Beneath threat: Royal Junk mail used its first annual fiscal consequences announcement to warn that prices may have to rise
Royal Junk mail could be forced to increase the price of stamps unless the unfettered rollout of rival postmen by TNT Post is brought beneath control, it was feared last night.
It warned that TNT Posts growth could threaten the fundamental economics of the universal service the rule that requires Royal Junk mail to deliver six being a week to every address in Britain.
Deliveries have to cost the invariable whether a letter goes to London or Lands End. Retaining this service was a key factor in Royal Mails sell-off last time.
When it was floated in October, ministers insisted the universal service was protected by principle.
Bar Royal Junk mail chose the announcement of its first annual fiscal consequences as a private theater company to warn that the obligation was beneath threat because the firm was losing business to its competitors.
TNT Post is not touch by the universal service and does not have to deliver everywhere in Britain.
Royal Junk mail said this method it know how to cherry ice pick worthwhile deliveries and locations only handling business post to large cities such as Manchester.
Within three years, TNT Posts expansion could cost Royal Junk mail further than 200million a time in stumped business, it said.
This would have to be recouped, leading to fears that the price of a stamp could rise raising the prospect of 1 for first-class deliveries.
A first-class stamp already costs 62p, up from 30p in 2005.
TNT Post, which was launched in 2012, know how to avoid the losing deliveries Royal Junk mail lawfully has to variety.
TNT know how to cherry ice pick worthwhile deliveries and locations rather than keep universal prices athwart Britain
It says its 3,000 orange-liveried postmen could be portion further than 40 per cent of British households by 2018.
Around 70 per cent of business letters, such as bank statements and gas bills, are now handled by one of Royal Mails rivals.
Royal Junk mail chief executive Moya Greene yesterday called on postal regulator Ofcom to scrutinize TNT Posts cherry-picking of what she called easy-to-serve urban areas.
She additional: We do not believe the current setting serves the most excellent interests of consumers. Ive however got to have that postman on that walk whether he has got two items to deliver or 2,002.
Lacking timely involvement from the regulator, upfront delivery competition resolve have a serious impact on the sustainability of the universal service.
Part of the sell-off deal was the obligation that the entire letters would cost the invariable athwart the kingdom
Bar Ofcom said: We do not believe here is presently a threat to the fiscal sustainability of the universal postal service.
It announced plans for a review in March last time, although it resolve not take place awaiting the end of 2015. Royal Junk mail insists it should take place without more ado.
TNT Post chief executive Nick Wells said: Its time to bring to a close complaining and induce on with promoting the postal sector in ill feeling of the trend towards digital communications.
The line up comes as Royal Junk mail revealed it was building profits formerly tax be on a par with to around 1million a day. It delivers 58million letters and parcels daily, with plans to trial the delivery of parcels on a Sunday this summer.
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