Postcomm today welcomed the agreement that will enable Royal Mail postmen to carry post on behalf of rival operator, UK Mail, for “the last mile.”
The agreement marks an important step forward for competition in postal services. Under the arrangements, UK Mail will hand over pre-sorted mail to Royal Mail at inward mail centres, from where they will be processed for eventual delivery by Royal Mail postmen. Royal Mail will charge UK Mail a fee for each letter, ranging from 13p for mail weighing less than 60 grams to £3.75 for items weighing 2Kg.
Postcomm is satisfied that, based on reasonable assumptions, the prices agreed between the parties ought to generate a similar amount of revenue for Royal Mail as would have been the case under the proposals Postcomm had been planning to publish in December.
Postcomm chairman Nigel Stapleton said:
“This is the first agreement of its kind and a landmark for competition in postal services in the UK. It enables UK Mail, a rival operator, to pay Royal Mail to use its nation-wide delivery network. It also sets a valuable benchmark for other customers and licensed operators who may wish to use Royal Mail’s extensive network in a similar manner.
“It is far better that the parties involved have negotiated their own access arrangements rather than have the terms and conditions imposed by Postcomm. Our determination document will not now be published, but instead we will shortly be producing a paper which will give guidance to other companies interested in access to Royal Mail’s delivery network.”
UK Mail originally asked Postcomm to determine the terms and conditions, including the price, of access to Royal Mail’s network. However, on 17 December 2003, just before Postcomm was due to publish its determination, the two companies announced that they had re-opened negotiations and had signed heads of terms. At their request, Postcomm agreed to postpone publication to give them time to work out the finer details of the contract.
