Ofcom probes Royal Mail charges

Royal Mail has been forced to shelve proposed price changes – which include big volume discounts for some – after a TNT Post complaint to Ofcom triggered an investigation.
At the heart of the issue is the fact that mailers using rival operators for everything but final mile deliveries would not be eligible for the bulk discounts – in fact those using so-called “downstream access” would end up paying more.
Royal Mail has insisted the changes are in response to market trends and reflect the cost benefit it would gain from being able to plan more accurately at a local level and deliver greater efficiencies. The new pricing structure, which will see most companies pay more, was revealed in January. It was due to start at the end of March.
“We considered carefully our legal and regulatory obligations before notifying Access customers of the changes. We believe that the changes are fair, reasonable and proportionate,” Royal Mail said. “We wish to see this matter resolved as quickly as possible so that these planned changes can be put into effect to help secure the sustainability of the Universal Service.”
The proposed Royal Mail changes under investigation include a new price plan that would offer a 0.25p per item benefit for mailing customers who promise to use Royal Mail for mail delivery across 86 local districts, and who provide monthly forecasts on expected volumes up to two years ahead.
Changes to Royal Mail’s zonal pricing in four zones – London, Urban, Suburban and Rural – are also under investigation.
The move follows the expansion of TNT’s final mile delivery service. Last month it said it will double the size of its London workforce to 2,000 posties.
The company currently operates a mail delivery service to businesses and consumers in Central, West and South West London from 12 delivery units.
This next phase of expansion will see the opening of four new delivery units in North West London and Harrow, with the recrutiment drive kicking off with the hiring of 400 posties in Camden, Willesden, Colindale and Harrow.

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