Lib Dem MP Robert Smith voices Lib Dem support for preservation of Universal Service Obligation at debate at Westminster Hall.
Speaking on a Lib Dem motion of the Universal Service Obligation in Westminster Hall, MP Alistair Carmichael pointed out the importance of a debate on Universal Service Obligation “following the recent application by the Royal Mail for zonal pricing for bulk mail, on which consultation with Postcomm has just concluded.”
Mr Carmichael expressed his concern that if Royal Mail’s application for zonal charging for bulk mail is approved, bulk mail will be removed from the universal service.
He suggested: “What is left will hardly be worth the name. It will hardly be universal and it will barely be a service.”
Speaking up for his constituents, Mr Carmichael said:
“Communities in Orkney and Shetland depend on Royal Mail's universal service. Local businesses face many challenges-we have additional travel costs and exceptionally high fuel prices as a result of our geographical location. However, mail prices have remained largely uniform throughout the country and companies in the northern isles have been able to send mail at the same price as firms in other parts of the country.”
Lib Dem MP Danny Alexander also expressed his concern that the government, and Postcomm, are pressing ahead with the opening up of the mail market without first ensuring that there are adequate safeguards in place to protect the universal service. He went on to highlight that there was “the danger that businesses will pass on the increase in costs to the consumer. If electricity, gas and telecoms companies that send out bulk mail know that they will have to pay more to Royal Mail to send a bill to a customer in a rural area, they will pass on the cost to the customer and the people in rural areas will receive larger bills.”
Lib Dem MP Alan Reid further explained “the proposals would clearly have an unfair impact on recipients of mail who live in remote rural areas. Although they would perhaps not be buying the stamps, it is quite obvious that utility companies, banks and magazine distributors are likely to increase their charges to those customers, as they will want to recover the charges.”
Lib Dem Sir Robert Smith, speaking for the Liberal Democrats, made clear that “the present situation has come about because of the opening up of the letter market, which was the result of European Union regulations and the decision to open up the whole of the European market-albeit not at the pace that it is happening in the UK.”
Pointing out the “importance of the service that Royal Mail provides to all constituents”, Mr Smith warned that the service needed to be “preserved, protected and enhanced, not chipped away at and reduced.”
Mr Smith further highlighted the importance of the debate by saying:
“Not only has there been a loss of service across rural areas, but the pricing issue, which used to affect only the highlands and islands, has spread far wider. The north-east of Scotland, which was protected by being near the big city of Aberdeen, is now also affected by differential prices set by the delivery companies. As I emphasised in my intervention, ultimately it is the consumer who suffers, because the company that sends out the product puts a surcharge on it to cover the extra delivery costs. We have a very real challenge. What happened with zonal pricing in the parcel market is a warning sign that the regulator needs to take fully on board.”
He went on to say:
“Royal Mail’s application for zonal pricing is a timely warning that we must review the Act to avoid irreversible damage. I hope to hear from the Minister how the review is to be implemented to produce a timely response. Royal Mail has responded dramatically to the challenges of competition, and it has done much to improve its services and operations. It must be allowed to bed in those improvements and to adapt to the pressures of competition in a way that does not destroy its operation.”
