|
LONDON: Britain's state-owned Royal Mail warned yesterday that industry plans to freeze its prices would starve the group of vital investment and result in inexorable decline.
Royal Mail was responding to plans by industry regulator Postcomm which would cap the price of stamps over the next five years and charge the company if it missed performance targets.
"These proposals will literally starve Royal Mail of vital investment and so wreck the quality of service we have fought so hard to improve," Royal Mail chairman Allan Leighton said. "We cannot accept them. It's as simple as that."
Royal Mail, which will have its core mail business opened to competition from next year, said in May it was meeting most of its targets after failing last year to meet any during its first quarter.
"Royal Mail's postmen and postwomen have achieved a fantastic turnaround and are now delivering the best quality of service in a decade," Leighton said.
"These proposals are a kick in the teeth for our people." Postcomm's proposed caps would allow the price of first class stamps to rise by four pence and a second class stamp by two pence up to the year 2010.
The regulator also unveiled measures which could cost Royal Mail up to Stg280 million ($NZ732 million) if it missed all its performance targets.
AdvertisementAdvertisementPostcomm chairman Nigel Stapleton said the caps were "challenging but achievable" and that they would provide a better deal for customers.
The Postcomm proposals were released for consultation for three months Yesterday and the regulator will provide a final set of plans after this.
|
