RURAL postal services could quickly become unaffordable unless Ofcom intervenes to prevent private firms ruining the “social and economic glue” of a universal service, Royal Mail has warned.
Countryside groups, Government advisers and the Royal Mail itself have all said there is an urgent need to look again at how allowing private firms to “cherry pick” the most profitable postal routes is putting at risk the business model that sees customers pay the same to post and receive a letter no matter where in the UK they live.
Evidence put before an MP’s inquiry into the postal service says there is a real threat to universally delivery, with Royal Mail calling on communications watchdog Ofcom to bring forward its own inquiry,
The inquiry call was backed by the Countryside Alliance and the Rural Services Network who both accused Ofcom of being reluctant to intervene to safeguard rural services, telling MPs that “the rapid expansion of competition in letter delivery in urban areas across the UK clearly threatens the ability of the Universal Service provider to collect and deliver letters and parcels in rural areas at affordable prices.”
Royal Mail last night told The Yorkshire Post: “We believe Ofcom should conduct an early review of the postal delivery market in order to fulfil its primary duty of protecting the universal service for all and to determine quickly the regulatory changes needed to safeguard it.
“Were the universal postal service to become unviable, it could represent the loss of a cherished service upon which thousands of rural communities rely.”
Ofcom has so far insisted their is no need to intervene, with officials insisting that as it has had sight of private sector business plan it is confident the universal service is not under threat.
Royal Mail’s own rural services admission comes after Richard Hooper, a mail adviser who has carried out three Government reports into the postal service, wrote to the Business Select Committee to say that allowing firms to cherry pick the best routes was clearly putting at risk he “social and economic glue” of a universal service.
Thirsk MP Anne McIntosh, chair of the rural affairs select committee, said it was clear the Government “must give a commitment to the future of rural post offices as we concluded in our Report on Rural Communities” saying that any changes to universal services would be damaging.
Rural Services Network chief executive Graham Biggs said: “If Ofcom continues to refuse to bring forward a review, the UK government should legislate to enable the Secretary of State to order a review.”
An Ofcom spokesman said: “Protecting the universal service is at the heart of Ofcom’s work, and our own evidence clearly shows that the service is not currently under threat.
“We are listening to the views of Royal Mail and other parties regarding competition in the market. We would assess any emerging threat to the service quickly, in the interests of postal users.”