Leighton blasts Postcomm price recommendations

LONDON - Royal Mail chairman Allan Leighton has threatened to fight Postcomm in the courts over the pricing of access to its local delivery network by rival companies.

Postcomm today revealed that it recommended that UK Mail, a courier company, could be charged as little as 11.5p or as much as 拢4.06 for Royal Mail's last-mile service.

The charge is for Royal Mail to sort and deliver UK Mail items to their final destination by postmen and women, along with the Royal Mail's own deliveries.

Leighton said the charges were worse than he had feared. "We were alarmed at the way Postcomm was moving last autumn to an access price of 14p for Royal Mail against a full price for First and Second Class stamp basic postage of 28p and 20p."

"Postcomm's plans today propose an access price of just 11.5p, so the regulator has moved the access price even lower than we feared," he said.

Leighton said Royal Mail was prepared to give other firms access to its network, but at a "fair and realistic" commercial price.

"If Postcomm's plans amount to a green light for rival firms to cream-skim profitable mail and leave Royal Mail without the means to provide the universal service, then we will not hesitate to fight the regulator's plans in the High Court and, if necessary, the European Court," he said.

However, Postcomm defended the move in a statement, saying it would allow Royal Mail to recover a 6% operating profit from this business by 2006.

Postcomm chairman Graham Corbett called the move a "crucially important step in the opening up of the postal network" and that it supports the universal service.

"We are aware that Royal Mail is sensitive to loss of volumes but if the price is pitched too high that would not only deter the development of effective competition, but in due course drive competitors to set up alternative delivery networks, leading to a much riskier market for Royal Mail and everyone else," Corbett said.

If you have an opinion on this or any other issue raised on Brand Republic, join the debate in the .

Topics

You have

[DAYS_LEFT] Days left

of your free trial

Subscribe now

Get a team licence 

 Give your teams unrestricted access to in-depth editorial analysis, breaking news and premium reports with a bespoke subscription to 北京赛车pk10.

Find out more

Market Reports

Get unprecedented new-business intelligence with access to 北京赛车pk10’s new Market Reports.

Find out more

Looking for a new job?

Get the latest creative jobs in advertising, media, marketing and digital delivered directly to your inbox each day.

Create an Alert Now