Leighton lobbies MPs on Postcomm pricing

LONDON - Royal Mail chairman Allan Leighton has hit out at regulator Postcomm's plans to limit how much the postal operator can charge rivals to use its network.

In a letter to 659 MPs, he sets out his concerns that if the price it is allowed to charge its competitors is capped it could cost Royal Mail as much as 拢300m.

The letter read: "We fear Postcomm's incomplete thinking on the price we are allowed to charge competitors for access to our delivery network will remove another 拢300m. Our renewal plan cannot survive this."

Postcomm is currently negotiating on limiting Royal Mail's charges to deliver rivals post, however the caps are unlikely to be decided until next year.

These limits come on top of other pricing restrictions imposed as part of an agreement to allow the company to put the price of stamps up by 1p. These charges alone are expected to cost the company 拢460m.

"Postcomm's proposals on price controls will cost us 拢460m in lost revenue. And now another financial roadblock is looming", Leighton added.

Leighton also outlines how his three-year restructuring plan to return the company to profitability will be "fatally damaged" unless the regulator backs down. The letter urged MPs to write to Postcomm on behalf of Royal Mail.

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