Anonymous said...

The skills these companys mostly display are those of sucking up to (and bribing)political scum to get contracts, they could not care less about the public. Skin Lightening Cream

Anonymous said...

These private "companys" have the corruption of the state as their customer not the people whose money has been stolen. Springfield Armory

Anonymous said...

You have (almost) the same high prices and the same/similar bad customer service/experience from all of them. There is no competition. Office Supplies

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