Freedom for Parcelforce
Page 12
If you've noticed an error in this article please click here to report it so we can fix it.
by Guy Sheppard • Parcelforce and the Royal Mail look set to be given greater commercial freedom following the launch of a Government review into the future of the Post Office.
Although the terms of the review have yet to be set, Post Office management is demanding the freedom to make acquisitions and form joint ventures with other transport operators and to borrow money without having to meet public sector borrowing requirements.
But competitors are concerned that the Post Office's monopoly on deliveries costing less than ,E1 could be used unfairly.
Colin Beesley, marketing director of the UK subsidiary of US privatelyowned parcels carrier UPS, says: "The Post Office should not use profits made within the monopoly to cross-subsidise services in business areas where it competes in an open market, such as Parcelforce."
Department of Trade & Industry Minister Ian McCartney says the aim of the review is to remove "unnecessary and damaging shackles" while ensuring fair competition.
"The Post Office has been forced to stand by while foreign competitors, such as the Dutch Post Office, have had the freedom to forge ahead and position themselves to take advantage of the new opportunities," he adds.
Parcelforce is the UK's biggest parcels carrier, with a fleet of 8,000 vehicles and a workforce of 12,000. It made an operating profit of Ulm last year following five consecutive years of losses.
Royal Mail handles over 70 million items a day; it employs 161,000 staff and runs 28,500 vehicles.