Postal Services Bill

Postal Services Bill : Fifth report of session 2008-09, Vol. 2: Oral and written Evidence

The Bill provides for the Post Office to be converted from a statutory corporation to a public limited company, with ownership remaining with the Crown. It introduces a new system of licensing and regulation for postal services operators and providers, and gives the independent regulator, the new Postal Services Commission, new powers and duties to protect and promote the interests of users. The Post Office Users' National Council is replaced by the Consumer Council for Postal Services, to bring postal services into line with consumer representation in the other utilities.

Postal Services Bill (HL) : (as amended in Committee)

The Committee's report considers two key issues: the maintenance of a universal service and the continuation of a sustainable Post Office network across Scotland. The report welcomes assurances that Scotland would not be made exempt from the universal service obligation. Further clarification is needed on Ofcom's power to designate more than one universal service provider. Ofcom should be required to consult with consumers, small businesses and vulnerable users in remote, rural and island communities in Scotland before it recommends any changes to the existing USO. There are considerable advantages to a long, stable and robust relationship between Royal Mail Group and Post Office Ltd and the Committee recommends that a ten year Inter Business Agreement should be reached prior to any sale of Royal Mail. On the Post Office network, the Bill makes no provision for the number of Post Offices and does not set out criteria for access to the network, a matter of concern because the current criteria could be met by 7,500 branches rather than the existing 11,500 branches. This could lead to many closures in Scotland. The Committee recommends that the Government gives assurances to preserving the existing network of branches. Elements of Outreach Post Offices, which replaced 102 Post Office branches in rural and remote parts of Scotland, are not sufficiently robust or reliable to provide an adequate service, according to the Committee, and it fears the new Post Office Local risks downgrading the service further. Improvements should be delivered as a matter of urgency.

In "Modernise or decline: policies to maintain the universal postal service in the United Kingdom" (Cm. 7529, ISBN 9780101752923) the Hooper review confirmed that Royal Mail Group was the only company capable of delivering the service and proposed a package to deal with the Group's problems. The state should take responsibility for the historic pension deficit; there should be a new regulatory regime, in which mail services would be regulated as part of wider communications services, and, most controversially, there should be a private sector equity partner in Royal Mail. The Government accepted these proposals (Cm. 7560, ISBN 9780101756020) and introduced the Postal Services Bill (HL Bill 24, ISBN 9780108454530). The Committee supports the proposals on the pension fund and the new regulatory regime. But it does not consider that the case has been made that these two reforms can only be made as part of a package which includes the third reform - the involvement of a private sector equity partner in Royal Mail. The provisions contained in the Bill allowing such a partnership are not necessary or desirable as the Government already has powers to sell shares to enable Royal Mail to participate in a joint-venture. There is a lack of clarity over how much investment is needed or where that investment will come from, while the Government appears to have no business plan and has not indicated the use to which any private sector capital would be put. Given this uncertainty the case must rest on its non-financial benefits, and the Committee poses several questions about the proposed partnership which must be addressed.

Postal Services Bill (HL) : (as amended on Report)

Considers legislation to increase temporarily postal rates and to create a Commission on Postal Rates.