New postal charges come into force

21-08-2006

Changes to the cost of posting letters and parcels in Britain come into force today, in a move dubbed as the biggest reform of the country's postal system since the introduction of the penny black stamp.

In the most significant shake-up of charging procedures in 165 years, mail will be priced according to its shape and thickness, as well as its weight.

Royal Mail insists that the changes will mean that postage for more than 80 per cent of items, including business post, will remain the same or be cheaper.

The government-owned postal group says the change has been introduced so that prices reflect more fairly the actual cost of collecting, sorting and delivering mail, particularly larger letters, which have to be sorted manually, rather than by machine.

The changes come as Royal Mail prepares to face increased competition from rivals, with the UK postal market set to be opened to full competition from next year under European rules.

Explaining the changes, Royal Mail director of pricing Lorna Clarkson said: "Royal Mail has to rebalance its prices as competitors are already forecast to take one in seven mail items this year."

"We want to make it as simple as possible for our customers to understand. That's why we've introduced the three size categories."

She added that there were ways for people to ensure that they did not pay more than necessary under the new system, for example by folding A4 letters in half to fit into a C5-size envelope, thus ensuring that such an item of post was costed as an ordinary letter rather than a large letter.

But despite Royal Mail's claim that it has attempted to make the new pricing system easy for people to understand, consumer watchdog Postwatch has criticised the way that the changes have been introduced and warned that the public could be left confused as a result.

A survey of more than 300 post offices conducted by Postwatch at the beginning of August found that a third did not have any information for customers about the new charging scheme, known as Pricing in Proportion (PiP).

"Basic sources of information such as posters and leaflets should have been available at all post offices well in advance," said Judith Donovan, chairwoman of Postwatch's trade association forum.

"A third of post offices failing to do the bare minimum points to a potentially complacent approach in introducing what will be the biggest change to our postal service since the penny black," she added.

Royal Mail claims that the results of the survey are not surprising as the research was conducted before the distribution of leaflets, posters and other information to post offices was complete.

Commenting on today's price adjustments, the chief executive of rival firm Business Post, refused to criticise Royal Mail and insisted that the market would benefit from more competitive conditions.

Speaking on the Today programme, Guy Buswell, said: "From Royal Mail's perspective they are absolutely right because in terms of their costs a larger item does cost more than just the weight of an item.

"We have just installed two large format sorters, one in London and one in the north, and they're devised to sort mail on behalf of our customers and give it back to Royal Mail. We hope with our business class product we'll be able to save customers between ten and 15 per cent on the new pricing in proportion charges charged by Royal Mail," he added.

Amid speculation that workers will be unable to immediately adapt with the wholesale changes, the assistant secretary of the Communication Workers Union (CWU) has said that its members are fully prepared.

"I think the Royal Mail to be fair are actually very well prepared for this. My members that work in Crown Post Offices have been retrained, and they've got expertise and experience, and they will be able to deal with the public," Andy Furey told BBC Radio Five Live.

But the general manager of the Greeting Card Association, Sharon Little, has said that the detriments of the system outweigh the benefits due to the confusion surrounding the changes.

"I agree that in the end anything that makes the Royal Mail more efficient in the long run is going to be a good thing. What we're a bit annoyed about is the fact that not many people actually seem to know about it at the moment," Ms Little said on the Today programme.


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