The proposals will allow first class letter prices to rise from 30p to 32p in April, and to a maximum of 36p by 2010. While this is more than Postcomm originally proposed, the increase is less than that asked for by Royal Mail. It wanted first class stamps to rise to 39p by 2010.
Postcomm's initial proposals published on 1 June, suggested the price would be capped at 34p. It has raised its proposed price caps to help Royal Mail reduce its £4bn pension fund deficit, modernise its operations, secure its universal service, and provide better customer service. The increase could, however, impact on mailing volumes.
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