Mail costs to soar on ‘yes’ vote

mail costs to soar on yes scots vote.jpg 2Brands running direct mail campaigns in Scotland could be forced to pay even higher prices if they opt to use Royal Mail services, should the country vote in favour of independence, according to one leading economist.
The Scottish National Party has already pledged that it will renationalise the Scottish part of Royal Mail if it wins this week’s referendum.
This, the party claims, would guarantee the Universal Service in Scotland and protect jobs and pay.
But a recent report from regulator Ofcom showed that Royal Mail already charges business customers 27% more if they are in rural areas than in urban areas such as major cities.
Any move to renationalise Royal Mail in Scotland would be likely to push prices even higher.
Although the postal operator does not break down the performance of the Scottish part of the business economist Stephen Gibson calculates it loses around £200m a year due to its commitment to deliver to all outlying areas under the Universal Service.
Gibson estimates that for a “Royal Mail Scotland” just to break even would require an across-the-board increase in prices of between 20% and 30% (or savings on an equivalent scale).
The Scottish National Party’s postal services spokesman Mike Weir MP told ITV that in the event of independence Scottish taxpayers would have to subsidise the service, although could not provide any figures to back up how much this would cost.

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