Saturday post could soon be a thing of the past after a new bombshell plan to shake up Royal Mail is set to be outlined by Ofcom next week.
The regulator will on Wednesday publish a consultation paper on the future of the service that is likely to include some major changes, Sky News reports.
It comes after MPs referred Royal Mail to Ofcom last year accusing it of failing to deliver letters six days a week.
Ofcom said last November Royal Mail had ‘breached its obligations by failing to meet its targets by a significant and unexplained margin’.
‘This caused considerable harm to customers, and Royal Mail took insufficient steps to try and prevent this failure,’ the watchdog added.
Other targets in the paper could include following countries like Germany where letters are delivered on alternate days.
The document will not contain conclusions or firm recommendations but ideas instead.
A 90-day call for input will follow, with formal proposals expected to be set out later this year.
The scrapping of a six-day system would also need parliamentary approval if formal proposals were accepted.
This was something rejected by government last year with Kevin Hollinrake, the business minister, saying last June: ‘We currently have no plans to change the minimum requirements of the universal postal service as set out in the Postal Services Act 2011… including six-day letter deliveries.’
It comes amid a period when Royal Mail has pleaded for changes to its regulatory framework.
It argues a system built for 20 billion letter deliveries a year is now managing only seven billion.
Royal Mail reported its best Christmas trading period for four years, with a 10% rise in revenues during the final quarter of the year.
Ofcom announced last September it would publish a paper focused on reform because it has not been changed since 2011.
In a letter to MPs this week, Martin Seidenberg, chief executive of Royal Mail’s parent company, International Distributions Services (IDS), wrote: ‘Delivering the current Universal Service requirements – in a financially sustainable way – is increasingly difficult, if not impossible, to achieve as the mix and number of parcels and letters changes.
‘The bar set by the regulations is unrealistic given the market realities.’
He wrote the way around this is to have ‘a government subsidy, and/or reforming the Universal Service so that it is more reflective of the customer needs and market realities of today, not the needs of the past’.
‘Whilst we welcome the forthcoming Ofcom review of the Universal Service, the inertia we have experienced means that we are now facing a far more serious situation than we would have been if action had been taken sooner.
‘Every day that Ofcom and the government further delay reform just creates more risk for the long-term sustainability of the Universal Service, and indeed Royal Mail itself.
‘We must maximise every pound spent to transform our business for the future and deliver more for our customers – not continue to sustain a service standard that was designed in a pre-internet era and no longer reflects customer needs.’
An Ofcom spokesperson told Metro: ‘Next week we will set out evidence and options on how the universal postal service might need to evolve to more closely meet consumer needs. We will be inviting views on this, not consulting on specific proposals.
‘It would ultimately be for the UK government and parliament to determine whether any changes are needed to the minimum requirements of the universal service.’
IDS did not comment any further when approached.
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