With a decision due imminently on whether price limits for sending most mail and parcels can be withdrawn, the UK's postal services regulator representatives were yesterday closely questioned by Members of Parliament over their plans.

Members of the House of Commons' business, innovation and skills committee said they believed many vulnerable customers could be hard-hit by plans to remove the price cap for sending second class letters.

If that cap goes, Postandparcel.info reports that the Royal Mail will be free to raise the cost of a second class stamp by up to 53 per cent, from the current 36p to 55p.

Meanwhile, MPs also expressed anger that the Royal Mail could, essentially, soon also be free to scrap any distinction between first and second class services.

But Stuart Macintosh, Ofcom's group director of competition, came in for criticism from PostandParcel.info for being "clueless regarding what kind of prices an unrestricted Royal Mail might impose on first class mail and its other services, and how price increases would impact on mailers."

This was despite him telling the committee: “We believe that Royal Mail and the industry is in a much better position than the regulator to figure out how prices need to be set across the whole market in order to sustain its viability.”

And he claimed that the changes would free Royal Mail from “the dead hand of regulation ... so they will have some more flexibility.”



Article Added: 22/02/2012 12:02:00